We suggest this balanced strategy for managing your simple 401k or 403b allocations in an employer's plan.Our 401k advice is do NOT ignore your 401k options! Even though you are invested in your employer's 401k retirement plan you should manage your own account. Most 401k plans today allow you some control. Use this freedom to maximize your retirement returns. Read our blog, Active versus Passive Retirement Investors , for more detail. In general here are the easy steps you should take: - Learn what investment vehicles (usually mutual funds) are available and how to buy and sell them. Look specifically for ETFs in your employer's plan, otherwise use mutual funds.
- Allocate your resources based upon how many years until you plan to retire. Use our asset allocation tool for your simple 401k or 403b allocations.
- Select a balanced strategy of Index ETFs or mutual funds for your 401k portfolio . (ETFs are usually more profitable than mutual funds because of the ETF's lower expenses.)
- Buy shares when the TimingTruth signal is a BUY; sell and move to a Cash position when it is a SELL signal.
- Be patient. Your simple 401k retirement plan is a long term strategy by design.
This balanced strategy for simple 401k retirement plans is constructed to avoid the catastrophic losses many experienced in 2008 -9. Below are the model 401k portfolios suggestions identifying the specific funds along with their related timing signals: The Underlying Indices in this Strategy Underlying Index
| Asset Class
| S&P 500 Index
| US Stock
| | MSCI EAFE Index | Foreign Stock
| | Barclays Capital U.S. Aggregate Bond Index | Bonds
| | Barclays Capital U.S.Treasury Inflation Protected Securities (TIPS) Index | Inflation Proof Bonds
| Any Money Market Fund if available, if not available use Short Term Treasury mutual fund
| Cash |
Analyze this Strategy's Performance using our Portfolio Performance Analyzer |
