I started a 401K plan through my employer, how should I manage it?

I have elected to contribute $5 per pay period starting out. But increase it little by little as time goes on. What should I know about 401Ks? Should I talk to a financial advisor?


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Most Helpful Guy

  • Do you have an employer match (usually it's like 50% up to $xxxx) If so, definitely have that be your minimum so you don't leave money on the table.
    401(k) retirement plans are really simple actually. It'll be managed by a broker that works with your employer, like Fidelity for example. You can reach out to Fidelity with your plan directly, rather than your employer, and ask them questions. Usually you can choose between conservative or more aggressive plans, but there isn't much customizations typically.

    Read online, like investopedia. com concerning 401(k) plans and how they operate, it'll be good contextual knowledge for you. They are just pools of stocks, it's pretty simple and straightforward. They are highly diversified so they are generally very, very safe and secure investments.

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    • Yes they do match. And our is through Wells Fargo which is also who I bank with

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    • Well I'm happy to help if I can. I know more than just weights believe it or not. Actually, I may know more about finance than weights. But investopedia. com is a great resource for starters.
      Really the 2 rock solid investments beginners (and everyone really) should get into (like yesterday) are:
      1. 401(k) or IRA retirement accounts
      2. Open a simple investment account and get going. OptionsXpress. com I use and love, no minimum balance needed to open an account from what I recall, and just get some Vanguard S&P 500 ETFs, rock solid as it gets.

    • Number one has already happened. The company automatically enrolled me. What investments are hot right now?

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What Guys Said 5

  • Once again I agree with ConsultantIsBack.
    That is THE best thing for someone in your age group to do.
    The companys match will be in their stock. That's fine. They should give you a choice of where to put your contribution. I's go with an S&P 500 fund or a total stock market fund depending on what's offered.
    Right now you do not need a financial adviser. Nobody will help you better then yourself. Read about the markets. When the time comes look at Vanguard or Fidelity funds.
    One word of advise I like to tell people is that every 3,4 or 5 years move whatever funds you can out of your 401K (without being suspended from the plan) into a Roth IRA. This way if the company has difficulties the money you moved will be yours.
    Take the AT&T you know today is really in name only. The AT&T your parents knew was unfortunately a penny stock due to poor decisions. AT&T name was purchased by SBC for global recognition. Point being any company can fall on hard times.

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  • @consultantisback is the the only one on this site I know of qualified to give advice

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  • What match do they do

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  • you came to the wroooong site.

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  • Ask H. R.

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    • What would they know? Could I talk to the firm who handles the 401Ks as well

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    • @ConsultantIsBack But H. R. will know who the brokerage is. Not all 401k programs are exactly the same even if generally similar. They'll also know who the main contract for that company is which is basically a free financial advisor who is employed to help you

    • Think "direct line" rather than calling the form who will give you to someone who may not be associated with your company and have just general knowledge of the product line.

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