Research stock allocations and then review them

Research stock allocations and then review them


Your 401(k) is not an all or nothing bet. It is an important investment in your future, a tool to enhance your golden years. So, for goodness sake, don’t just let it ride.

More often than not, I find, individuals roll the dice on their future by ignoring their biggest asset. 

Be honest, when it’s time to sign up or change the investment allocations in your plan, how much effort do you make?

A securities analyst colleague just told me he spent 13 seconds making his investment selections. How much research do you do?

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My colleague claims his friends just ask their parents, or him, which investments to select. Many individuals choose investments they know very little about. A pigeon move if ever there was one.

Since 401(k) assets represent 10% of U.S. households’ total financial assets as of the second quarter of 2019, they should command a commensurate amount of your focus. Company websites provide a significant amount of information to participants. Designate an evening to review and discuss with a spouse, a friend or your adviser. 

401k Concept with Money and Arrow

And because 401(k)s enjoy many attributes that enhance the growth of your nest egg, let’s review the benefits:

Dollar-cost averaging ensures that you will continue to buy into markets when they decline, a habit that is difficult to employ as an individual investor but occurs naturally with your 401(k) payroll contribution. Consistently putting money to work in the markets enhances total return over time.


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By Bernice Caldwell

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