In this short flashback episode we go back to January 8, 2020 when we made some incredible predictions about the economy, a possible recession, the markets and so on. This is before we knew anything about COVID-19. Just listen to some of the comments we make and how true they are working for us today to buy into this low market.
We follow up our predictions with the best 401K moves you should consider whether we made them back in January 2020 or today – they still work! Great guidance as you progress through the Baby Steps and onto financial freedom.
The Top 6 Best 401K Moves for 2020
- Get investing in your 401K. If you don’t have a 401K or IRA open one now. Only 1 in 4 millenials are focused on retirement planning. The #1 regret of boomers is that they didn’t start early enough.
- Get all of that company match – If you don’t understand what the full company match is for your company call your HR or payroll department and ask how much do you need to deposit to get 100% of the company match. There is NEVER EVER a reason not to get the full company match.
- Get more aggressive with your investing. IF you are 10 plus years away from retirement you should be more heavily weighted in stock funds than funds with bonds. I have a problem with target date funds in that #1 they can have a lot of fees buried inside and #2 they get conservative too quickly. I suggest considering a target date fund date further out (5-10 years) than when you want to retire. We are living longer and you don’t want to run out of money. Personally, if you are younger and doing the S&P 500 index fund I would stay very heavily weighted in that fund and never ever change it even in retirement.
- Consider rebalancing your accounts – if you have multiple funds set up your account to rebalance them at 3-6 month intervals.
- If you have a Roth 401K available – choose Roth
- If you have HSA available in your workplace consider maxing that out as well. Many employers give you free money for having a HSA. Triple tax benefits and acts like a 401K at age 65.
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