how much retirement money is in 401(k) plans and how is it invested?
151315
All plans have rules to become eligble first. When can I enroll in the Plan?\nYou must be 21 years old and have completed at least one year of service with the Company to join the Plan. Then you contribute savings and the company usually has a sliding matching scale  How much can I contribute?\nThrough automatic payroll deduction, you can contribute between 1% and 25% of your eligible pay on a pretax basis, up to the annual IRS dollar limits.  Does the Company contribute to my account?\nThe Company helps your retirement savings grow by matching your contributions.\n(This is from my plan yours will be different)\n"Your company" will contribute $1 for every $1 on the first 3% of pretax pay you contribute, and $.50 for every $1 on the next 2% of pretax pay you contribute. You can access it on-line and change how it is invested  What are my investment options?\nTo help you meet your investment goals, the Plan offersyou a range of options. You can select a mix of investment options that best suits your goals, time horizon and risk tolerance. The  investment options available through the Plan include conservative, moderately conservative, and moderately aggressive funds. A complete description of the Plan's investment options and their performance, as well as planning tools to help you choose an appropriate mix, are available.\n\ngo to link to learn more and talk to your benefits manager where you work!
375091
If you are looking for a federally insured plan to invest in, you can also get into a money market, a certificate of deposit, or a high-yield savings account.  Also, Savings Bonds and Treasury bills, but these are really long-term investments (10+ years) and the rate of return is questionable right now.\n\nBy the way, it is important to distinguish between investment products (ie. CD's, Money Markets) and investment plans (ie. IRAs, 401(k)s).  The distinction is that the plan is the governing account and the product is what actually makes you the money.  So your plan is the 401(k) but the product might be mutual funds. \n\nAlso, look out for Federal insurance on your investment products.  For example, you could have an IRA that is not insured if you are investing in mutual funds and a 401(k) that is insured if you are investing in a Money Market.  \n\nIf insurance is your biggest worry, just ask your bank or investment house whether the product you are funding is insured.
1186755
Automatic savings.  Open an IRA for retirement and automatically have $200 per month taken out of your pay and put in that account until you max out on the yearly limit.  You could even more than $200 in now, since the year is half over.\n\nPay yourself first.  You can't spend it if you never see it.  Your old self will thank the smart young self that started saving.
852348
Not sure where these other clowns are getting their information, but allow me to clarify some information:\n1.  Check to see what types of investments you are being placed into.  If it is a managed stock and bond portfolio (not mutual funds, annuities or insurance anything), 1.9% is certainly a fair fee so long as it includes market trades, and expert manager (with a track record) another expert looking at the economics, and the ability to have tax flexibility.  While 1.9% sounds expensive, mutual funds (yes even vanguard), including transaction costs can run from 1.25%-3% no matter how much money you have invested with them not to mention some even carry added commissions! (see www.personalfund.com).  Annuities are mutual funds plus insurance so add another .75-1.5% to the underlying funds on personalfund.com and you will see that most people are paying about 3.5% to have their money managed through annuites.  Typically with fee based planners as your assets go up in value so does the dollar amount of their fee, but the actual percentage goes down, which is not the case with mutual funds, not even vanguard.\nManaged stock accounts do allow you to control taxes much better than mutual funds as well.  Don't forget that the financial planner wants to see your fee go up in dollars, if is based on a percentage, then as your account grows, so will his fee.  If it continues to grow the percentage will drop, but the fee will continue to grow.\nSee if your financial planner is actually a financial planner.  If he doesn't have the letters CFP somewhere after his/her name, he ain't a planner.  But being a CFP doesn't mean squat if they aren't adding value (reducing taxes and risk while increasing returns and goals).  He should be meeting or willing to meet with your CPA and attorney.\n1.9% is high if you are investing in bonds, money market, savings accounts, or something that is guaranteed to pay a certain amount. 1.9% doesn't mean squat to someone who has annualized returns net of fees of 15% for the past 10 years with less risk than the S&P500, that is powerful money making.  If they aren't getting the returns and you have time to do it yourself, then you can find cheaper, but not necessarily better.\nBe cautious.  I have heard of some "advisors/planners" who charge an annual wealth manager fee and say their products don't make them any money, but then put clients in "safe-guaranteed" investments that don't charge commission when in reality they are annuities that pay 10-14% to the broker and the client is told they are free.
