By not participating, you are basically throwing away money. Your employer should provide you with ample information before your participation. Read all the information and take note of things like whether your employer offers matching contributions, when and how often you can change your investment choices, and what your investment choices are. And, if you find that many of your colleagues have questions as well, request a meeting to walk through some of these gray areas. Without understanding how your car works, you can t possibly drive to the best of your ability.
Some employers provide employees only with a few options, while others offer dozens.
Each mutual fund has a purpose which may or may not appropriately lead to your outlined retirement objectives. Be sure to look at the length of time each of these funds requires to optimize returns. The longer your investment horizon, the more risk you may be willing to shoulder and therefore the more aggressive some of your investment choices can be. Investigate the level of risk that each of these funds is exposed to. All investment vehicles have some risk, but depending upon the type of securities that the vehicle holds, an investor will experience different levels of volatility.