Vanguard Level 2 Quotes

**( 401(k) Mistakes (and How to Fix Them in a Pinch)** > *"Your 401(k) is your future — but one misstep today can cost you tomorrow."* Even smart investors get it wrong when it comes to saving for retirement, and quietly nibble away at their assets. You might be committing one of the following **7 common 401(k) errors** if you've ever wondered why your balance is not growing as you expected. The bright side is that all have a straightforward solution. ???? #### ⚠️ **1. Not Contributing Enough to Get the Full Match** One of the biggest **401(k) mistakes** is not leaving free money on the table. **Solution:** Always contribute enough to get your employer's full match — it's a 100% return on investment. #### ???? **2. Not Paying Attention to Fees and Expense Ratios** Big fund or administrative fees can quietly deduct from your 401(k) in the long term. **Solution:** Invest in low-cost index funds or ETFs and review your plan's expense ratios each year. #### ???? **3. Failing to Rebalance Often** Your portfolio gradually drifts out of alignment with your goals. **Solution:** Get automatic rebalancing in your 401(k) at least once a year to maintain your target asset allocation. #### ⏳ **4. Cashing Out When Changing Jobs** Perhaps the worst **401(k) mistakes** you can make is cashing out when you switch jobs. Early withdrawals tax and penalize you. **Solution:** Transfer your 401(k) to your new company's plan or an IRA instead of cashing it out. #### ???? **5. Taking Too Little (or Too Much) Risk** Investing too conservatively can stunt growth, while being overly aggressive invites volatility. **Fix:** Adjust your risk level according to your age and retirement horizon using Fidelity’s or Vanguard’s asset allocation tools. #### ???? **6. Failing to Increase Contributions Over Time** If your contributions stay the same year after year, you’re losing ground to inflation. **Solution:** Increase your 401(k) contribution 1% each year — a small change that pays a big dividend. #### ???? **7. Overlooking Older 401(k) Accounts** Most individuals abandon previous accounts upon job changes — another common **401(k) mistake**. **Solution:** Consolidate your 401(k)s into one plan to simplify management and enjoy more effective investment tracking. > *"Your 401(k) doesn't grow by accident — it grows by attention."* Avoiding these **7 typical 401(k) mistakes** will keep your retirement funds secure, your earnings maximized, and you with long-term financial freedom. #401k #Retirement #Finance #Investing #PersonalFinance #401kMistakes #RetirementPlanning #MoneyManagement #FidelityInvestments

The three tools Once you’ve sorted through your three considerations, you are ready to build your portfolio, and you’ll need only these three tools to do it. See, I promised this would be simple! 1. Stocks: VTSAX (Vanguard Total Stock Market Index Fund). Stocks provide the best returns over time and serve as our inflation hedge. This is our core wealth-building tool. (See Chapter 17 for variants of this same fund.) 2. Bonds: VBTLX (Vanguard Total Bond Market Index Fund). Bonds provide income, tend to smooth out the rough ride of stocks, and serve as our deflation hedge. 3. Cash: Cash is good to have around to cover routine expenses and to meet emergencies. Cash is also king during times of deflation. The more prices drop, the more your cash can buy. But when prices rise (inflation), its value steadily erodes. In these days of low interest rates, idle cash doesn’t have much earning potential. I suggest you keep as little as possible on hand, consistent with your needs and comfort level. Typically, money market funds pay slightly more than bank savings accounts, but not always. And while money markets are considered to be extremely safe, they don’t offer the FDIC insurance (up to $250,000) found with bank accounts. At various times, we’ve kept our cash in our local bank or in our online bank. But normally, I slightly prefer the money market option, and at the moment here in 2025, ours is in Vanguard’s VMRXX (Vanguard Cash Reserves Federal Money Market Fund). So that’s it. Three simple tools. Two index mutual funds and a money market and/or bank account. A wealth-builder, an inflation hedge, a deflation hedge, and cash for daily needs and emergencies. As promised, the combination is low cost, effective, diversified, and simple. You can fine-tune your allocation in each investment to meet your own personal considerations. Want a smoother ride? Willing to accept a lower long-term return and slower wealth accumulation? Just increase the percentage in VBTLX and/or cash. Want maximum growth potential? Hold more in VTSAX. In the coming chapters, we’ll talk about index funds and bonds. Then we’ll explore a couple of specific strategies and portfolios to get you started and take a look at how to select the asset allocation best suited to your needs and temperament.