Before you put another penny in a 401(k), find out what the government and your employer aren’t telling you that will scare the living daylights out of you! Here are seven frightening facts you should know about 401(k)s…

Frightening 401(k) Fact #1:

Your employer can – and probably is – making risky decisions on how to invest your money for you – without your knowledge or approval.

Many employers are now automatically directing more of your pay into your 401(k)… and automatically moving it into more risky investments – even if you had previously chosen your own investments!

And most of that money is being re-directed into “target-date” funds, which lost so much money during the last market crash, it sparked scrutiny from lawmakers and regulators. Many funds for people who pinned their hopes on retiring in one year had losses far exceeding 20%, and some funds suffered losses of 32 to 41 percent, according to Morningstar.

Shockingly, stock allocations among those funds were found to be 26%-72% of assets!

Not to mention that the fees charged by target-date funds are “significantly higher than those charged by other funds on plans’ investment menus”.

(Source: “Companies take reins of workers’ 401k’s”, MoneyCentral.msn.com, October 10, 2009)

The growth in a Bank on Yourself policy is both guaranteed and exponential. You can predict the minimum guaranteed value of the plan on the day you want to tap into it, and every point along the way.

Frightening 401(k) Fact #2:

The important decisions about your 401(k) are made by someone with no training or education in most companies.

[Read more…] “7 Really Scary Facts about Your 401(k)”