401(k): Take Control!
Money is a repository of your labor. No one has greater interest in growing and preserving your money for you than you do. With that knowledge, act on it.
I’ve heard many 401(k) participants ask: “What mutual funds should I invest in? How do I know they’re the best? Can I do it?”
Yes you can!
The purpose of 401(k): TAKE CONTROL! is to provide decision-tools to help you select the best investments from the lineup of mutual funds available in your 401(k) retirement plan. Choosing the right funds adds to income in good times and cushions against losses in down markets. Your goal is to understand fund returns, costs, and risks. Our job is to help.
Our business offers a 401(k). We believe it is beneficial to employees and us. However, we were troubled by the vague, technical, and inadequate training that 401(k) providers gave our employees.
When we found no books, websites, etc. that offered a relevant and detailed introduction to investing, we wrote 401(k): TAKE CONTROL! We knew what our employees needed to understand about 401(k) investing. However, we didn’t assume we knew how our employees should learn. Like many companies our employees have a wide range of educational backgrounds: high school, bachelor, master, and engineering degrees. We took our cue from them. Interaction with employees led to development of seminars and this book.
We don’t just advise diversification, we explain and exemplify real world consequences of “putting all your eggs in one basket.” Furthermore, we don’t just discuss return ratios, cost ratios, and risk measures that are given by 401(k) providers and mutual fund managers, we show in detail how to translate them to readily understandable dollars and use them to make mutual fund investment decisions, given yourpersonal circumstances. Along the way, our employees were WOWED! to learn the huge fees and expenses they paid. We’re confident you’ll be WOWED!, too, to learn the huge fees and expenses you pay. Potentially hundreds of thousands of dollars over your working life. Our employees learned how to avoid being “treated shabbily” by “powerful investment firms.” So can you.
Lydia and Aaron are two employees who search for ways to invest their money. Like millions of 401(k) participants, they are uncertain what to do or even where to start. Lydia was previously burned during a stock-market bubble losing her savings and job. Her colleague, Aaron, is the story’s recently graduated math-phobic narrator.
Mutual Fund Managers buy stocks and/or bonds for their funds. The amount they charge investors is expressed as expense ratios, which are stated in very small numbers, sometimes in thousandths of a percent. They are difficult to interpret.
Providers, also called Bookkeepers, offer employers administrative services. Their fees are stated in very small numbers and are difficult to interpret.
Financial advisors offer individualized investment recommendations. Their costs are stated in very small numbers and are difficult to interpret.
Sponsors are employers. They provide 401(k) opportunities to save pre-tax dollars for retirement. They hire and can fire mutual fund managers and providers.
Participants are employees enrolled in a 401(k). You.
If you are NOT familiar with returns, costs, risks, future value formulas, and spreadsheets, read 401(k) Long. Be sure to include the spreadsheets, RD1 – RD6.
If you are familiar with returns, costs, risks, future value formulas, and spreadsheets, read 401(k) Short. Be sure to include the spreadsheets, D1 – D5. If you get lost, read 401(k) Long.
Click on 401k_take-control below to download the long and short versions of 401(k): TAKE CONTROL! and their spreadsheets.
We hope it helps you as much as it helps our employees. Let us know what you think.
Chauncey M. DePree, Jr., BA, MS, DBA. 23 Waterford Drive, Hattiesburg, MS 39402. firstname.lastname@example.org.
I taught for several decades at universities, retiring with the rank of professor. My academic training was interdisciplinary: BA in Philosophy, MS in Accounting, DBA in Accounting, Logic, and Ethics. (A Doctorate in Business Administration is a PhD at many business schools). I’ve published in the areas of Accounting, Ethics, Finance, Logic, Law, and Operations Research. I’ve successfully invested in the stock market for several decades. I also served as an infantry officer (Captain) in the U.S. Marine Corps.
Rebecca Kathryn Jude: University of Kentucky (B.A. 1970), University of Kentucky (J.D. 1972). Captain, USMC, 1973-1976. Law Clerk to Hon. G. Wix Unthank, United States District Court, Eastern District of Kentucky, Pikeville, 1980-1981. Managing partner, Jude & Jude, PLLC, Hattiesburg, MS. Practice Areas: Environmental and Toxic Tort Law, Employment Law, Corporate Law.
401(k): TAKE CONTROL! Copyright pending. Published by DePree, Inc.