Defined-benefit pension plans are shrinking in number. So mow more than ever retirement funds and saving for retirement has started to become a responsibility of the employers. Many employers are now switching over to plans such as the 401(k), which are defined contribution plans.
1. How good is the 401(k) match? If your employer offers employer match, the smartest move is to at least contribute enough money into your account to take advantage of the funds that your employer can pitch in. To determine how much exactly you should contribute to your funds, look up information on the costs and quality of the investment options you have.
2. How much money am I paying in admin fees? Keep track of how much money you are paying in administrative fees. One way to really hurt yourself is to pay too much in fees and diminish your funds. To be able to find out how much your paying in admin fees is to look at your plan’s annual report. It’s important to make sure you’re still saving enough for your retirement and not spending it all on fees.
3. How did you choose the investment plans? Ask your employer if their selection process include any specific criteria when looking for an investment plan? Did they look for a specific performance or relative expenses?