3 Guidelines When Buying A 401K

21 June 2017
 Categories: Finance & Money, Blog

Any time that you want to be sure that you are handling your investment potential to the best of your ability, take the time to get the help of investment companies that can secure your retirement. There are a variety of 401k companies that can serve you with this, whether you get the plan through your employer or if you find a third party provider on your own. To this end, read below and learn a little bit more about getting a 401k plan that can help you out. 

The Advantages of Getting a 401k

To be sure that you are able to safeguard your money over the course of several decades, a 401(k) is a great plan to consider. You will be glad that you purchased one of these plans because they are tax-deferred and you do not need to worry about getting hit with fees as your money grows. You will also be able to receive approximately $1500 in tax credits, so that you are able to lower your liability even more. These retirement plans are also great for you, because they can be useful if you are going to take the money out to buy a home or make other substantial purchases.

Understanding Employer Contributions

It is very critical that you learn exactly what your employer will do if you buy a 401(k) plan for the company. Most employer plans come with additional benefits -- to include companies that match your contributions. According to statistics, some 38% of employer issued 401(k) plans have some sort of match policy. You will typically be able to learn the in's and out's of these terms during the open enrollment period. Make sure that you speak to your human resources department to learn as much as you can about these points.

Factor in the Investment Company's Portfolio

Finally, make sure that you research the company that handles the actual 401(k) investments. This way, you will learn about the portfolio managers, the types of stocks, bonds and commodities they specialize in and any other relevant information regarding their credentials. You also need to research the plan to learn who the 401(k) third-party administrator (401k tpa) is, their background, any terms and conditions that are relevant.

Take advantage of the guidelines in this article if you are in the market for a 401(k) plan. Considering this information will be helpful to you if you are looking to build toward your retirement. You can also work with a company like Uniglobal Pension Planning LLC for more help.