Comments on: How to Tell if You Have a Bad 401k Plan http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-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: Dean Voelker http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-129342 Dean Voelker Thu, 18 Mar 2010 20:31:53 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-129342 Hi Sheila, You bring up some great points. One of the biggest things wrong with today's 401(k) plan is the lack of education given to employees on how to use the plan. Penelope Wang of Money Magazine has an article from the March 2010 issue "What To Do With A Bad 401(k)". She mentions that all plans have some flaws, with funds and fund management fees. There are new regulations but many employers haven't learned them yet. As an advisor, one question I ask on 401(k) reviews is "What process are you using to frequently review the funds in your plan for performance and fees as they compare to their peers?" There has to be a monitoring system in place. I compare this to 'bananas'. What happens if you let bananas sit too long? Well, in a 401(k) plan, you always want the 'freshest' and least costly bananas. I have a book coming out, "Help! My 401(k) Has Fallen - And Must Get Up!" This book is written in layman's terms to help people just like you to get more out of their long term savings. You can visit my website also for a free report, "The 5 Biggest Problems With 401(k) Plans". I hope I may be able to help. Hi Sheila,
You bring up some great points. One of the biggest things wrong with today’s 401(k) plan is the lack of education given to employees on how to use the plan. Penelope Wang of Money Magazine has an article from the March 2010 issue “What To Do With A Bad 401(k)”. She mentions that all plans have some flaws, with funds and fund management fees.

There are new regulations but many employers haven’t learned them yet.

As an advisor, one question I ask on 401(k) reviews is “What process are you using to frequently review the funds in your plan for performance and fees as they compare to their peers?” There has to be a monitoring system in place.

I compare this to ‘bananas’. What happens if you let bananas sit too long? Well, in a 401(k) plan, you always want the ‘freshest’ and least costly bananas.

I have a book coming out, “Help! My 401(k) Has Fallen – And Must Get Up!” This book is written in layman’s terms to help people just like you to get more out of their long term savings. You can visit my website also for a free report, “The 5 Biggest Problems With 401(k) Plans”. I hope I may be able to help.

]]> By: Sheila http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-124039 Sheila Wed, 13 Jan 2010 12:34:11 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-124039 Although my employer has a match and offers a selection of funds, the vesting schedule for their plan doesn't reflect reality. These articles ignore the fact that all of these plans have very long vesting schedules. If it takes 6 years to get your money, and in the meantime the majority of employees no longer stay with a company for more than 2 or three years on average, isn't this all just a big fat phoney shell game designed to delude employees into thinking they're getting something they're not? In addition, employers don't fulfill their responsibilities when it comes to offering investing classes. They pre-select the funds for YOU and assume we're all dummies that need to be led by our noses. They determine how your money is invested without any input from YOU. This infuriates me. Currently my employer offers few funds, and all funds which have underperformed the market for 6 years! I have a better track record of investing my own money but my employer also doesn't offer a self-directed option. Time to get rid of the entire 401K model and let people defer 15% of their own income themselves and receive a yearly contribution from the employer. The 401K plan is obsolete and does a disservice to most employees. It needs major legislative overhaul or needs to be chucked. Although my employer has a match and offers a selection of funds, the vesting schedule for their plan doesn’t reflect reality. These articles ignore the fact that all of these plans have very long vesting schedules. If it takes 6 years to get your money, and in the meantime the majority of employees no longer stay with a company for more than 2 or three years on average, isn’t this all just a big fat phoney shell game designed to delude employees into thinking they’re getting something they’re not? In addition, employers don’t fulfill their responsibilities when it comes to offering investing classes. They pre-select the funds for YOU and assume we’re all dummies that need to be led by our noses. They determine how your money is invested without any input from YOU. This infuriates me. Currently my employer offers few funds, and all funds which have underperformed the market for 6 years! I have a better track record of investing my own money but my employer also doesn’t offer a self-directed option.

Time to get rid of the entire 401K model and let people defer 15% of their own income themselves and receive a yearly contribution from the employer. The 401K plan is obsolete and does a disservice to most employees. It needs major legislative overhaul or needs to be chucked.

