Keep tabs on your 401(k) to prevent mistakes

The Ticker

June 14, 2000|By JULIUS WESTHEIMER

Do you keep a close eye on your 401(k) account? Individual Investor, July, says, "Watch your 401(k) diligently, making sure your boss isn't raiding your account.

"During the past five years, the Department of Labor conducted over 4,850 investigations into the mismanagement of 401(k) plans and recovered more than $88.9 million in delayed or lost contributions.

"Suggestions: Check your records against statements your company provides. ... If the plan is managed by a mutual fund, you can call its 800 number or log onto its Web site. ... Read the fine print. ... Watch how quickly colleagues are able to withdraw or roll over their money. Be especially vigilant if your company merges."

Speaking of your 401(k), Family Money, July-August issue, says, "Although employers rarely advise on how to make the most of your 401(k), you can manage your plan the way professionals do by following these principles: Rebalance your portfolio from time to time, lowering your stock percentage when the market appears too high. ... Diversify your investments. ... Avoid heavy doses of company stock. ... Use some index funds tied to recognized stock averages."

WALL STREET WATCH: "We've seen the worst of this year's selloff, but I worry about next year with a new President. However, don't abandon the stock market this year. People get hurt trying to outguess market swings." (The Prudent Speculator, in this week's Barron's)

"This is a Presidential election year, and historically that's bullish for the market. Maybe this rally will last longer and go higher." (Richard Schwartz's Stock Market Principles)

"After three months of weakness, tempting bargains are now available in almost every major growth sector." (U.S. Investment Report)

"Over the past century, rising interest rates eventually killed off sharply rising stock markets." (Charles Allmon, Growth Stock Outlook)

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