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Oct 30th

Learn your three Ps of your companys 401(k)

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Learn your three Ps of your company's 401(k)

Start planning for retirement the day you are hired. Using the "pay yourself first" techniques, try to immediately allocate no less than six percent of your gross salary to a liquid savings account. Open your account in an online money market account so that it is inaccessible to you. You shouldn't set up a debit card or checking on this account.
Start planning for retirement the day you are hired. Using the "pay yourself first" techniques, try to immediately allocate no less than six percent of your gross salary to a liquid savings account. Open your account in an online money market account so that it is inaccessible to you. You shouldn't set up a debit card or checking on this account.

Get a copy of your company's 401(k) plan rules. Analyze the plan as you approach eligibility. Learn your three Ps:

• Plan
• Product
• Program Administrator's website

Understand the plan's rules and limitations. Know if you can purchase company stock. Know if you have a brokerage option. Older employees, review the plan again. Determine if any changes have occurred since the 2006 Pension Act.

Review the Products offered in your plan. Using www.marketwatch.com or other websites of your choice, review the objective, expense ratio and determine if the products offered in your 401(k) plan pays dividends and capital gains.

Review your Program administrator's website. Read the articles written. Learn how to determine your transaction history. Know how many shares were purchased and how much was paid for each share. Become familiar with everything offered on this website.
Why do you need to start early? Research has proven that thirty percent of workers retire earlier than expected "because they have to due to illness, disability, layoffs or some other reason beyond their control." That's right, even though you plan to work until you're sixty-five, something may happen to prevent this. Yes, you can get rich and then you'll be in a much better position to deal with life's adversities.

The book provides the basic sound advice of "pay yourself first." Visit website: www.jab401k.com today.

 

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