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If you’re like most investors, your 401(k) plan is one of your largest assets – if not the largest. So why is it that so many people who are putting away a substantial amount of money for the future don’t really pay that much attention to what it’s invested in, or how those funds are performing?
While there are many tools available to help you fit your investments to your needs, the truth is that by making just a few simple changes, you may catapult the performance of your 401(k), and move yourself closer to your short- and long-term financial goals.
In order to supercharge your 401(k), you should ideally start with the following three tips:
When it comes to the market, we all know that the only constant is change. So, the stock or mutual fund that you chose last year – or even last quarter – may or may not necessarily still be going in the right direction for you. But having an expert take a look at your account on a quarterly basis, and rebalancing when necessary, can keep you on course, both now and down the road.
Avoiding TDFs (Target Date Funds)
Many companies’ 401(k) plans will use Target Date Funds, or TDFs, as their go-to, or “default” option.That’s because TDFs will automatically reallocate as you move through different life stages. But, who ever said that a one-size-fits-all investment works well for everyone? The reality is that Target Date Funds will often underperform and do not do a good job of managing downside risk during tough markets. Is that a risk that you want to take with your retirement assets?
Getting Independent Advice
In most cases, employers “help” their 401(k) plan participants by handing them a brochure that goes over their investment alternatives. But that’s about as far as it goes. So, it’s likely that most – or all – of your 401(k) investments weren’t very well researched before they were chosen for your account. Imagine, though, if each and every dollar in your 401(k) account was invested, based on a strategy that was developed for your specific goals and objectives. That’s what getting independent advice can do.
Because your 401(k) account can represent a significant portion of your overall assets, you want to make sure that you are able to grow it, while at the same time, ensuring that your hard-earned money is well managed during bad market conditions.
401(k) Maneuver™ provides independent advice that helps you rebalance quarterly and avoid target date funds that may not be the best strategy to achieve your goals.