401k and mutal funds?
Answer:
A 401K is an employer sponsored retirement savings plan. It allows workers to put a portion of their earnings into savings before taxes are take out.
The name '401k' comes from the part of the federal tax code that created this.
For more information on 401K:
http://www.answers.com/topic/401-k.
Most 401K plans allow workers to select from a list of investments, most of which are usually mutual funds.
Mutual funds are investment pools. Each investor puts in their money for a professional to manage. Mutual funds come in a wide variety of styles.
For more information about mutual funds:
http://www.investopedia.com/university/m.
Generally, it is a good idea to invest in a 401K if your employer offers one. It allows you to pay less taxes, and makes it easy to save money. Many employers offer matching plans where they actually put money into your account if you participate.
The only possible negative in a 401k is not making informed choices on investment options.
I dont have enough time to explain it all right now, but the major con is NOT having a 401K. If your employer offers one, sign up as soon as you can and make sure you put enough to get the full match.if they offer one. You never want to throw away free money.
A 401k is a company sponsored retirement plan. Every company's plan may be different, so you need to speak with HR about yours.
A mutual fund is a pool of money managed by an investment manager who's job is to make it grow by investing. My favorite mutual fund specializes in real estate, UMREX, Excelcisor Real Estate Fund.
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