CEOs Make 300 Times the Average Worker… But It Used to Be Worse

The Economic Policy Institute released its annual roundup of CEO compensation, and it’s full of depressing data. Let’s start with the current state of things: In 2014, chief executive officers of the country’s largest firms earned 303.4 times more than the average workers in their companies. That ratio has been on the rise since 2009, when CEOs made only 195.8 times more than their employees, which was quite the fall from 2007 and 2000, when the differences were 345.3 and 376.1, respectively.

Somehow, it seems unlikely people will find much comfort in the fact that earnings used to be much more disproportionate. Interestingly enough, this triple-digit difference didn’t come about until the 1990s. In 1989, CEOs made 58.7 times more than their workers, and in 1965, they made only 20 times more.

But that was then, and this is now: The average compensation for a CEO of one of the 350 largest U.S. firms (by earnings) was $16.3 million in 2014. Annual compensation for private-sector, production and nonsupervisory workers averaged $53,200, a figure that hasn’t budged much recently. (CEO compensation includes salary, bonuses, restricted stock grants, options exercised and long-term incentive payouts.) Here’s how those changes have played out: Since 2009, CEO compensation rose 54.3%. In the same period, workers in the same industries of those CEOs saw their compensation fall 1.7%.

This is probably not surprising to all the non-CEOs out there, who have endured stagnant wages for several years. This information probably doesn’t do much for you, other than incite a little hand-wringing and consumer rage, as the cost of living generally continues to rise. There’s not much you can do about these statistics, beyond focus on your own situation and how to keep your expenses manageable, no matter how much or little you see your compensation change from year to year. Keep an eye on common costs that increase every year, like rent, taxes or insurance, and make sure you’re continuing to live within your means — it’s one of the best ways to avoid debt and maintain your progress toward stability and other financial goals.

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This article originally appeared on Credit.com.

This article by Christine DiGangi was distributed by the Personal Finance Syndication Network.


6 Credit Cards That Look Absolutely Stunning

A credit card account is more than just a financial instrument, you also get a physical object to carry around with you and present to merchants. And some card issuers feel that if you are going to carry this card around, it might as well look good. And some of the cards out there are downright stunners.

It’s easy to put a bunch of fancy graphics or attractive artwork on a credit card, and the market is filled with good-looking cards. To truly be cool these days, a credit card has to offer something different, such as novel material or a unique look. So here are six credit cards that dare to be cooler than your average piece of plastic.

1. Chase Sapphire Preferred Card

Chase Sapphire PreferredThis card comes in a shade of deep blue, with the numbers printed on the back — and not even raised. But what really makes this card stand out is the solid piece of metal within. This metal core gives it a far more rigid feel than a traditional plastic credit card, and it’s noticeably heavier. But it’s also a card that carries its own weight, by offering double points on both travel and dining, as well as the ability to transfer points to airlines, hotels and Amtrak Guest Rewards. There is a $95 annual fee for this card that is waived the first year and no foreign transaction fees.

2. Visa Black Card From Barclays

Visa Black from BarclaysThe Visa Black card is all about looking cool, and when it comes to its appearance, the name pretty much says it all. The front is black stainless steel, and the back has a carbon-fiber like pattern. This card also offers a 24-hour concierge service, airport business lounge access and a rewards program that offers 2% return on spending when purchasing airline tickets. There is a $495 annual fee for this card, and no foreign transaction fees.

3. Marriott Rewards Premier Credit Card From Chase

Marriott Rewards PremierThis is an all-black card made of metal that will probably impress whoever you hand it to. New applicants receive 50,000 bonus points after spending just $1,000 in new purchases in the first three months of card membership. You can earn 5x points for spending at Marriott properties, 2x points on airline tickets, car rentals and at airports, and 1x on all other purchases. There is an $85 annual fee for this card that is waived the first year, and no foreign transaction fees. This card is best suited for applicants with a good credit score. You can check out an expert guide to picking a “good credit” credit card here.

4. Ritz-Carlton Rewards Credit Card From Chase

Ritz Carlton RewardsIt’s no coincidence that this card looks a lot like the Marriott card, as Ritz-Carlton is a subsidiary of Marriott. Like the Marriott card, this card is also pure black and made of metal, yet it offers benefits specifically tailored to Ritz-Carlton guests, such as three upgrades to the Ritz-Carlton Club Level each year, and a $100 hotel credit on paid stays of two nights or more. In addition, cardholders receive a $300 annual travel credit toward baggage fees, Global Entry fees, seat upgrades, airport lounge access and more. There is a $395 annual fee for this card, and no foreign transaction fees.

