You should I continue investing in...
http://www.marketwatch.com/investing/fund/rerfx
The company I have has company match, that's the only reason why it even seems appealing. Should I continue invest into it, or just stay out of the 401k game all together?
Even TIME magazine had an article about the death of the 401k. 401k's were companies way avoiding giving employees pension plans. That way, they could make more money because their employees were getting funds for their retirement elsewhere. Of course, 401k's aren't the best managed instruments, and are susceptible to market downturns.
I'm not an expert on them though, so you should stick around for more knowledgeable folks on this forum.
if modern agriculture continues to follow the path it's on now, it's finished. The food-growing situation may seem to be in good shape today, but that's just an illusion based on the current availability of petroleum fuels. All the wheat, corn, and other crops that are produced on big American farms may be alive and growing, but they're not products of real nature or real agriculture. They're manufactured rather than grown. The earth isn't producing those things.. petroleum is! -Masanobu Fukuoka
I think you should invest at least enough to get the company match, its basically free money.
Just the match portion of my 401k, for about 5 years of work is over 20k now, and the stock throws off a 3% dividend (roughly).
Opinions vary on if you should contribute over what the company matches. If you are young, it might make sense to go with a post-tax roth, rather than a pre-tax ira/401k..
Time Magazine is a liberal piece of trash.Originally Posted by BenIsForRon
401Ks allow the individual to take responsibility for his/her own retirement. They were meant to replace the company paid retirement plans that were not portable and are now largely insolvent. This is a much better way to fund retirement then pension plans ever were.
I manage my own 401K, so I don't have anybody to blame for losing money in market downturns, but the bigger point is that the market downturns don't even matter in the short term when you're saving for retirement, a long term goal. Dollar cost averaging means you buy when it's high, you buy when it's low but as long as you keep buying you'll come out ahead.
401(k)s are awesome. I don't know what the OP's company match is, but you should maximize on it. Ours was $1 for $1 IIRC - where else was I going to put my money and double it instantly?
Plus the income tax is deferred. Unless you plan on having a bigger taxable income after you retire than you do while you're working, this could mean you'll only pay 15% in income tax rather than 27% - more money for you.
Like I said, Time Magazine is a liberal piece of trash.
My problem with 401ks is that you are not given many options. Some people literally get 3 funds to choose from. If its my money, why can't I invest in individual stocks?
Because the employer sets up the plan, you don't. And it isn't your money until you retire.
If you want to invest in individual stocks, then go ahead. If you want your employer to offer a plan that allows more options, then crab at her. But if you want to guarantee yourself a healthy guaranteed return, then you should put enough in your 401k to maximize the corporate match.
You shouldn't have all your money in one place anyway.
Looks like a winner to me! The company match is guaranteed return, and it looks like a low cost fund. Good to have an international Euro Pacific fund in your portfolio...
RERFX - Total Expense Ratio: 0.54%
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There are plenty of 401k's that allow dozens of options, get a group of interested employees together and push the company in that direction. On the one hand I agree that money isn't money until it's actually in hand, and 401k's should be thought of as 'paper wealth' and managed accordingly; on the other hand all employee groups would do well to simply tell the employer to stop playing 'matching funds' games and simply compensate the employees the full amounts, and there is absolutely nothing preventing the employee group from negotiating its own 401k if so desired by a majority, choosing the provider and plan of it's choice, and having that tax-deferred status. Such self-governed plans and groups already exist in good number, with no employer directives whatsoever.
Just wondering...
If someone gets a divorce can the Judge rule that the other party is entitled to half of your 401k?
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Probably.
It may depend on how it is set up, I had one company that I could not take out a loan against my 401(k) without a co-sign from my wife, but my current company I can just request the loan.
In a divorce, I don't think anything that the other parties lawyer can think of is out of bounds.
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Yes, it's called a QDRO (Qualified Domestic Relations Order).
Invest up to the match amount in your 401k. If you want to save more than that, open an IRA. Invest as much in retirement accounts because it lowers your AGI and means less taxes you will currently pay to the gubment. You'll have to eventually pay taxes when you retire or hit age 70 1/2, which ever comes first.
If you think tax rates are going to be higher when you retire then open a Roth IRA and invest post tax dollars.
Or blow all of your money on weed and beer.
That's peachy keen. But with the law as it stands now, it behooves both the employer and the employee from a tax standpoint to participate in a 401(k) plan rather than just doling out big chunks of cash.
And like I said now, if you don't like the benefits package your employer offers, go find a different job. It's the way the market works.
From the employer's stand point, it also serves as a tool to retain employees, because you don't get to keep the matching money until you've been with the firm for a while.
I'd be totally pissed if my employee group decided they wanted to abolish my 401(k) to give themselves raises. I'd have a huge tax liability and absolutely no incentive not to spend all the money on booze and strippers.
i'd be surprised if they don't offer a money market type account. if you're uneasy about the equity markets you should still - if you can afford it - take advantage of this and perhaps allocate the funds to the money market account.
years ago when my credit union was finally allowed (by the gov't) to offer 401ks to the employees my input was to make sure that a foreign fund of some kind was included. of course, it has been the best performing - or the least poor performer - of the bunch.
They have a wide variety type of funds, I'll get the list of them and look more into it. I can afford it, but I just don't wanna be wasting my money. Then again, if things really tank that bad, I don't think I will be worrying about money.
If your going to do it. Put in the minimum amount that the company will match. Put yours in something that is safer and if you must "play", do it with what the company pays.
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