132052
A 401k is an employer sponsered retirement account.  Employers will offer severel differet mutual funds that you will pick from to invest your money.  The money is taken from your paycheck on a weekly basis and put into the mutual fund for you.  The good part of a 401k is that an employer usually matches your contribution.  Sometimes a dollar for dollar match.  Meaning that for every dollar you put into your retirement account, your employer will also put in a dollar.  And other times your employer will match only a fraction of what you contribute, (ex. You put in a dollar, employer puts in .35 cents).\n\nThe money you put into your 401k goes in tax free.  So you won't have to pay taxes on the your income that went into the account.  However, when you're retired and you begin to withdraw money from your 401k, that is when you'll have to pay the taxes, on all your withdrawls \n\nBe warned, if you leave the company, you may not be able to keep the money that your employer put into your account for you unless you've been with the company for a certain number of years.  This is called being vested.
124482
I agree with the previous answers as a method to make your investments. Does your employer offer a 401(k) or other savings plan? If not, try calling a company like Fidelity or Vanguard mutual fund and ask about an Automatic Investment Plan.\n\nTo achieve an appropriate investing 'mindset' for long-term investing in U.S. stocks, it may help to look at a chart of the dow jones average over the years 1928 through 2005. You'll see a graph with a line that increases with time (i.e., average returns of roughly 10% per year). This shows that the U.S. economy/stock market was able to bounce back from an economic depression, various recessions, rampant inflation, and various wars/conflicts. As an investor in the U.S. stock market, this information helps me to sleep at night.
129902
As the other answerer mentioned, there are two\nsituations:\n\n  1) \n     You rolled the 401k over from a previous employer's\n     plan into either your new employer's plan or\n     into a private 401k account (ie. at Fidelity or\n     Ameriprise or something like that).\n\n     In that case, it is not considered a withdrawal\n     and there are no taxes involved.\n\n     As I recall, you have something like 60 days\n     from when you remove it from one plan before\n     it must be placed into another.  Keep your \n     records in case the IRS checks up on you :-)\n\n  2) \n     If you withdrew the money and just kept it in\n     a bank account, you not only have to pay taxes\n     on it, but you'll probably have to pay a \n     penalty as well.
931150
Walk into your local bank... go to new accounts.. and open a Roth IRA. They will gladly take your money and put it in the risk level of IRA's that they have.... just go outside your current 401k. \nMy company matches 10% of what I put into my 401k. It would be foolish for me to not put in that amount. If it was a crappy 401k, I'd only put in what am mount that they matched, and then put the rest into a Roth.
562118
Basically, You have to pay the tax plus a 10% penalty\nTopic 424 - 401(k) Plans\n\nA section 401(k) plan is a type of tax-qualified deferred compensation plan in which an employee can elect to have the employer contribute a portion of his or her cash wages to the plan on a pre–tax basis. These deferred wages (commonly referred to as elective deferrals) are not subject to income tax withholding at the time of deferral, and they are not reflected on your Form 1040 (PDF) since they were not included in the taxable wages on your Form W-2 (PDF). However, they are included as wages subject to social security, Medicare, and federal unemployment taxes. \n\nThe amount that an employee may elect to defer to a 401(k) plan is limited. Therefore, your elective contributions may be limited based on the terms of your 401(k) plan. Refer to Publication 525, Taxable and Nontaxable Income, for more information about elective deferrals. Employers should refer to Publication 560, Retirement Plans for Small Business, for information about setting up and maintaining retirement plans for employees, including 401(k) plans. \n\nDistributions from a 401(k) plan may qualify for optional lump–sum distribution treatment or rollover treatment as long as they meet the respective requirements. For more information, refer to Topic 412, Lump–Sum Distributions, Topic 413, Rollovers from Retirement Plans, and Topic 555, 10–Year Tax Option for Lump–Sum Distributions.\n\nMany 401(k) plans allow employees to make a hardship withdrawal because of immediate and heavy financial needs. Generally, hardship distributions from a 401(k) plan are limited to the amount of the employee's elective deferrals only, and do not include any income earned on the deferred amounts. Hardship distributions are not treated as eligible rollover distributions. \n\nDistributions received before age 59 1/2 are subject to an early distribution penalty of 10% additional tax unless an exception applies. For more information about the treatment of retirement plan distributions, refer to Publication 575, Pension and Annuity Income.
