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By now most of us have either started completing our taxes or will do so very soon and perhaps at the same time are also reviewing the status of our 401k’s. After the past two years roller coaster ride on the stock market, some of us might even be feeling pretty good about how our investments have recovered or maybe even are above the early 2008 levels.
In thinking about our own 401k, and how well we recovered, we thought we should share some of the strategies that have help us weather the storm over the past two years. We created this blog to do just that and over the next series of posts we will discuss various strategies that worked for us, as well as some of own personal issues with mutual funds, the fees they charge and the poor performance they have delivered.
Add Your Own Comments about Your 401K
Every post will provide an opportunity for our readers to leave comments. In fact we invite readers to tell us what they think of our thoughts, tell us their own experiences and also point out issues that we may have missed or treated more lightly than they should. The end of every post will provide an opportunity for readers to leave their comments.
Investment Mantra
You probably have heard the mantra – diversify, avoid placing all of your investments in one area, hire experts to manage your money, review and follow mutual fund performance to ensure that you are invested with an excellent performing fund. Of course almost in the same breath, your broker or investment adviser also tells you that past performance is not an indicator of future performance and they cannot predict the long term direction of the market let alone short term gains and losses.
How is one suppose to navigate this complex financial world were brokers and trading firms get very rich and your 401K is barely above water? Well we are going to collect many of the tips and good common sense ideas and post them on this blog. Armed with this information we are hoping that investors like you and I will be better off as we try to save money for our retirement and live the life we always planned when it comes time to walk out the door the very last time from our place of work!
Topics Planned for the 401k Blog
Some of the general areas we hope to blog about over the next year are shown below. Please note that this is a general list and as readers comment and we read about various events taking place in the market we may vary this list some what. If you see something missing let us know and we will be glad to add it. For now, here is our planned blogging list of topics in no particular order:
- Basics of Investment Planning
- How does one achieve diversity?
- Why are mutual funds so popular?
- What are the real costs of mutual funds?
- Hiring investment advisers.
- Paying attention to your statements.
- Saving for Retirement
- 10 % Investment plan
- Retirement Planning
- Consolidating investments
- Financial Rules to Follow
- How much do you need to retire
- Life after 65
- Extreme Savers
- Steps to Follow to Test Your Plans
- Balanced Budget – Stress Test Your Budget
- 401k retirement goal – Stress Test Your Plan
- Issues to Think About
- Americans Uncertain About Meeting Retirement Goals
- Long-Term Financial Planning Key To Lasting Relationships
- Getting ready for retirement
- Interest Rate Fluctuation
- What Life Stage are you in Financially
- 10 Years to Retirement are you ready
- Retiring with debt
- How will you pay for that? Sources of retirement income
- How will you make your money last
- Financial needs of baby boomers
- Older workers planning not to retire
- Working Past 70, You Cannot be Serious
- Balance Finances, Health and Wealth
- Early Retirement Secrets
- Secrets to Retirement planning
- Age 60-Do You Have Enough for Retirement
- Discuss Finances with your Spouse
- When Should You Retire
- What will I do In Retirement
Why Do the Experts Still Get Paid
One of our pet peeves along with many other people is the fees that are charged on mutual fund plans and to a lesser extent the fees charged on stock trades by the large brokerage houses and insurance companies! When was the last time you got paid a bonus for poor performance? That’s exactly what we think the massacre on the stock market was in 2008. We won’t discuss the cause of the crash and the fall of our economy. There are lots of theories and ideas about what caused that.
The real question as an investor that I have is what were the investment advisers doing at the time. These are the so called experts who are supposed to see these kinds of changes in the market coming and advise us to take the appropriate action before it happens. You know, sell high and buy low! We were all led like a bunch of lemmings over the brink and into one of the most significant losses on the market in recent history. These so called experts could not prevent this from happening and they could not prevent you from losing a lot of your hard earned savings. So what is the answer to this dilemma?
What Should We Do?
Get involved with your investments, ask the tough questions, educate your selves and make these advisers work for their money. Just as important watch the mutual fund expenses and tailor your investments to minimize these fees. Sure there are lots of initiatives to try to make the mutual fund industry more accountable and charge smaller fees, however this is your money we are talking about and by the time some of these initiatives get put in place (if they do) you are going to be facing retirement on what you have.
Take some level of control now and get involved with your 401k plan and your retirement. On this blog we hope to provides lots of tips and ideas for doing that. Now this is were we are going to sound like one of those advisers that we talked about. We cannot guarantee success and there is not one specific formula that will protect your investments. There are a collection of concepts and approaches that we will discuss in this blog which you will have to apply to your specific situation, stage in life and financial position. Good luck and watch for our next post.