What's Wrong With Your 401(k) -- and How to Fix It

Investment Overload

The only thing worse than a limited number of lousy choices is a lengthy list of funds that are equally terrible. More is definitely not better when it comes to 401(k) plans.

Some retirement plans offer dozens of funds to choose from. The lists are simply overwhelming. I write about mutual funds for a living and I don't have the patience to go through all of the options I've seen in some 401(k)s.

And even if you did spend hours, days and weeks trying to research all of these funds, you'd probably find out that many of them are very similar: weak-stock funds that cost a lot to own.

Solution: If you're overwhelmed by the number of funds in your plan, you can winnow the list down by looking for the names of good, solid fund companies. You can hone in on names like Vanguard, T. Rowe Price, Fidelity, American and Pimco. Then the picking becomes a little easier.

Few Fund Facts

Your plan might have a manageable number of choices in it. But you still face the chore of trying to dig up information about these funds.

On the Web site for Franklin Templeton's defined contribution participants, you get a list of your plan's funds, their ticker symbols, prices and performance through the end of the month.

That's it.

No expense ratio. No general description of what the fund invests in. Nothing.

There is a quick link to each fund's prospectus. But that disclosure document is filled with mind-numbing legalese and lots of footnotes in tiny print. Why don't they tell you upfront what the funds cost? Probably because if it was clear what you were paying for some of them, you might not put your money in them.