401k plans are retirement plans designed to supplement pensions and social security.  They are funded through employee payroll deductions.  An employer has the ability to match all or a percentage of funds contributed.  The money is then invested for long-term success.  Most individuals opt for bonds, stocks, or a combination of the two.

If you are just creating your 401k plan or if you are now just realizing the importance of yours, a question may arise.  That question is whom do I let handle the decision-making.  Unlike Social Security and pensions, you, the employee are in control.  Your employer may limit some of your investment opportunities, but you always have choices.

The problem comes from financial experts.  For larger corporations, especially where unions are involved, there is usually financial experts and advisors on hand.  These individuals can help you make the right investment choices, but some do all the work.  The employee, which would be you, still has to sign off on the investments, but many don’t give it any thought.  This is common with those in their 20s and 30s.  They are not typically concerned about retirement yet, but do agree it is a good idea to start saving.

Relying on a financial expert was once concerned a safe play.  After all, they are experts in the field.  Right?  Yes.  Nonetheless, December 11, 2008 is a day that most financial experts will remember with distain.  It was the day that the former chairperson of the NASDAQ stock market exchange was arrested for running a huge Ponzi scheme.  To this day, the full financial impact has yet to be felt.  It is estimated that hundreds of thousands of Americans lost most, if not all of their retirement.  Many of these individuals are just like you.  They relied on a qualified financial expert, who advised banking on Madoff’s investment firm.

As of now, there is no connection between many of the financial experts and brokerage firms that directed their clients to Bernard Madoff.  Many are victims too.  It just goes to show that even the best financial experts can be wrong.  What does that mean for you?  Never trusts their advice alone.  Do your own research first.

If you want to invest in stocks, go right ahead.  If you want to pick the brain of a financial expert, ask them for stock recommendations.  Return home and use the internet.  Search the past years of movement on the stock market, search for outlook projections for each company, and so forth.  If, at any time, you find a company that appears too risky, follow your best judgment.  Opt to invest in a different stock.  Better yet, most individuals have the option to choose between stocks and bonds.  Ensure your financial security by opting for a mixture of both.  If one suffers, you still have the other to fall back on.

As previously stated, some young adults are able to have their 401k plan arranged and managed by a company financial expert or a hired third party expert.  If you were one of those individuals years go, look at your records.  You should get quarterly or yearly statements in the mail and have a phone number or a website to access this information.  It is important to look at the big picture.  Don’t just look at the money you have in your retirement account.  Look at how much you have gained or lost over the past year.

Most experts do not recommended jumping ship just yet.  The stock market has been in a downward spiral all year.  It has all but hit rock bottom.  Many claim you can’t go anywhere else but up.  With that said, get the ticker for each of your stocks.  Find the company name and research it online.  Is there a rumbling the company is heading for disaster?  Consider trading.  Just because a stock was profitable 10 years ago when your financial advisor selected it for you, it does not mean it still it.

Regardless of whether you have been contributing to and investing in your 401k for years or if you are just getting started, be prepared.  Take the advice of a financial expert, but do your own research too.  The internet, the news, and investment magazines can provide you with the insight needed to get the most from your retirement fund.