A lot of US citizens have made an input of oodles of money in 401 (k) plans. And the fact may be that they are being swindled by the barrel load. But one wonders how that could possibly be.
Well, the vast collection of alternatives that are presented on a menu before you may be one reason. The funds that lie behind these options have high management fees. Sometimes these fees are so astronomically high that they equal the sums saved from the 401 (k) plans.
Some furthermore constituted bad choices. Therefore the low dividends that accrue from these so-called plans for retirement age are a hard fact and ugly truth that no amount of fantasizing and wishful thinking can eliminate.
- One of these is to certify whether you have high consumer debt or not.
- Then you need to get this clear whether your boss is matching your contribution.
- Also you will require a solid sense of self-control necessary for dealing with the investment. You may if you prefer make lemonade if you have been handed a lemon.
- And you may start the titration of your contributions to match your resultant returns on the investment.
- Finally, when push comes to shove there is always self-investment.
The thing is to learn to differentiate between Roth IRA and traditional IRA. That way you will know what to do about your future retirement funds. No one in his right mind wants to play with the future that awaits one after a long and hard life of ethical enterprise.
So that is why one ought to be prepared and remain forewarned concerning 401 (k) plans. They may backfire. Therefore, beware of the economic bog that lies ahead!