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Message: <blockquote data-quote="Heretic Apostate" data-source="post: 273790" data-attributes="member: 696">401(k)sSome tips.1)  Diversify.  This is what killed off the retirement plans of the Enron employees.  Their company's stock was so great, they thought that it was a sure deal.  But remember, if your company goes under, not only do you lose your source of income, but all the money you invested in their stock is gone, as well.2)  As I've found out, the hard way, when you leave a company, they'll typically cash out your 401(k).  So, if you don't want to go through the hassle I went through, have the check made out to your financial advisor, operating as your agent.  Otherwise, the IRS takes out a huge chunk, and you have to argue to get it back.3)  As stated above, expect the company to cash out your stock.  In my case, the two times I've had a 401(k), it's been cashed out when the stock was at a low.  Oh joy, I pay in $70 per share, and I get out $45 per share.  So, don't expect to invest for the long term.  Try to find mutual fund stocks (mutual funds because they diversify already) that are stable.4)  If you're going to get a financial advisor, try to find one who can pick winners when the market is soaring.  When the market was soaring, my stocks went down.  When the market dropped, my stocks went down even more.  Blech.5)  Pick your risk.  Generally, your portfolio should be in stocks to about 90% when you're in your early 20s, down to about 10% when you're in your early 60s.  Don't do what a lot of woulda-been-retirees did, and keep your investments in stocks because the stock market was doing so well.  OVER TIME, the stock market as a whole will outperform any other investment.  The big things are time and diversity.  If you're nearing retirement age, get out of the stock market!  If you're young, you have time to recover from market problems.  (Now is a great time to find bargains, if you can find one not corrupted by accounting scandals....)  As for diversity, you should be investing in big companies, small companies, U.S. companies, foreign companies, emerging market companies, tech stocks, blue chip stocks, a little of this, a little of that.  If you're too concentrated in one area (for example, I NEVER bought any tech stocks, thus I wasn't hurt any more than usual by the tech stock downturn; I never believed those dot-coms were going to survive), you're too vulnerable.6)  If you have the money, go with bonds, stocks, certificates of deposit, mutual funds, treasury bills, and so on.  Keep some money liquid (I'd say six months of your income is a safe bet) for emergencies, so you don't have to sell at a loss.7)  Don't borrow against your 401(k).  401(k)s are pre-income-tax money (100%).  If you borrow against it, you're spending money that's post-income-tax (80%) to pay off the loan.  It's probably cheaper to use a credit card.8)  Get into IRAs, as well.  IRAs YOU control, not the company.  I, personally, have a Roth IRA.  I pay taxes on it, but it's tax-free when I take it out when I retire.  You're able to save up to $3,000 a year now.  I think that'll increase up to $5,000, but I'm not sure.  (It's hard to do, I know.  I can barely manage $2,000 a year.  Try dedicating your income tax return to it, that'll help some.  If you can get the money taken directly out of your paycheck, it's easier.)Argh, there's lots more that I could say on this subject. <img src="https://cdn.jsdelivr.net/joypixels/assets/8.0/png/unicode/64/1f642.png" class="smilie smilie--emoji" loading="lazy" width="64" height="64" alt=":)" title="Smile    :)"  data-smilie="1"data-shortname=":)" /></blockquote>

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