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Investing/Strategies / Retirement Investing
|Subject: Re: Bad Choices in 401(K)||Date: 7/5/1997 10:39 AM|
|Author: TMFPixy||Number: 105 of 76882|
Greetings, Jason, and welcome to Fooldom.
<<Reading The Motley Fool caused me to review my 401(K). I was shocked, but you of course already knew, that my American Funds 401(K) options
1) Underperform the market by over a third.
2) Have very high maintenance fees.
Other than learning to control my outrage, is there any way (short of changing jobs) to get my money moved to something that at least matches the S&P 500? There has to be some recourse for employees suffering Wise 401(K) administrators...>>
Sad to say, no. Under normal circumstances, until you leave employment by quitting or retiring, the money stays in the 401k. You do want to play in the 401k, though, by putting in enough to get the maximum match provided by your employer. That's an immediate, tax-free, riskless return you can't get anywhere else. Even in poor performing funds, it will take years to offset that advantage in a taxable alternative.
If you feel strongly enough about this issue, you should let you feelings be known to your employer. Ask for more choices like a decent index fund or a self-directed option. More than one plan has seen its investment options change because employees demanded more choice. You know the saws...The squeaky wheel...Nothing ventured...etc. Who knows? You could be successful.
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