Stay Away from High-Cost Investments

Generally, employees do not get to decide which 401(k) provider should be used by their employers. However, as an employee, you do have a say in terms of your own investments. Similar to regular investment accounts, some investments are more costly than others.

For instance, verify the expense ratios of mutual funds or ETFs against other available alternatives. If you find a cheaper fund with similar options and benefits, you’ll be tempted to choose that one, except that over the 20, 30 or 40 years you contribute to your 401(k) plan, all the minor costs related to this fund can add up. In the end, you might pay more money than if you had stuck with a more expensive but transparent fund.