Is Your 401k On The Right Course?
Without a 401k check list how would you know if your 401k is on the right course? You wouldn’t, which is why we have come up with a check list for you. If you review your 401k once a year you stand a better chance of reaching your retirement goals. Think of pre-retirement investing and planning as your younger self taking care of your older self.
Your 401k Check List
Enroll in your 401k plan as soon as you start your first job
- Automate your payroll deductions and forget about it
- Contribute the maximum allowed; pre-retirement investing is sending yourself a check for post-retirement
- For 2013, contribute up to $17,000 per year into a 401k if under age 50
- For 2013, if over age 50, contribute up to $23,000
- Set your retirement goal; what will you do once you never have to work again?
- Determine the age you want to retire; the younger the better
- Determine how much time you have left to work and contribute
- Investment risk is a personal thing, learn about yours
- Do you know how much investment risk can you handle?
- Track your investment progress
- Never stop learning about money, the market, investment options
- If necessary, seek financial advice on the investments in your 401k
- Welcome feedback on your investment style, you don’t know it all
- Choose an investment model that fits your personality not someone else’s
Your 401k investing is about you, don’t try to keep up with neighbors, co-workers, family and friends. The investment curse is following someone else’s investment model not your own. In life there are situations that demand competition; your 401k investing is not one of those situations. There is too much at stake to be competitive with others when tracking your 401k account. The only money that will be there at your retirement will be the money you send ahead. If you are playing the competition game with your money during the years you should be squirreling as much as possible away you could lose it all. Is that what you want? Probably not. Invest early, invest often and your older self will be proud of your younger self.