Your 401(k) plan is filled with clunkers? Don't stand idly by. For starters, express your concerns to your employer's benefits manager. Use the information in this article -- pointing out funds that charge lower fees and have posted better returns than the portfolios offered in your plan -- to persuade your employer to offer better 401(k) options.
At the very least, make sure you have access to a variety of asset classes and push for more if you don't. According to the Plan Sponsor Council of America, 401(k) plans on average offer 19 funds, including U.S. stock funds, foreign stock funds and U.S. bond funds. Most plans also offer target-date or balanced funds. But you can lobby to get your employer to add, say, a technology or real-estate sector fund or an emerging-markets stock fund.
If the quality of your 401(k) choices varies, load up on the good funds in your plan and look elsewhere to balance your retirement savings. Say your plan has a terrific large-company fund, such as Fidelity Contrafund, but its bond-fund choices are wanting. Invest in Contrafund inside your 401(k) and buy a first-rate bond fund or two inside a tax-advantaged retirement account, such as a traditional IRA or a Roth IRA.
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