Comments on: 12 Mistakes to Avoid With Your Retirement Savings Plan http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/ Helping a unique generation achieve financial independence. Sat, 20 Mar 2010 15:15:15 +0000 http://wordpress.org/?v=2.9.1 hourly 1 By: Michael http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-78525 Michael Sat, 05 Jul 2008 16:35:18 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-78525 NO, NO, NO!!! The 401k/457b/403b is a scam until you've maxed out an IRA. If you plan on retiring with the MAJORITY of your 401K/457b/403b doing the heavy lifting you may think twice. You need ten, "10" times the yearly income of your last year in work to meet the basic necessities of retirement. So if you make $65K a year that's $650K or $26K a year for 25 years. Problem is the make contribution is only $15.5k... Do the math, the public has been scammed by the financial engineers of Wall St. and corporate America. NO, NO, NO!!!

The 401k/457b/403b is a scam until you’ve maxed out an IRA. If you plan on retiring with the MAJORITY of your 401K/457b/403b doing the heavy lifting you may think twice. You need ten, “10″ times the yearly income of your last year in work to meet the basic necessities of retirement. So if you make $65K a year that’s $650K or $26K a year for 25 years. Problem is the make contribution is only $15.5k… Do the math, the public has been scammed by the financial engineers of Wall St. and corporate America.

]]> By: liferules.org http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-78252 liferules.org Wed, 02 Jul 2008 19:03:58 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-78252 Great tips! I think people blindly think that dumping money into their 401K and forgetting about it without managing it properly will guarantee them fiscal success later on. Thanks for reminding us that is not the case. Great tips! I think people blindly think that dumping money into their 401K and forgetting about it without managing it properly will guarantee them fiscal success later on.

Thanks for reminding us that is not the case.

]]> By: Genesis Bible http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-76802 Genesis Bible Tue, 17 Jun 2008 01:32:32 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-76802 man ... nice tips! indeed avoid procrastination at all costs man … nice tips! indeed avoid procrastination at all costs

]]> By: Happy Thanksgiving! A Trip Through the Archives : Generation X Finance http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-39529 Happy Thanksgiving! A Trip Through the Archives : Generation X Finance Wed, 21 Nov 2007 18:40:59 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-39529 [...] 12 Mistakes to Avoid With Your Retirement Plan - We all know that we should be saving for retirement, but there are a few things you should really avoid even if you are saving. [...] [...] 12 Mistakes to Avoid With Your Retirement Plan – We all know that we should be saving for retirement, but there are a few things you should really avoid even if you are saving. [...]

]]> By: Jeremy http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-12340 Jeremy Thu, 12 Jul 2007 02:00:43 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-12340 Thanks for catching that typo Leigh, it should be corrected now. Thanks for catching that typo Leigh, it should be corrected now.

]]> By: Leigh Cromleigh http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-12320 Leigh Cromleigh Wed, 11 Jul 2007 23:00:24 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-12320 The penalty for early withdrawl is prior to age 59 1/2 not 15 1/2. Thanks. The penalty for early withdrawl is prior to age 59 1/2 not 15 1/2. Thanks.

]]> By: The Simple Dollar » The Simple Dollar Morning Roundup: Generation X Finance Edition http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-12078 The Simple Dollar » The Simple Dollar Morning Roundup: Generation X Finance Edition Tue, 10 Jul 2007 13:30:17 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-12078 [...] 12 Mistakes To Avoid With Your Retirement Savings Plan I’ve made at least one of these mistakes in the past: timing the market. I actually thought it was dumb to invest in stocks when I first started my 401(k) in 2002 because they had been collapsing so badly for the previous two years. I should have bought in with gusto. [...] [...] 12 Mistakes To Avoid With Your Retirement Savings Plan I’ve made at least one of these mistakes in the past: timing the market. I actually thought it was dumb to invest in stocks when I first started my 401(k) in 2002 because they had been collapsing so badly for the previous two years. I should have bought in with gusto. [...]

]]> By: The Personal Finance Blog You Can Invest In - Money Blog Site Elite 8 » http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-1776 The Personal Finance Blog You Can Invest In - Money Blog Site Elite 8 » Wed, 21 Mar 2007 21:07:13 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-1776 [...] (4) Money Smart Life vs. (10) Gen X Finance [...] [...] (4) Money Smart Life vs. (10) Gen X Finance [...]

]]> By: Rajnikant patel http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-853 Rajnikant patel Sun, 21 Jan 2007 14:24:42 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-853 very interesting article, it is like chewing 12 sweet toffees, a reader commented on 13th mistake as well. Good very interesting article, it is like chewing 12 sweet toffees, a reader commented on 13th mistake as well. Good

]]> By: Jeremy http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-164 Jeremy Thu, 30 Nov 2006 22:22:56 +0000 http://genxfinance.com/2006/11/30/12-mistakes-to-avoid-with-your-retirement-savings-plan/#comment-164 Well loans aren't the worst option, but it is often too easy to get a loan and then the repayment plans are painfully slow. On some plans, as long as 10 years. So while someone may only borrow say $5,000, if you spread repayment back over the course of 5 or 10 years you have missed out on a lot of potential compounding. What is even worse is that many employees, at least those who are younger rarely stay with the same company for extended periods of time. These people who take out loans and then leave the company before it is repaid more often than not I see people not repaying the loan and then taking the tax hit. Then not only did they miss out on growth, but they effectively took an early withdrawal. And I thought about what you suggested for 13, but since it is about a 50/50 chance of being a mistake I didn't put it in. In some cases you certainly end up rolling your money into a new employer plan that does have high fees and not as many options, there are many other cases where this may not be the case, especially if moving to a large organization. Larger companies typically work with companies like Fidelity, which offer many great low-cost options or offer what are typically load funds as institutional funds which have no loads and can have low fees. Of course this varies greatly by plan, which is why anyone changing jobs should throughly research their new plan to be sure they make the right decision. Well loans aren’t the worst option, but it is often too easy to get a loan and then the repayment plans are painfully slow. On some plans, as long as 10 years. So while someone may only borrow say $5,000, if you spread repayment back over the course of 5 or 10 years you have missed out on a lot of potential compounding.

What is even worse is that many employees, at least those who are younger rarely stay with the same company for extended periods of time. These people who take out loans and then leave the company before it is repaid more often than not I see people not repaying the loan and then taking the tax hit. Then not only did they miss out on growth, but they effectively took an early withdrawal.

And I thought about what you suggested for 13, but since it is about a 50/50 chance of being a mistake I didn’t put it in. In some cases you certainly end up rolling your money into a new employer plan that does have high fees and not as many options, there are many other cases where this may not be the case, especially if moving to a large organization.

Larger companies typically work with companies like Fidelity, which offer many great low-cost options or offer what are typically load funds as institutional funds which have no loads and can have low fees. Of course this varies greatly by plan, which is why anyone changing jobs should throughly research their new plan to be sure they make the right decision.

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