| Your 401k plan is very poor, and now is the time to fix it. |
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401kDave
Member
Cash: $ 3.10
Posts: 15
Joined: 09 Apr 2008
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| Your 401k plan is very poor, and now is the time to fix it. |
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Two major factors have collided that make it a perfect time to insist that your company drop their big named underperforming 401k plan with the fancy pamphlets and website and find one with great performing funds.
Don't be a sucker and think that because these companies have fancy commercials they are providing you with a good retirement plan. It's common since if you think about it, the biggest companies are paying huge amounts in advertising dollars and they are taking them out of your retirement. In my profession I find that the biggest most prestigious names often provide the most underperforming funds, WHICH MEANS less money for you.
I know you like the fancy web pages, BUT this plan is about maximizing your returns so you can grow your account as large as possible with the money you are putting in. Look for a fancy fun to use website for your stock trading if you're still trying to make money that way. Focus on good funds, performance and time to grow with a good longterm approach in your 401k.
I don't blame people for not wanting to invest in their 401ks most of them are very poor. Your boss probably picked the broker and provider because they take him to play golf.
I've found few Trustees have any clue what a good plan is, but I don't blame them because the providers make it very difficult to understand and they really talk about their plan like it's the greatest plan on the market. Not even CFOs get it.
THE good news is you can do something about it and its easy. Plus if they don't listen you can now SUE them. According to the ERISA laws your company trustee should be aware of conflicts of interest, his nephew works for the provider, the broker is on the board, the broker handles his personal assets. If you can tie any of these to your plan and you want better return for you, YOU'VE GOT A CASE.
Here's how you do it.
1. Collect your fund choices and the year end performance.
2. Ask your HR manager for all fees that are paid on the plan and who pays them. (they have to tell you)
3. Find out the total plan assets.
4. Find out the annual contributions.
5. Find out the number of active participants.
6. Have an initial independent review done by an independent adviser. [edit - solicitation removed]
7. Spread the results to your fellow employees quietly.
8. If they get on board send an anonymous email insisting on having that independent adviser evaluate the plan
They say an extra 1% can add up to several thousand at retirement. You might be sick to see how many % points you could improve your plan returns with this process.
You only have one chance to save for retirement, get off the back of that three legged turtle.
Your 401k insider.
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Wed Apr 09, 2008 12:52 pm |
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