Cover image for Take control with your 401(k) : an employee's guide to maximizing your investments
Take control with your 401(k) : an employee's guide to maximizing your investments
Wray, David L.
Personal Author:
Publication Information:
Chicago : Dearborn Trade Pub., [2002]

Physical Description:
xii, 210 pages : illustrations ; 23 cm
General Note:
Includes index.
Format :


Call Number
Material Type
Home Location
Item Holds
HD7105.45.U6 W73 2002 Adult Non-Fiction Non-Fiction Area

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This guide for employees describes the benefits of 401(k) retirement plans. Written in plain language, the text addresses such topics as employee stock ownership plans, the importance of diversification, developing a financial plan, IRA rollovers, borrowing for emergencies, and the division of funds

Author Notes

David L. Wray is a leading authority on 401(k)s and retirement programs, and currently serves as president of the Profit Sharing/401(k) Council of America (PSCA), the organization instrumental in getting 401(k) legislation onto the books in 1978. Wray is a nationally recognized authority on defined-contribution plan issues and is a highly visible advocate in the financial media, often commenting on the state of savings for retirement in the United States. Wray was recently appointed by the U.S. Department of Labor to the Advisory Council on Employee Welfare and Pension Plans, also known as the ERISA Advisory Council. This panel considers issues important to the security of workers' benefits, while supporting employers' efforts to provide benefits that are useful as well as cost effective.

Table of Contents

Prefacep. vii
Acknowledgmentsp. xi
1. 401(k)--What's It All About?p. 1
Eight Reasons Why 401(k) Is Right for Youp. 1
It's a Win-Win Worldp. 2
The Employer-Employee Partnershipp. 3
Your 401(k) Checklistp. 4
2. The 401(k) Advantagep. 7
Less Tax Pain, More Gainp. 7
Saving Is Easyp. 14
You're in Controlp. 17
It's Protectedp. 19
3. Your Employer's Rolep. 21
Plan Designp. 22
Other Employer Supportp. 31
4. Make the Most of Your Company's Planp. 37
Participationp. 37
Start Saving Nowp. 38
Get That Company Matchp. 38
Start Earlyp. 39
Maximize Your Contributionp. 40
Vestingp. 42
Automatic Enrollmentp. 42
Employer-Provided Informationp. 43
Using Technologyp. 45
Profit Sharingp. 47
Coordinate with Your Spousep. 47
5. When You Need Your Money Nowp. 51
Loansp. 51
Hardship Withdrawalsp. 55
Early Distributionp. 56
6. 401(k) Investing--The Basicsp. 61
Three Main Types of Investmentsp. 61
Plan-Provided Investmentsp. 64
7. Stable Value Fundsp. 69
Stable Value Investmentsp. 69
Transfers and Withdrawalsp. 71
Who Invests in Stable Value?p. 71
How Secure Are Stable Value Funds?p. 72
8. 401(k) and Employee Ownershipp. 73
Employee Stock Ownership Plans (ESOPs)p. 74
Company Stock in a 401(k)p. 75
Diversificationp. 78
9. 401(k) Investing--Easier Than You Thinkp. 81
The Power of Compoundingp. 82
The Benefits of Investing in Stockp. 84
Principles for Managing Your 401(k)p. 85
10. 401(k) Investment Conceptsp. 91
Asset Allocationp. 91
Investment Returnp. 92
Riskp. 92
Diversificationp. 94
Rebalancingp. 96
Feesp. 99
11. Your Financial Planp. 101
Defining Your Goalp. 101
Developing Your Planp. 106
Implementing Your Planp. 109
Monitoring Your Progressp. 110
12. When You Change Jobsp. 111
Your New Employer's Planp. 112
Your Previous Employer's Planp. 113
Individual Retirement Account (IRA)p. 114
Taking a Distributionp. 115
Special Considerationsp. 116
13. You're 25--Start Saving Nowp. 119
The Benefits of Saving Earlyp. 119
The Power of Compoundingp. 121
14. You're 50--Prepare for Retirementp. 123
Transition Investingp. 124
Make a New Planp. 125
Catch-Up Contributionsp. 126
Planning Your Estatep. 127
It's Never Too Latep. 128
15. 401(k) at Retirementp. 131
Keeping Your Money in Your 401(k) Planp. 131
Lump Sum Distributionsp. 132
IRA Rolloversp. 133
Annuitiesp. 134
A Combination of Optionsp. 135
Minimum Distributions at 70 1/2p. 135
Professional Assistancep. 136
16. Picking a Financial Advisorp. 137
Are They Qualified?p. 139
How Much Will They Cost?p. 139
Are They Right for You?p. 140
Who Else Benefits?p. 140
Get It In Writingp. 141
For More Informationp. 141
17. Other Plans--Differences and Similaritiesp. 143
Savings Plans Similar to a 401(k)p. 143
Other Employer-Provided Retirement Plansp. 149
18. 401(k) and Military Leavep. 153
Eligibility under USERRAp. 153
Ineligibility under USERRAp. 155
401(k) Rights under USERRAp. 156
19. 401(k) and Divorcep. 159
Ensuring the Validity of a QDROp. 159
The Division of Funds in a Divorcep. 161
What to Do with QDRO Assetsp. 162
20. 401(k) and Your Rightsp. 163
Plan Documentsp. 164
Filing a Claimp. 165
Going to the Governmentp. 166
21. Avoiding 401(k) Mistakesp. 167
Not Participatingp. 167
Not Maximizing the Matchp. 168
Investing Outside Your 401(k) Firstp. 168
Not Investing for the Long Termp. 168
Overtradingp. 169
Not Rebalancingp. 169
Misunderstanding Bond Fundsp. 170
Borrowing for Nonemergenciesp. 170
Cashing Out before Retirementp. 171
Conclusion: 401(k)--The Plan That Paysp. 173
A. Frequently Asked Questionsp. 175
B. 401(k)--A Brief Historyp. 182
C. Contribution Limits through 2010p. 183
D. The Economic Growth and Tax Relief Reconciliation Act of 2001 Provisions Affecting Your 401(k) Planp. 184
E. Glossary of Termsp. 193
Indexp. 205