I prospect for new 401(k) advice clients just about every day. I can’t help it. Over 36 years of my prospecting habit is hard to break.
Last week I received a copy of an individual company 401(k) retirement plan account statement from the lady that checks my receipt when I leave Costco each week. In case you need to know, Costco offers their employees a very good 401(k) plan.
Individual investors often resist my initial approach to them regarding independent, third-party investment advice for their company 401(k) retirement plan accounts. Their excuses fall into two main categories.
“I don’t have time for this now”
At face value, this is the most reasonable response. Lawyers bill by the hour. Physicians bill by the procedure. There is always “the next Zoom meeting” for a corporate executive. Time is money for any highly-compensated, time-constrained individual investor.
I provide a two-page analysis of the annual costs and investment performance of existing company 401(k) retirement plan mutual fund main menu options. In less than ten minutes, an individual investor can understand the age-old “what to buy” question when facing a company 401(k) retirement plan mutual fund menu.
In the last few months, I have scheduled many morning coffee video calls. I rank each default company 401(k) mutual fund menu. Then I find out how many of these great mutual funds the prospect currently owns.
These early morning coffee calls work well in most individual’s workday morning routine. Every prospect I have talked to has responded that they have never known so much about their company 401(k) menu after our brief conversation.
Don’t let the “I don’t have time for this” lie hold back the growth of your 401(k) account. If you have time to pick your fantasy football team each week, you have ten minutes for a thorough review of where and why your retirement money is invested.
Every individual company 401(k) retirement plan participant own at least one mutual fund option they shouldn’t own. That mutual fund is costing them valuable stock market gains recently.
Once I get a prospect’s attention with their high-priced and underperforming 401(k) mutual funds, I invariably deal with the next big company 401(k) investment advice objection.
“Why do I need to pay someone to manage my 401(k)”
The specialization in the business world today cannot be ignored. High level proficiency does not transfer between professionals these days. No one can be expected to be an expert in all areas of their business and personal life.
A good lawyer, a capable tax advisor, and an insurance professional should all be important members of your “money team.” An experienced investment advisor should also be able to analyze your company 401(k) account.
Most individual company 401(k) retirement plan participants are not especially gifted or comfortable with navigating their retirement plan mutual fund menus. Don’t continue to feel guilty about your inattention to your company 401(k) retirement plan account. There is no need to take time away from your family or career to figure out your 401(k) investment management problem.
Today’s generation of professional investment management technology provides for a third-party, independent, fiduciary-level investment performance ranking and cost analysis of your company 401(k) retirement plan mutual funds.
At the current stage of the U.S. stock and bond market cycles, an even more important investment management question is “when to sell.” Do you have current access to the best stock market and mutual fund guidelines that provide for the principal preservation of your company 401(k) retirement plan assets?
Your company 401(k) retirement plan account is likely one of the biggest pieces of your investment assets. There is no reason on earth to continue to ride the stock market roller coaster up, and back down, every few years.
Ric Lager
Lager & Company, Inc.
