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401k Personal Rate of Return?

edro

edro

Lifer
I was playing around on 401k.com (Fidelity, our 401k provider) and you can find your personal rate of retun for any time period.

In 2004, my personal rate of return was 6.9%.

Is that any good?

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[Your Personal Rate of Return is calculated with a time-weighted formula, widely used by financial analysts to calculate investment earnings. It reflects the result of your investment selections as well as any activity in the plan account(s) shown. There are other Personal Rate of Return formulas used that may yield different results. Remember that past performance is no guarantee of future results.]
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Since it's a 401k, I figure anything over 3% is acceptable. I don't know anything though... 🙂
 
Originally posted by: edro13

Since it's a 401k, I figure anything over 3% is acceptable. I don't know anything though... 🙂
Click to expand...

Why is 3% ok for your 401k? That's barely at the inflation rate - its not going to help you grow your money towards retirement...
 
Originally posted by: njmodi
Originally posted by: edro13

Since it's a 401k, I figure anything over 3% is acceptable. I don't know anything though... 🙂
Click to expand...

Why is 3% ok for your 401k? That's barely at the inflation rate - its not going to help you grow your money towards retirement...
Click to expand...

Because that's better than a savings account 🙂
 
I'm at 6.5% this year, so far. That does not include one fund, which is too volatile to accurately give a RoR.
 
9.7% for 2004

-0.7% for 2005

Specop 007,

What investments do your 401k offer to get a 45% return? Hell, even during the 90's run up, very few funds did a 45% return in one year. The only funds that I can think of might be a gold fund, a currency fund or an energy fund.
 
If you are young, id say that rate of return is low, if you are near retirement its not so bad. The younger you are, the more risky you can afford to be. It sounds like you are into mutual funds quite a bit. As a general formula take your age and subtract 100. That will give you a rough percent that you should have in medium-high risk investments. Once you are within 5 years of retirement, 85 percent should be in very safe funds.

I usually see a return of 9.3 - 13.8 on 401ks that i manage.
 
Originally posted by: Engineer
9.7% for 2004

-0.7% for 2005

Specop 007,

What investments do your 401k offer to get a 45% return? Hell, even during the 90's run up, very few funds did a 45% return in one year. The only funds that I can think of might be a gold fund, a currency fund or an energy fund.
Click to expand...

Merger.
PCS was sittin at like 3 bucks, I picked up a bunch of it, went up to around 6 or 7 i think, then merged in with Fon.

That wasnt my final return, I simply checked it once and it was 45% return to date, I was like :Q

That wasnt my final return for the year though.
 
Originally posted by: Dufman
If you are young, id say that rate of return is low, if you are near retirement its not so bad. The younger you are, the more risky you can afford to be. It sounds like you are into mutual funds quite a bit. As a general formula take your age and subtract 100. That will give you a rough percent that you should have in medium-high risk investments. Once you are within 5 years of retirement, 85 percent should be in very safe funds.

I usually see a return of 9.3 - 13.8 on 401ks that i manage.
Click to expand...

Not one of my available 401k options have seen more than 7% so far this year 🙁
 
Mine shows by month.... Nov was 1.82 Dec was 3.52 Jan was -.98 Feb was 2.44. I'm happy with the trend so far lately, it's 6.8% in 4 months.

Right now I am in 100% aggressive funds, 40% VINIX (S&P 500 Fund), 20% International Fund, 20% Growth Fund, 20% Midcap fund. The growth fund has been my worst performer so far this past quarter, with the S&P 500 Fund close behind.

I really like my works 401k, 100% to 3% 50% to 5%... so basically 80% at 5%. But also it is instant vesting, which is nice if I switch jobs.
 
Originally posted by: iamwiz82
Originally posted by: Dufman
If you are young, id say that rate of return is low, if you are near retirement its not so bad. The younger you are, the more risky you can afford to be. It sounds like you are into mutual funds quite a bit. As a general formula take your age and subtract 100. That will give you a rough percent that you should have in medium-high risk investments. Once you are within 5 years of retirement, 85 percent should be in very safe funds.

I usually see a return of 9.3 - 13.8 on 401ks that i manage.
Click to expand...

Not one of my available 401k options have seen more than 7% so far this year 🙁
Click to expand...

Keep in mind that the age average of clients i work with is sub 30. We take a lot of chances, and get burned a lot, but at the end of the year they are pretty happy. I move funds around every quarter for my people.

Keep in mind that finincial planning is my life, so i kinda know what to look for.
 
I have been playing with the idea of letting my 401k plan decide my investments, I'm not a big stock or investment person, and overall don't have a good idea of how to invest. They charge .8% a year plus plan expenses of up to .2% so total about 1%, I think maybe they might beable to get atleast 1% higher return then me? But I really don't know.
 
Originally posted by: edro13
I'm 22, and 75% are in Med/High Risk Stocks.
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You are right where you need to be then. Research the companies you are investing in, spend an entire weekend every quarter researching and planning your investments. Over time you will learn what works best for you.
 
I'm confused about this numbers, so these percentages mean some of your investments went up 26% in one quarter!?

Or is that your historical internal rate of return?
 
last year, overall was 37.05%

here's the breakdown of each return:
Principal Large Cap Stock Index Separate Account 24.74%
Principal Partners Mid-Cap Value I Separate Account 40.78%
Principal U.S. Property Separate Account 17.42%
American Funds Growth Fund of America R3 Fund 26.29%
Principal Partners Mid-Cap Growth Separate Account 41.56%
Principal Small Cap Stock Index Separate Account 41.03%
Principal International Stock Separate Account 48.27%
Total 37.05%

and each category takes up the following %
Principal Large Cap Stock Index Separate Account 13.30%
Principal Partners Mid-Cap Value I Separate Account 13.28%
Principal U.S. Property Separate Account $12.35%
American Funds Growth Fund of America R3 Fund 7.64%
Principal Partners Mid-Cap Growth Separate Account 7.87%
Principal Small Cap Stock Index Separate Account 8.92%
Principal International Stock Separate Account 36.61%

i'm in the most aggressive plan that was available.
 
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