401(k) questions

[Megansman]

I was under the impression that once my 401(k) had some money in it that I could self-direct a portion of it. When I go to the website to try to do so I can only get into the various funds offered. Am I missing something here? Am I mis-informed? And finally, why does the k in 401(k) have parenthesis around it?

[OldUPSDriver]

The (k) is just part of the Internal Revenue Code.

[toeknee2gx]

u have to have a certain balance in your account in order to get a self-managed account

[jasar13]

Originally Posted by Megansman

I was under the impression that once my 401(k) had some money in it that I could self-direct a portion of it. When I go to the website to try to do so I can only get into the various funds offered. Am I missing something here? Am I mis-informed? And finally, why does the k in 401(k) have parenthesis around it?

I see nothing saying you have to have a minimum in your 401K to open a Self Managed Account. I don't believe that is true.

After you log in to the 401k site either:
1. under the Select An Option drop down click on UPS Savings Plan OR
2. Under My Retirement Plans click on the UPS Saving Plan link

On the next page click on FORMS at the top.
Choose #7 SMA Application Form.

The .pdf file tells you all about the SMA process.

File out the form and submit it to open a Self Managed Account. It took about 3 weeks from the time I submitted the paperwork for me to be able to trade in my SMA account.

Good luck.

[Can You Come Back?]

You can transfer as much money as you want into your SMA......the only requirement is that you leave a minimum of 5000 dollars in your 401(k) core account. Since you just opened your account, you still have some saving to do!

This information is in the fine print somewhere, but it is there.

The (k) pertains to subsection k of section/article 401 in the IRS code. Google it to learn more.

Good luck with your 401(k)........over time, it will be one of the smartest decisions you ever made.

[Dfigtree]

Originally Posted by Megansman

I was under the impression that once my 401(k) had some money in it that I could self-direct a portion of it. When I go to the website to try to do so I can only get into the various funds offered. Am I missing something here? Am I mis-informed? And finally, why does the k in 401(k) have parenthesis around it?

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https://upssavings.csplans.com/info/...Adhlv8M0K1Szsw==

Frequently Asked Questions

Question :
How does the Self-Managed Account work?

Answer :
The Self-Managed Account (SMA) is a brokerage option that offers you the ability to invest in stocks, bonds and other mutual funds. You have to apply for and set up a separate Self-Managed Account before you can trade stocks, bonds and mutual funds.

You can request an SMA application by calling the UPS Savings Advantage Information Line at 1-800-541-6154. The package includes instructions on completing the application. After you’ve mailed your completed application to State Street Global Markets, you’ll receive a welcome letter with your brokerage account number.

Once your account is open, you will need to transfer a minimum of $2,500 from your core investment funds into your SMA. On-line trading is available, or your may call an SMA broker to make trades. You must leave a minimum account balance of $5,000 invested in the UPS Savings Plan core investment funds immediately following your initial transfer to your SMA. All subsequent transfers into your SMA must be a minimum of $1,000.

There is a $50 annual account fee to maintain an SMA, and other transaction fees may apply. The annual account fee will be waived if your transaction fees exceed $50 per year. All fees are outlined in the application package. You may also utilize the dividend reinvestment plan (DRIP) feature for an annual fee of $20. This fee is waived if your SMA balance is greater than $75,000.

All purchases and sales of UPS stock are subject to the UPS Insider Trading Guidelines.

[beatupbrown]

Looking back at the last 78 years, the performance of the stock market as a whole has averaged near 12 percent annually; yet the average return of the single stock investor is closer to 7 percent annually. Mutual funds typically hold 50 to 250 stocks in their portfolio. They hire mathematical geniuses to determine exactly how long to hold them and when to sell them to maximize returns. The average investor is simply not going to compete with the brains of most mutual funds, long term. Also, if you place much of your nest egg with one or two single stocks, your risk skyrockets. Thirdly, your sleep will be much less restful when your nest egg stock doesn’t meet earnings, sees it’s CEO locked up for fraud, or takes a 35 percent plunge because the analysts decided your stock is a hold instead of a strong buy. If you must satisfy your need to test your brother in law’s hot stock tip, Dave strongly suggests limiting this to no more than 10 percent of your portfolio. NOTE: By the time you get the hot tip, it’s old news to our friends inside the mutual funds.

[Dfigtree]

Originally Posted by beatupbrown

Dave strongly suggests limiting this to no more than 10 percent of your portfolio.

Diversify across asset classes. Period.