What's In Your 401k?

[Zomby Woof]

How many of you have (or have had) a 401k?

By and large, they are usually made up of mutual funds, which (pardon my Investing 101 lecture) are an aggregation of stocks (and/or bonds) derived from many different companies. Some are comprised of stocks from a specific type of industry (like tech stocks) and others can be comprised of what level of risk they involve (high-yield bonds). There are other types, but you get the idea.

So if you have a 401k (or you invest in mutual funds on your own), I bet you have NO IDEA which specific companies are in your portfolio at any given time. Mutual funds can have lots of turnover within them within short bursts of time - perhaps a tech-sector fund can trade its Apple stock for some shares of IBM, etc. The point is, you could find out, but think about how much time and effort this takes from dayto day. That's where fund managers earn their keep.

It's likely John Edwards didn't keep on top of his hedge funds for the same reason - it's time-consuming and involves lots of micromanagement. And if that doesn't answer your "isn't he supposed to know these things?" question, then he knows now, doesn't he? He is doing the right thing by getting out now.

Let those who have the purest of portfolios cast the first stone.

Edwards is no hypocrite. I posted a thread some weeks back explaining that anyone who dares speak out about poverty and the class taboo in this country will be savaged. It's still the most verboten topic in mainstream political discourse. At best, it's dismissed as "firebrand populism", and at worst, "class warfare". Either way, the person is marginalized with due haste.

I support John Edwards for president. I do think his chances for securing the nomination are less likely now than at any time during the campaign. But the reason is because of how this will be spun and dissected in the media these coming weeks. Not because of poor judgment, hypocrisy, or phoniness on his part. He isn't perfect by a long shot, but neither is he the empty haircut of which his detractors claim.

[AtomicKitten]

1. rainbows and baskets of kittens

and 401Ks in my dreams

[DS1]

2. SUNW

+32% in a year :)

[scarletwoman]

3. Nothing, since I don't have one. (nt)

[Zomby Woof]

5. That doesn't change my point

Whether you have one or not, I illustrated why it was easy for him NOT to know, no matter his level of intellect or personal wealth.

[scarletwoman]

8. I was just answering the question posed in your subject line. I have no quibble with your point. nt

[AtomicKitten]

9. people believe what they want to believe

I'm never entirely comfortable with the scrutiny of the candidates particularly on the internets with so much free-form sh*t flying around.

I do admire Edwards' bold strategy, going balls out in Iowa and rolling the dice. It could be brilliant or it could end him.

The race is getting kind of interesting.

[Mythsaje]

4. I support firebrand populism AND class warfare...

After all, they fired first.

[Mojambo]

6. You said it.

I am so ready for this class cold war to go hot.

[nadinbrzezinski]

11. Trust me you are not

and when it does, and it is a matter of time, you will know why I wrote this

[davidwparker]

7. Right. I have NO idea what comprises mine. If I did, I would have taken

my money out the USA like Cheney did and have 30% yield betting against the US dollar (like Cheney did).

Have I told you lately how much I hate these people? :)

[karlrschneider]

10. I have zero investments except real estate. Not saying it's smarter, better or

superior in any way...but I do know one thing: they ain't making any more of it. I won't even bitch if the value stays flat, I still got it. ;-)

edit: It's almost all unimproved land...and includes mineral rights.

[nadinbrzezinski]

12. Thansk for pointing some facts

I know what is in one account, but the retirement funds, they change day to day as the managers do what they are paid to do

[madrchsod]

13. nothing but air

i had to cash out two plans because we were broke

[Rosemary2205]

14. IMHO you are making the WRONG point.

Those wealthy enough to have 401Ks are probably often in the same boat as Edwards. An fund manager is going to move things around without consulting an individual invester.

But IM very HO the REAL question is why can so few Americans afford to save for their retirement in the first place and what can be done to change that reality.

[Zomby Woof]

18. I agree with your last point wholeheartedly

As for the former, running for president is an exhausting, full-time job, and I think he was sincerely alarmed at what his investments got tangled up with. It was probably because he had some time to review his investments that he found out. Better he come right out and admit he was wrong than try to cover it up. There is no way I could support him in that case.

[sandnsea]

15. Who knew about the foreclosures?

Was this something known? I don't even like the Edwards and I don't think he intentionally did this.

However, it goes right back to his house. When you're rich and can do anything you want with your money, and you say you want to change the world - well then change it. He didn't do ever thing possible to create a sustainable home, and he obviously didn't do everything possible to invest in socially responsible firms. He could have. He just didn't. A lot of wealthy liberals don't and I think it's wrong.

[Sherman A1]

16. Good Post

To answer the question... It's a whole lot less than it was about 2 weeks ago. I'm down about 12K as of yesterday for the year. Oh, well......

[jwirr]

17. This was a lesson that should have been learned back in the 60s/70s

when many a good person found themselves owners of slum property or part of some child labor business in a third world country. I do not have investments but if I did I would want to know what their moral impact was.

[Rabrrrrrr]

19. To expect anyone to keep track of what is in a managed fund is ridiculous and assholish.

Thankfully, I'd not heard of anything about Edwards investments, but sounds like someone on the right probably got hold of some info and decided to nail him because his hedge fund, which is probably in a thousand different things, changing daily, managed to hit something bad on the day the rightwing piece of shit decided to take a look.

One of my 401(k)s I know precisely what's in it, except that they are mutual funds - I have no idea, at any given moment, what those mutual funds are investing in (except the one that tracks the S&P 500, which I know can only have S&P 500 stocks in it).

Another 401(k) is managed by the company, and all I do is tell them what precent to put into what types of investment (e.g., "leveraged bond funds", "real estate", "special opportunities", "Asian bonds", and so forth). I have absolutely no idea what any particular investment is. For all I know, I own a lot of shares in a company that owns slaves and makes land mines to use against children in other countries.

My last 401(k) I only get four options: bonds is one option; the other three are high-risk, medium-risk, and low-risk.

Even my non-401(k) investments have a heavy percentage in a number of mutual funds, which I also don't know what's in them, except another S&P 500 tracker.

I really wish that part of our national education system was a required class in economics. We live in a country that's 99% money illiterate, and it makes life hell.

[Zomby Woof]

21. To be sure, there is no such thing as "pure" money

Even someone with a modest savings account at their local bank which pays 0.75% isn't pure. Banks don't give that interest away as a gift. It's a return on an investment - a hodgepodge of government bonds, or mortgages, and who knows what else.

Can we make choices? Sure. I won't knowingly invest in an unethical or corrupt company, but to constantly be aware of where my returns are coming from at all times - well, I am not keeping my money in a mattress, and I sure as hell don't want to work until I am 85.

[Rabrrrrrr]

22. That's right about bank accounts, too - that 0.75% might be coming from a porn shop loan,

a loan to a gun store, or other place that is taboo for decent fundamentalist democrats.

[alarimer]

20. nothing

Can't afford it on my salary. The increase in energy costs ($130 a month electric bill- during the summer-on a one-bedroom apartment) mainly is what is killing me.

I have no idea how they work or whether I would even know what it was invested in.

[Dorian Gray]

23. I have a 403 (b)

a Non-Profit alternative. I have a slew of mutual funds, and though I don't know every investment, I can easily find out with a little research.