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Bad Timing

When I started contributing to my employer’s retirement plan there were a few fund companies with quite a few funds to pick from. At the time there was an excellent book out by Peter Lynch called “Beating The Street”.

Peter Lynch managed the Fidelity Magellan mutual fund until 1990 and returned huge gains. His successors did pretty good for a few years and then it was time to dump Fidelity Magellan sometime in the ’90s. But there were a ton of folks who kept it for a long time just because of the name. Hoping it would have that ounce of magic left to make a big return.

Bad TimingI know folks are still in it and maybe don’t even know what return they’re making from it nor do they possibly care.  It’s as if some people use their employer’s retirement plan as a forced savings account and don’t know what kind of return they are getting or what kind of return they should be getting.

So, if you’re in Fidelity Magellan you should get out.  With all the funds to pick from and hopefully you have more choices to pick from your employer’s retirement plan, try and get on the right track with at least a fund that tracks the S&P 500.

One way to compare your fund to others and its performance is to do some research at www.fundalarm.com.  You can also post your funds here or the choices you might have and we can give an opinion as well.

Or you can try the paid service at www.smart401k.com to get some professionals to help you with your choices.

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