Mutual Funds

Since the late 1970s, many companies changed retirement plans from traditional pensions to 401(k)s and other plans that don’t guarantee a fixed payout. But many believe that 401(k)s actually fail to help Americans effectively save for retirement.

Saving money in 401(k)s comes with a few strings attached – fees. The fees in retirement accounts are probably the biggest obstacles to saving successfully for retirement, and many of these fees are undetectable to the untrained eye.

The good news is that new regulations mandate that the fees be better disclosed. Pay attention to the information. If you are an employer, the rules impose new requirements on you.

Let’s look at how fees nibble away at your returns and how the new disclosures can help:

Target date funds are mutual funds that automatically reset their asset allocation as you age. Typically, the mix shifts from stocks to presumably safer bonds. These funds might be a great investment for you, but they have little-appreciated risks of their own.

The cost of housing, healthcare and other basic necessities rise faster than wages. How can you keep up with price increases and still save for retirement? Plan ahead for rising costs early on and take some risk to combat rising costs.

Springtime ushers in a rush of annual shareholder meetings, but these days, few investors are making this corporate pilgrimage. That’s a mistake. Attending at least one meeting for a stock you own is a very good idea.

Every publicly traded company holds an annual shareholder meeting, and most companies fulfill this requirement with as little time or meaningful content as possible. But failing to participate can be costly when investors and executive managers fail to look each other in the eye.

It’s easy to overpay or underpay taxes on your bond income and not even know it. Bond taxation is complex and there are several considerations that require different tax treatments. You need to be careful to avoid surrendering too much to the tax man, especially if you invest in zero-coupon or state bonds.

If you purchased a bond at par, also known as face value – 100 cents on the dollar – and held it to maturity, it is fairly simple. If it’s a taxable bond, you pay income tax on the coupon (interest) income. If it’s a tax-free municipal bond, you don’t.

Spring is traditionally the time to clean the garage and to get the yard in shape. It’s also a great time to clean up your investment portfolio. Fresh off tax season, this is a perfect opportunity to get rid of clutter, review your asset allocations and make the necessary changes if your portfolio has strayed from your financial plan.

Here are seven steps to making your portfolio cleaner and more efficient.

To preserve harmony in a relationship, sometimes it’s easier to just go with the flow. When it comes to money and investing, however, going with the flow can lead to troubled waters. Men traditionally dominate a couple’s finances, but women are often better at investing.  So women, recognize that there is a good chance your instincts are more consistent with financial best practices, and take a stand for both of your financial futures.

Despite the wealth of information and good advice about saving for retirement, too many folks miss their financial goals due to avoidable errors.

Here are five bad habits that all but guarantee a lousy retirement. Do you fall into these traps? If you do, you can avoid them by making a clear financial plan and sticking to it.

Since the financial crisis, many investors lost faith in mutual funds, especially actively managed ones with higher fees, and flocked to low-cost exchange-traded index funds. This isn’t a bad thing, but there is no reason to categorically exclude mutual funds from your portfolio.