Studies Show the Less You Do With Your 401(k), the More You Earn

ometimes, it helps to hear this from an independent source…

Don’t take this too personally, but the less you are involved with investment decisions for your 401(k) the better off you may be.

Sometimes, it helps to hear this type of thing from an independent source. As we have said before, we don’t fix our own cars, why should we be expected to be professional investment managers?

Don’t take this too personally, but the less you are involved with investment decisions for your 401(k) the better off you may be.

A new study of more than 400,000 401(k) participants in seven corporate plans found that the median return earned by individuals who sought out help in managing their 401(k) was 1.86 percentage points more than participants who made their own allocation/investment decisions.

Read More

Investing Is Not Entertainment

As you know, we are big fans of the BehaviorGap. Our friend Carl Richards is now being featured in the New York Times website. His latest post there is two minutes of really good advice.
Am I investing to meet my most important financial goals or am I investing as a form of entertainment? For almost all of us, it can’t be both.

Read More

Video: Quick and Easy 401(k) Moves

We are a fan of keeping things simple, so when we run across tips on how to do so, we like to make sure we share them with you. The following video is an example of such tips; this one specific to your 401(k) plan.

There is one thing we would like to add to the idea of consolidating your old 401(k)s: If your company has BeManaged available, many of our clients prefer to roll those old 401(k) accounts into their current account to make sure it is managed for them, instead of having to figure out where and what to invest in themselves. Often times they are nearing or already past the capped fee we charge, so there is little to no financial benefit to us, but a big one for our clients.

Read More

Another Study Shows 401(k) Advice/Help Improves Participant Outcomes

A recent study by Hewitt and Financial Engines found that people getting “help” outperformed those that did not by about 2%, after analyzing the performance of roughly 400,000 investors across seven retirement plans. The findings compliment the study by Charles Schwab in Nov. ’07, which found those that got help outperformed those that did not by nearly 3%. The studies compliment each other by the fact that each were conducted during different market cycles, the Schwab study during a bull market, the Hewitt study during a bear market. Thus, regardless of the market’s direction, studies show proper portfolio management superceded normal investment behavior (chasing performance, emotion based investing, etc.).

Read More

Why Is Your 401(k) In Trouble? Because You Don’t Have Time To Read This Post

Our lives are as busy as ever. Family, school activities, committees, church, associations…oh, and that job thing too. These are the days of never really “disconnecting” with laptops, netbooks and smart phones constantly keeping us informed and “connected.”

Additionally, the multitude of responsibilities we are responsible for continues to increase. Your 401(k)? Yeah, that’s one of them. Lack of time is the #1 response people give us when they sign up for our BeManaged or BeAdvised service.

Read More

Amway Demonstrates Employee Focus via 401(k) Advice and Financial Counseling

Late last year, Amway concluded a three year nationwide due diligence campaign for fiduciary 401(k) advice and hired BeManaged, powered by local firm Actium LLC, which provide professional ongoing account management and investment advice through Amway’s existing 401(k) plan, administered by Fidelity Investments. Over 1,000 Amway employees took advantage of BeManaged’s free 1on1 consultations provided over a 90 day period, which helped them understand what kind of investor they were, and then comparing that with how they were actually invested, and then allowed them to decide if they wanted to utilize BeManaged’s management or advice services.

Read More

5 Dumb Investing Mistakes to Avoid

We don’t call anyone dumb, because when it comes to investing, really “smart” people make as many or more mistakes as investing novices. The underlying issue? Our behavior and choices, which are often misguided by emotions. Investment behavior’s impact on investors’ returns have been well documented over the past few years. This is evidenced by the book referenced in article below, Why Smart People Make Big Money Mistakes, as well as by our friends at BehaviorGap.com.

Read More

401(k) Investors: Keep Retirement Planning Simple

The video below is a very concise, simple advice on planning for your retirement by focusing on the KISS principle: Keep It Simple Stupid (I have to remind myself of this all of the time).

Here are some key points covered to focus on:

Save – You are responsible for your own future, do not expect the market’s returns to bail you out.
Understand Yourself – Risk is critical, so if you don’t understand it (most don’t), get some help.
Don’t Chase Returns – It’s a “loser’s game” based on the emotional response we have with this strategy.

Read More