]]> By: sandy http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-122609 sandy Fri, 23 Oct 2009 02:33:11 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-122609 hello,our company sold out to a privet owner they then reinvested my 401k with their investers ??. then layed us off indeffently.. how should i handle this?? what are my opptions hello,our company sold out to a privet owner they then reinvested my 401k with their investers ??. then layed us off indeffently.. how should i handle this?? what are my opptions

]]> By: Best Personal Finance Posts in 2008 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-120432 Best Personal Finance Posts in 2008 Tue, 02 Jun 2009 21:39:36 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-120432 [...] How to Tell if You Have a Bad 401k Plan [...] [...] How to Tell if You Have a Bad 401k Plan [...]

]]> By: arthur l howle http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-107893 arthur l howle Thu, 26 Feb 2009 02:53:50 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-107893 I was terminated from my job Oct.2008 I was contributing to a company 401 k but only had done so for 2 years/ I am 63 years old. I contacted the 401k principle group to do a direct rollover of my entire acct. to a IRA/CD all of the funds were transferred except $1500.which princple group said belonged to an acct that was frozen until funds could be released. does this sound legal. Am I able to apply for this balance under the harship rule since I lost my job? please advise. Art Howle I was terminated from my job Oct.2008 I was contributing
to a company 401 k but only had done so for 2 years/
I am 63 years old. I contacted the 401k principle group
to do a direct rollover of my entire acct. to a IRA/CD
all of the funds were transferred except $1500.which
princple group said belonged to an acct that was frozen
until funds could be released. does this sound legal.
Am I able to apply for this balance under the harship
rule since I lost my job? please advise. Art Howle

]]> By: What to Do About a Lousy 401(k) Plan | Retirement News Blog http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-106952 What to Do About a Lousy 401(k) Plan | Retirement News Blog Thu, 19 Feb 2009 02:58:02 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-106952 [...] Jeremy at GenerationXFinance, who works as a retirement planning specialist, provides a couple of red flags to help you determine if you’re in a lousy [...] [...] Jeremy at GenerationXFinance, who works as a retirement planning specialist, provides a couple of red flags to help you determine if you’re in a lousy [...]

]]> By: What to Do About a Lousy 401(k) Plan | 401k News Blog http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-106663 What to Do About a Lousy 401(k) Plan | 401k News Blog Tue, 17 Feb 2009 15:05:26 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-106663 [...] Jeremy at GenerationXFinance, who works as a retirement planning specialist, provides a couple of red flags to help you determine if you're in a lousy [...] [...] Jeremy at GenerationXFinance, who works as a retirement planning specialist, provides a couple of red flags to help you determine if you’re in a lousy [...]

]]> By: Moments of fame « Funny about Money http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-82808 Moments of fame « Funny about Money Thu, 14 Aug 2008 16:59:15 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-82808 [...] in declutter mode. Two bloggers raise questions about 401(k) plans: Generation X Finance explains how to tell whether your plan sucks, and No Debt Plan raises the possibility of discontinuing his [...] [...] in declutter mode. Two bloggers raise questions about 401(k) plans: Generation X Finance explains how to tell whether your plan sucks, and No Debt Plan raises the possibility of discontinuing his [...]

]]> By: What Do You Want to Know About Me? | Steve Rhode http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-82388 What Do You Want to Know About Me? | Steve Rhode Mon, 11 Aug 2008 16:37:58 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-82388 [...] How to Tell if You Have a Bad 401k Plan at Generation X Finance [...] [...] How to Tell if You Have a Bad 401k Plan at Generation X Finance [...]

]]> By: Weekend Roundup - 08/10/2008 | The Family Wallet http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-82251 Weekend Roundup - 08/10/2008 | The Family Wallet Sun, 10 Aug 2008 09:40:44 +0000 http://genxfinance.com/2008/07/29/how-to-tell-if-you-have-a-bad-401k-plan/#comment-82251 [...] Generation X Finance provides details on how to tell if you have a bad 401k plan. [...] [...] Generation X Finance provides details on how to tell if you have a bad 401k plan. [...]

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