How Often Do You Review Your Retirement Portfolios?

July 23, 2009 at 3:55 AM 9 comments

In January a friend of my husband’s asked his employer, (a very small company with less than ten employees), to increase his personal 401(k) contribution from 5% to 10%. Now the friend assumed that the employer made the change and went about his business for the next six months. In fact, he assumed everything was perfectly fine until a few days ago when he logged into his 401(k) account and realized the company failed to make the change.

He was annoyed and angry and contacted his employer in search of retribution. He believes the company owes him money, because the market has been rebounding ever so slightly and without increased contributions he feels he missed out on the rise.

While my husband felt sorry for his friend, I must admit that I thought his friend was as much at fault as his employer. After all, his friend could have logged on to his 401(k) at any point over the last few months to check his contribution level. If he had taken just one minute in the last seven months he could have logged in, looked at his balance, checked his contribution level and realized the employer’s mistake.

Instead, he waited seven months to review his account and then blamed his employer for failing to make the change he requested. While I agree that the employer should have made the change, I believe the employee is equally responsible in verifying that the change actually occurred.

I typically peek in on my 401(k) every few weeks just to check the balance, so I certainly would’ve caught an error like this one by the second pay period. But this scenario definitely got me thinking: Is it unusual for an employee to check his or her balance so often? How often do most retirement contributors review their holdings?

When I asked around the office a couple of coworkers told me they’ve never logged into their 401(k) accounts. A few others haven’t logged in for so long that they can’t remember how to log in and a few of those who could remember didn’t know their passwords.

One friend told my husband he completely lost track of his 401(k). He worked for a company during the dot-com era that no longer exists. With the company out of business he can’t contact the HR department and he can’t remember which investment firm managed his 401(k). He remembers opening and investigating in that account, but he has no idea which firm held his money. For the time being he’s written off that money, because he has no idea how to get a hold of it.

So what about you? How often do you review your retirement portfolios? How long would it take before you recognized an error like this one?

Entry filed under: retirement. Tags: .

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9 Comments Add your own

  • 1. Heather  |  July 23, 2009 at 11:34 AM

    I check my 401K about once a week. I stopped checking for a few months when the market tanked because it wasn't doing my mind any good to see the numbers drop. I would have caught the lack of a change within two weeks since our contribution levels are marked prominently on our pay stubs.

    Reply
  • 2. Sense  |  July 23, 2009 at 4:31 PM

    Uh…did he not notice that his paycheck stayed the same?! yeah, he is at fault as much as the company, for sure.

    Reply
  • 3. Chaya  |  July 23, 2009 at 9:38 PM

    I've add my account to Mint.com so I can review it any time I log in to check my finances.

    Reply
  • 4. Ms. V  |  July 24, 2009 at 12:36 AM

    Like Heather, I check my account (both 401K and separate rollover IRA) about once a week. But I would at least check once per month because I tend to record the balance on the last day to track performance monthly. And I agree with Sense… didn't he figure out how much his take home pay would be after he started contributing more? That should have been an early red flag.

    Reply
  • 5. laura @ so alaurable  |  July 24, 2009 at 12:16 PM

    I would have noticed the difference in my paycheck the first time it went through. I probably log in to check my 401k and Roth IRA performance about twice a month, but I use Quicken several times a week and would have noticed a change there as well.

    Reply
  • 6. One Frugal Girl  |  July 25, 2009 at 3:11 AM

    My husband claims that his friend may not have noticed the paycheck discrepancy because he's paid an hourly wage and may work different hours each month. I still think he'd have a general idea how large his paycheck should be, but I suppose his hours could vary greatly.

    Reply
  • 7. elizabeth  |  July 25, 2009 at 5:06 PM

    I must confess that I rarely check mine. Well, I did check it this past week because I had a specific reason why I was curious about the balance in general. But otherwise, I might log in once a year, usually after our company contributions deposit in the beg. of the year, to see what the total was (they announce the %, but I never really know what that means in $ amount). :)

    Reply
  • 8. bluntmoney  |  July 28, 2009 at 2:11 AM

    Whenever I make a change to anything financial, I double-check to make sure it actually took effect. I can't help but think that he wouldn't be upset if the change had been forgotten and he'd LOST money.

    Reply
  • 9. Sarah  |  July 28, 2009 at 12:25 PM

    Well, I do receive 401k/IRA/investment statments every quarter which I reveiw. Other than that, I log on about once every month or so. With my 401K, I also see my contributions on my paystub (bi-weekly). Other investments, I see withdrawals from our bank account monthly.

    *I* think it's up to the individual (not the company) to make sure this is correct.

    Reply

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