5. Citi Prestige Card

Citi PrestigeAlthough made of mere plastic, this card has an intricate design that uniquely includes its magnetic strip on its front. Benefits include access to the American Airlines Admiral’s club and the Priority Pass airport lounge networks, a fourth night free on hotel stays, and a $250 annual air travel credit. Points can be redeemed for gift cards, merchandise and travel reservations, or transferred to miles with airline partners. There is a $450 annual fee for this card, and no foreign transaction fees. This card was named the Best Premium Credit Card in America for 2015.

6. The Palladium Card by JP Morgan Chase

The Palladium Card by JP Morgan ChaseThis card is made of a shiny metal that contains trace amounts of palladium, a rare metal that is worth more than $600 an ounce. It also contains some gold and is laser-engraved with the cardholder’s information. Benefits include numerous travel insurance and purchase protection policies, as well as access to the Lounge Club airport lounge network. There is a $595 annual fee for this card that is only offered to Chase Private Bank customers.

Before you apply for any credit card, it’s important to make sure you meet the issuer’s general credit requirements. If you don’t quite meet the requirements for a card you have your heart set on, take some time to build your credit and apply when you’re within the issuer’s preferred range. You can get your credit scores for free from many sources, including Credit.com. It’s ideal to check the same score over time so that you can more clearly track your progress.

Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.

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This article originally appeared on Credit.com.

This article by Jason Steele was distributed by the Personal Finance Syndication Network.


How Does Your Financial Planner Make Money?

Q. How much do financial planners charge for managing your money? is there a set fee?

A. Great question.

A financial adviser can be one of the best investments you’ll ever make, but you need to be informed when you pick an adviser.

Exactly how a financial planner gets paid is something that should be revealed when you interview the planner at your first meeting. If he or she doesn’t volunteer the information, or if the explanation is unclear, find another adviser.

“It is important to take stock of why you are hiring a financial adviser and what services they are providing for the fee they charge,” said Brian Kazanchy, a certified financial planner with RegentAtlantic Capital in Morristown, N.J. “Many advisers provide wealth management, which is the combination of investment management and financial planning.”

Others are paid only for their advice, and they don’t sell any products, manage investments or earn commissions on the investments you choose.

In simple terms, there are three basic ways: commission-only, fee-only and a combination of fee and commission. They may also be paid a salary plus bonuses, which would be paid for bringing in new business or selling certain products.

The combination of fee and commission is often called “fee-based,” said Jody D’Agostini, a certified financial planner with AXA Advisors/The Falcon Financial Group in Morristown.

“These advisers may receive a fee for financial planning and a commission if they sell you certain services or products that the plan recommends,” she said.

Those who work as fee-only — who don’t receive commission — will charge you for providing ongoing advice.

“The fees can be either charged hourly, as a flat fee or as a retainer fee based on a percentage of assets under management or your net worth,” D’Agostini said. “It often is based on the amount of time required to manage your account.”

What Should I Expect to Pay?

A common fee schedule for a fee-only firm that manages your investments starts at 1% of assets under management, and scales lower at various portfolio dollar values, Kazanchy said. Some firms may charge more or less than 1%, or may separate investment management and financial planning fees, he said.

Either way, you want to make sure you’re getting your money’s worth.

“A terrific advisor will (a) learn about clients emotionally as well as financially, (b) engage in goal-focused long-term planning, (c) provide invaluable historical perspective in order to foster rationality under uncertainty, and (d) actively intervene against clients’ proclivities to overreact to extreme market phenomenon both positive and negative,” Kazanchy said. “This level of behavioral coaching may far outweigh the benefits received from the portfolio management, retirement planning, estate planning, tax planning and risk management advice.”

When an adviser sells products, or his commission or bonus is based on those sales, you want to be cautious. While most advisers are reputable, some may push products that aren’t right for the customer just so they can get more money in their pocket.

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This article originally appeared on Credit.com.

This article by Karin Price Mueller was distributed by the Personal Finance Syndication Network.


Why Does My Credit Card Limit Affect My Credit Score?

Occasionally we get questions from readers who have gotten an automatic credit limit increase, and they wonder if there is a downside to accepting it. Or they close a little-used account and their credit scores go down, even though they are using cards and paying them off exactly as they had been.

