The Coolest 401k Option Ever
October 15, 2008 – 5:09 am
I may be a little slower than most, but I was browsing through my company’s 401k site which is through Fidelity and I came across and interesting link at the very bottom of the page. It said “Brokeragelink”, and my mind perked up immediately.
After a little procrastination and a few phone calls I found out that Fidelity allows me to open up a brokerage account within my 401k! They had to mail me a physical form to fill out, and 2 weeks later I was up and running. I was also happy to learn that the commissions per trade are a reasonable $11/trade (I expected them to be a price-gouging $25-$30/trade, so my expectations were low to begin with).
The good news (obviously) is that I don’t have to stick with my plan’s existing funds and can instead invest in lower cost ETF’s. I consider my plan to be below average in several ways, including both the fund choices available as well as the expense ratios of the available choices.
I’ll have to put some thought into how frequently to move funds to the brokerage portion of my 401k in order to minimize trading costs, but I figure quarterly should be fine. Until then I’ll probably just continue to invest in the same funds I have been using.
Image Credit: laszlo-photo
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