Common 401(k) Mistakes To Avoid

Christian personanl finance blog Redeeming Riches offers four revelations on how you may be mistreating your 401(k).

The post offers standard but rock-solid advice on mistakes to avoid, such as failing to diversify investments and haphazardly choosing funds. It ends with what may be the most important piece of 401(k) advice of all — increasing your contribution to max out your employer’s match:

A big mistake often made is not knowing what kind of match the company is offering resulting in leaving free money on the table.

If a company is matching dollar for dollar up to – say five percent, it’s silly to only put in three. You’re leaving an additional two percent out there that could be matched.

At the very least you should be putting enough into your 401k to take full advantage of any money they are going to give you.

This assumes some employer out there still offers a 401(k) match. Many dropped the perk due to the recession, and it will be interesting to see how many reinstitute the match when things perk up.

Previously: The Basics Of Insurance, Taxes, And 401(k)s For First-Time Employees

Redeeming Riches [Do You Make These 4 Common 401k Mistakes?]
(Photo: krodinjw)