401k fee


I don’t like my 401(k) funds but because my employer matches 6% of my pay check, I contribute to the plan to get that matching money. However, watch out because you may lose more than 12% at any time when the market is down and the 2008 economy crisis is an example. I can’t do much with the funds besides relocating my assets which means to put more money in bonds or more in stocks. It is a good idea to learn about finance and re-assess your retirement plan regularly. I check mine once or twice a week but I think once a month is sufficient. Mine takes about 2 days to make any change and I don’t like that delay because 2 days are too long comparing to the fast speed of the market. My investment options just track an established index such as S&P 500 but not to beat against it. Of course going ahead of the market is not an easy game, especially when you are competing with millions of people. Anyway, there are a lot of things that I hate about 401k but I am learning about how to make the most of it.

Any fund in 401k has fees which will reduce the yield of return. When choosing a fund to invest, I always look at the cost of administration and any related fees. Benjamin Graham look at the P/E ratio when picking a stock but the decision should be based on many other factors. There is a booklet published by Department of Labor which tells you the general idea of possible fees in 401k plans. It does not have all the details but it is a good start.

August’s market was too volatile that I did not make any move in stocks. My IVV keeps moving horizontally, side wave-like but not vertically :D. Plus I just moved back to my home state and the work schedule was really busy. Hopefully I can write more regularly because I am all moved in to my new apartment. Yay!!!