2007-08-09 16:25:26 · 6 answers · asked by momekool 1 in Business & Finance ➔ Personal Finance
I assume you are asking how to make investment choices in your 401K. There is no easy answer. There is no such thing as a "safe" investment. For the long-run, historically cash has been an unsafe investment because the returns can't match the yearly cost-of-living increases. Bonds are considered safer than stocks, but you can lose money in the bond market, and you run the same risk of low returns as cash. Historically, stocks have outperformed cash and bonds over time, but you always run the risk of losing money when you buy stock investments.
If you are willing to educate yourself and put some time into it, you can make the 401K choices yourself and do fine. Yahoo! Finance has some great resources to help (see link, below).
Some experts recommend casual investors pick the "balanced" funds; these are funds that have a mix of stocks and bonds and automatically become more conservative the older you get (examples: Vanguard LifeStrategy Growth Fund (VASGX), Fidelity Advisor Freedom 2030 (FAFEX)). The advantage is that the fund manager chooses all the investments for you.
If you're portfolio is $50K or more, I suggest you hire a fee-only financial planner to make the investment choices for you. A good financial planner will take the time to understand your risk tolerance and financial goals, then work with you to achieve those goals.
Good luck
2007-08-10 10:58:58 · answer #1 · answered by jstephenmoore 2 · 0⤊ 0⤋
Keep the money in the account. The fees in a 401K are less than 1%. rolling over to an IRA increases the fees by at least 1%. Over time, that would amount to tens of thousands of dollars you would lose until you retire.
2007-08-09 19:39:21 · answer #2 · answered by Steve R 6 · 0⤊ 0⤋
Are you no longer with the company? If so, roll it over into an IRA. Whatever company is handling the 401K should be able to set up the IRA with the same investments.
2007-08-09 16:29:26 · answer #3 · answered by bdancer222 7 · 1⤊ 0⤋
A cd or t-bills or maybe municpal bonds are very safe. They also return very little but if safety is the prime concern go with something that is government backed.
2007-08-09 16:29:47 · answer #4 · answered by Slumlord 7 · 1⤊ 0⤋
Invest in Lottery in Nigeria!
2007-08-09 16:34:03 · answer #5 · answered by R.M. 61 2 · 0⤊ 0⤋
put into cd's or govt back bonds!!!!
2007-08-14 07:30:30 · answer #6 · answered by mister ed 7 · 0⤊ 0⤋