13955
1.  401(k) is like a scooter.  You're company that you work for provides you this savings plan. The company selects who administrates the savings account (where you park your car) which investments you can have (which road you can drive your scooter on), and they can match your contributions (like mom & dad giving you gas money).  If you want to get that money (selling your car), you need to work with the "Fund Administrator", and sometimes your "Human Resources/Supervisors" to get that money.  Sometimes, you'll only get the money if you promise to pay it back.  ( yep, mom & dad want you to be responsable )\n\n2.  IRA is like a standard car. You can select who administrates the account (or where you park your car), what investment to buy (what roads to drive on).  Unfortunantly, there is no one available to give you a match on your contribution (no gas money from mom & dad); but you can deduct your contribution from your taxes.  You can also withdrawl the money at anytime (selling your car). . . BEWARE. . . there are financial concequences to this. . .research before you choose to withdrawl (its like sales tax from selling your car. . .if you sell at the wrong time, you'll get jipped on the sale proceeds).\n\n3.  A Roth IRA is like a hybrid car.  You get to pick who administers the account (parking the car) which investments (which roads to drive), but there is no matching and you can't deduct your yearly contributions from you taxes.  Instead, you can get your money without tax conseques (selling your car) when you need it. . .BEWARE. . . to get your money without tax problems, there are still rules.  Research before you withdrawl funds (sell that car). Providing you withdrawl (sell that car) under the guidlines, you don't have to pay sales tax on the withdrawl ( no sales tax from selling the car).
209580
IRAs generally have some advantages over a 401K.\n\nThe biggest one is that you aren't as limited in your investment choices.  The typical 401k may have 9-10 funds to select from.  IRAs are pretty much unlimited.\n\nHowever, without knowing what costs your company covers for you in the 401K, this is a pretty difficult question to answer.
1028430
I invested. I make about $5,000 a month. I used over $1 million. My percieved risk was fairly low because of the way that I invested. I do not take time to manage it. That's what I hired my financial advisor and broker for.
375
Just go to vanguard.com or any of the brokerage firms (Vanguard usually has the lowest fees), sign up for a rollover IRA account, and follow the directions they give you. It usually involves filling out a form and submitting that to whatever company is managing your old 401(k).
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If your only contribution to the traditional IRA is the rollover, then you may still be able to contribute up to $4000 ($4,500 if you are over age 50) to either the same traditional IRA or to a Roth IRA, depending on which one best fits you. \nThere are other factors involved here, such as whether or not you still contribute to your employer's retirement plan and how much you make. I'd be happy to do the calculations for you if you'll give me those numbers. But I understand that is sensitive information, so I will send you the link to the form you use to figure allowable contributions. \nRollovers are not considered contributions because they are in the same type of tax-advantaged plan. You would only have to be concerned if you put more into the IRA than you had in the 401K, or, conversely, if you spent some of the money and didn't out it all in (you might be liable for tax and penalties in that case). \nLet me know if I can be of further assistance :)
1176821
I think...your question...is kinda confusing.  There is the Tradional IRA, Roth IRA and 401(k).  I am not sure there is anything such as Tradional 401(K).\n\nif you're talking about 401(k) - you can move your 401(k) from previous employer to your current employer's 401(k) , OR if you want more options, besides 10 or so mutual funds your current employer offers ( or similar number of funds offered by your previous employer ), you will be better off, rolling your 401(k), into a ROLLOVER IRA. Of course, everytime you trade you're going to pay commissions, which may not be the case in 401(K)\n\nif you're talking about Traditional IRA to ROTH IRA : if you meet certain IRS criteria ( such as be Single, or file jointly if you're married and above all have a Adjusted Gross Income of less than 100K. )  If you think you're going to be in the same Tax Bracket as you are today or above that, when you're 50s ( i think 57 or something like that ),  you will be better off, paying taxes on your earnings in your traditional IRA, TODAY,  at your current lower federal income tax  bracket, so you don't have to pay ANYTHING in your ROTH IRA - even if grows to be Billions of $$$$.  As usual, there are the inherent benefits of ROTH IRA - you will not be required to withdraw monies from it ( with Traditional IRA you will be forced to take out money in 50s and pay taxes on it - if you don't you pay penalty ). You can pass on the ROTH IRA to your kids, etc.\n\nAs usual, consult a financial advisor, as each case varies.  \n\nOne more thing....If your considering converting traditional IRA to ROTH, be prepared to shell out taxes on your earnings/income - from out of your own pocket - DON'T CONSIDER PAYING IT OFF WITH YOUR EARNINGS/INCOMES FROM TRADITIONAL IRA - YOU WILL PAY EARLY WITHDRAWL PENALTY AT 10%
45804
You can invest up to 14K (and more) through a solo 401K.TD Waterhouse/ameritrade offers the account with low fees. So do some other financial institutions. There may be other instruments such as SEP etc.. \nwatch for fees, maximum annual investment. \nSpeak to someone at your bank/broker.
725978
You can cash it in with a substantial penalty.\nYou can let it sit there and hopefully grow.\nYou can roll it over into a IRA\nYou can roll it over into another 401K\nThe part of it that YOU contributed through you\npay is always yours, The part that your employer matched (if they did) is "vested' over a period of time, so if you were there less than a year\nthe part THEY contributed they probably take back.\nif you were there 5 years, it's probably all yours also.