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I am very new at investing and admit that my husband and I made a quick and fairly careless decision when first deciding how to invest in his 401K. What I had read/heard is that while you're young you can afford to take more risks so we chose an aggressive growth plan that had the funds already chosen for us(basically I checked the box that said "Aggressive growth"). Now I am trying to get more educated and thought this would be the place to come to read about investing in plain English but this is just not as simple as I thought! In fact, after reading and reading about 401K's I still am not sure what to do and my head is spinning!!
His 401k is managed by Manulife (did I say that right?)and they offer an index stock fund. I thought that that would be a better way to invest our money (especially since we have been losing so much in our current aggressive growth funds). It has an annual investment charge of .60% listed. But here's the thing...Someone posted on 3/22 saying they were trying to figure out what the Manulife index fund is investing in and asking if anyone had any experience with this "psuedo" index fund. The reply scared me and confused me! This is what it said:

you are dealing with a very expensive ANNUITY. Their TOTAL INSURANCE EXPENSE for the quasi 500 index is paltry 1.40%. OUCH!!! Do you know what it
does to your returns?

That's not the end of it. How about SURRENDER CHARGE of 6% in years 1-2, 5% in years 3-4, declining 1% annualy through yr 6. It is imprtant should you part with your current job lets say in 3 years and want to move that money over. They also have $30.- ANNUAL CONTRACT CHARGE.

If there are no matching contributions from your employer you might be better off funding your ROTH first.
Call Maulife rep directly for the specific info regarding specific investments. And while there verify the expenses I gave you earlier. It is highly unlikely you will ever find any relevant information from your employer.

So what does THAT mean?? I am now feeling like I need to know SO MUCH more just to decide how to invest in our 401k and I dont even know where to begin! Also, our 401k is not matching so we arent even sure how much we should even contribute. I read an article today about that (from the home page, I think) but even that did not clarify this issue for me. More mumble jumble about deciding which is going to pay off more but we dont know how to figure that out! My husband is suggesting ROTH IRA because, he says, you never pay taxes on that money but I thought it was best to max your 401k contribution because it lowers your taxable income...HELP!!
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