When planning for retirement, you will have a lot to take into consideration. One of the best and most involved resources you have is your 401(k). It is hands down the most generous retirement invest out there, but all the benefits it has to offers will only pay off if you are proactive and make smart investments. Unlike pensions or social security, where you just have to show up to work to reap the benefits, 401(k) retirement plans give you more control and more responsibilities.

Making the right investments is the key to getting a generous return from your 401(k)retirement plan when it is time for you to retire. While you might think the best thing to do is to pour your investments in the company you work for, but most experts advise against it. In fact, investing a large part your funds in any single company is never an good idea. Any good long term investment portfolio is spread out across many stable companies in different industries. That way if one company or an entire industry fails you only lose a fraction of your investments and as the recent recession made clear, it’s not impossible for any company to fail.

As far as what companies you should invest in, that is left completely up to you. Not even the company you work for will tell you where you should invest your money. If you don’t have time to learn how to invest in your 401(k), the best thing you can do is hire a personal financial planner. They can help you to chose the right type of investments to make, help you track , and make adjustments to reach your retirement goals. If you do have the time and want to learn, I recommend you read 401(K) Take Charge Of Your Future by Eric Schurenberg it is a good book to get you started. It is impossible for me to cover all your options in this article, but I will be writing many articles covering retirement planning, check the investing section of this site for more information.

Many companies now offer 401(K) as the primary retirement plan. Which is a great thing if you know how to make it work for you. But how can you tell if the 401(K) plan a company is offering is top notch or bottom shelf. Well, I will list 6 of the features you should look for when considering joining a companies retirement plan. Please note that even if the plan does not have most of these features, 401k is still the best retirement plan you will come across any time soon.

1. The company match 70 cents to every dollar you put invest. There are only a few companies that do not offer to match a percentage of what you contribute, these are usually small companies. Large companies that are looking to get and keep talented employees are willing to match at least half of what you invest. Some companies will even match you dollar of dollar and a few rear companies will one up you.

2. If you can contribute up to 14% of your salary. Obviously the more you save the faster you will reach you goal, but not all 401k retirement plans allow you to invest such a large part of your salary.

3. The plan allows you to take a loan or allow withdrawal for hardship. Taking money out of your retirement plan is never a good idea, but sometimes it is unavoidable. Many companies will allow you to use some of your investment when you are in a financial crisis, but you will have to prove that it is your last hope and you will have to the pay taxes.

4. If you get updates and the ability to transfer money among funds daily. One of the best features of any 401(K) plan, is that you are in control of your investment. Having these features give you great flexibility to put you money where you see fit.

5. Speaking of flexibility, a top notch plan should have at least 10 investment options. Most companies offer at least 6, but the more options you have the better.

   These are 5 features that some of the best 401(K) plans offer. Your company might not offer all of them, but even a few is better than none.

Investing is a scary subject for many, especially young adults. As young adults, we want to enjoy life and saving and investing is usually the last thing on our minds. Ironically, it is the time we should be investing heavily and planning for retirement. A little thing called compound interest can turn $50,000 into over $1.5 million in 30 years time. This is the biggest advantage young adults have when it comes to finances.

Almost any form of long term investments is good for young adults and the amount they have to invest is small compare to older folks. A 25 year old can more than triple their initial investment in 30 years, without adding another dime to it. Imagine if are 25 years old and you invested $20,000 into an account bearing 4 percent interest monthly. In 30 years time you would have somewhere around $65,000 in your account and you don’t have to invest another dollar. Now imagine if you invested another $50 monthly for the next 30 years, that would be somewhere around $100K. Over the 30 years time, you would have only added $18,000 for a total of $38,000 invested and a profit of $62,000.

The reason more young adults fail to take advantage of this powerful technique, is simple lack of knowledge. They do not know it exist and how powerful it is. We usually learn this later in life and try to play catch-up, but time is something we can never get back. I have said before that personal finance should be a mandatory part of every high school, but it is not. It is left up to parents to teach their children about saving and investing, but most parents know just as much as their child. It is an easy subject to grasp and with extensive resources to help you learn and it is available to all young and old.