What Kind of 401k Investment Opportunities Exist?
401k Retirement Plan Investing
Different types of investments will yield different results, whether you desire a quick return, or long, sustained growth. Generally, the best way to get positive results is to diversify your portfolio with a number of different investments. Read about the basics of some of the different investments you can put money into from a 401k plan.
Aggressive Growth Funds
If you are looking to quickly and greatly increase the amount of money you are investing, an Aggressive Growth Fund might be the best option for you. Keep in mind that while investing in companies such as start-up companies, high-risk industry companies and smaller companies can yield massive results quickly, the risk involved might not be worth it.
These blendings of both stocks and bonds are also known as Lifestyle Funds or Asset Allocation Funds. This means of diversification allows for a much lower potential risk.
Like savings bonds, Bonds funds are simply loaning money to your federal or local government or a corporation. You are repayed after a certain amount of time has passed, with interest from a set interest rate. This can be one of the most reliable and low-risk forms of investment, since the government is unlikely to to go bankrupt. Make sure that when you purchase bonds from a corporation that it is a very steady and consistent business.
Growth and Income Funds
Growth and Income Funds are simply investments in companies that show a potential to grow in the future and have also been strong in the past with a track record of consistently paying dividends.
International or Global Equity Funds
Potentially more difficult to establish a probability of success or failure are International/Global Equity Funds. These are investments in stocks from companies outside of the United States.
Money Market Funds
Money Market Funds can refer to any number of commercial investments, including U.S. Treasury Bills, CD's (Certificates of Deposit), and other similar investments.
Mutual Funds are the pooling of funds from a number of different investors and put money into multiple investments, such as bonds, stocks, and money market funds. Like a limited liability partnership, Mutual Funds seek to drastically reduce the inherent risk of investments of this type.
Stable Value Funds
Stable Value Funds look for the most stable and predictable growth for a long period of time. They are also commonly referred to as "Fixed Funds" or "Guaranteed Funds." They can be contractually guaranteed by insurance companies are widely thought of as low risk.
How can I find out more?
- You can start by visiting our online Learning Center to review the basics of how a 401k rollover works and what it can do for you.
- Use our Contact an Agent form to request a rollover for your 401k plan.
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