Is it wise to put as little as 5% into a fund in a 401K plan?

Answer 1

Totally depends on your financial goals, and what you are investing in besides your 401k.

If this is your primary or only account for retirement, than 5% is far too little. You will want between 15-18% (that includes employer match)

Answer 2

Yes, by all means do it. And don't ever touch it. If you leave that company take it with you and roll it over into some other type of account and try to keep contributing to it. While you are still with the current company that holds your 401K, contribute whatever they will match. You will do good to go with at least ten percent.You won't be sorry you did. While your buddies are living on tight fixed budgets in their retirement days, possibly still working,(if they still can) you will have a much brighter outlook and much longer financial leash.

The only way I would do 5% is if the company only matched 5%. If this were the case I would even still budget another 5% or greater in some sort of fund with another institution. Say maybe like the MutualFundStore.com . Lots of good solid information.

I'm sorry. I totally misinterpreted your question. After rereading I realized what you were really asking. What ever amount you place where ever you place it depends on what your comfort level is for risk tolerance. That may be good for a young guy wanting to put 5% in a really aggressive fund but it could be really bad for an old guy to do that and lose and then be unable to recoup his losses. There are many variables to take into consideration.
T.

Answer 3

Sure you can do it but you are probably over diversifying - assuming you are allocating the other 95% in funds too. Since you don't pay fees to get into the funds it not that big a deal.

It depends on the total contribution if this makes sense though. If the 5% ends up being a contribution of something like $10 or less, then you are probably over doing it. Just add the 5% to another one of the funds.

Bottom line is to stick with it and maximize your 401k contributions. That will be much more of a factor in the long run than trying to figure out where to allocate that last 5%.

Answer 4

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Answer 5

If you can try to come up with at least 10% you will happy that you did. Especially if your company match what you but in.

Answer 6

Yes.

Answer 7

Yes.

Answer 8

its wise to put anything into one its free money.

Answer 9

Yes, but it would be wiser to contribute more.

Answer 10

anything you put in is better than nothing