What’s going on here? Credit scores are calculated in part based on how much of your available credit is being used. You can calculate your overall utilization by adding up all the reported balances on your revolving accounts (i.e. credit cards, lines of credit) and dividing that figure by the total credit limits. Credit scores also weigh in each individual account’s utilization rate.

Your amount of debt, which includes your “debt usage,” (or “utilization”) as it’s called, accounts for roughly 30% of your credit scores. That’s more than any other single factor except paying on time, which accounts for about 35% of your score. Getting a higher credit limit can be a good thing — assuming you don’t increase your debt in tandem — because it results in a lower debt utilization.

In general, the lower your balances relative to credit limit, the better. Credit experts suggest keeping this ratio at 25% or less, but if you are trying to improve your score, you may want to aim for no more than 10%. (You do want to use at least one of your credit cards, though. Having no activity at all doesn’t offer much insight into your repayment habits, and unused cards are at risk of being canceled, which would reduce your available credit and lower your credit age, another major scoring factor.) Using a credit card payoff calculator like this one can help you determine how long it will take you to get out of debt.

If you are concerned that you might be using more than the optimal amount of credit, you can set up mobile alerts to let you know when you are nearing a set spending amount. You can also pay early (or multiple times per month) to keep the balance low. This can be particularly smart if you are rebuilding credit with a secured credit card and have a low limit.

So is there any reason to even hesitate at the idea of a higher credit limit? There might be, if a higher limit will tempt you to spend more than you need to (or spend currently). A little self-knowledge can tell you if this is a danger.

Another time you may want to choose a lower credit limit is if you add an authorized user to your card. Adding someone to your account gives them access to your entire credit line. If you intend to give your child, or a significant other, access to your card, it might be wise to limit the damage that can be done if he or she doesn’t handle it as responsibly as you hoped. (You can also set up credit alerts to let you know when the card is used.)

Finally, if you co-sign a card application, be aware that this card will affect your credit as if it were your own. That means the credit limit, any late payments, etc., could affect your score. And, unless the terms and agreements say otherwise, the credit limit can be changed without your knowledge or approval if the primary borrower is at least 21 years old.

It’s one more reason to keep tabs on your credit scores. Credit.com’s free credit report summary can help you see how your debt usage is affecting your scores, how much of your available credit you’re using and how your debt usage compares to your peers.

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This article originally appeared on Credit.com.

This article by Gerri Detweiler was distributed by the Personal Finance Syndication Network.


Should You Prepay Your Mortgage?

Having debt, even “good” debt like a mortgage, can be a major stress in your life. It can be especially frustrating when you see how much of your hard-earned cash is going to pay off interest on your loan and not the home’s principal cost. You could end up paying as much as double your home’s sticker price over the term of your loan. But prepaying your mortgage can help you keep money in your pocket.

By paying more money monthly, you can cut down on the interest you owe, get your home paid off sooner and build equity faster. It can even help you reach retirement sooner. But before you jump on board, it’s important to carefully assess your financial situation and understand the basics of mortgage prepayment.

How to Prepay

First, it’s important to know the interest rate and remaining balance on your mortgage, then decide how much you want to (and are able to) prepay. You can contribute a lump sum to cut down the overall cost if you have received an inheritance, bonus or other windfall. You can also add a few dollars to each payment, make an extra (13th) annual payment, or some combination of these options.

Next, make sure that your mortgage allows you to prepay and doesn’t include a prepayment penalty. Then contact your bank or mortgage company and verify that all extra contributions will be applied directly to the principal. You can then automate this larger or additional payment so you can stay on track without having to do so manually.

Difference Between Refinancing & Prepaying

Prepaying may seem similar to refinancing your mortgage, as both can help you pay off your mortgage faster. Refinancing, however, requires getting an all-new mortgage with new terms and paying closing costs again. You’ll also need to go through a credit check again, and if you haven’t been paying close attention to your scores, that could be problematic for you. (You can see where your credit scores stand for free on Credit.com.) This is generally done to reduce interest rate, reduce payments or reduce risk of future rate increases. It’s important to calculate the point when monthly savings of the new mortgage become greater than the upfront costs of the refinance process.

The prepayment decision, by contrast, is more of an investment decision. You should consider your aversion to risk and whether prepaying your home or putting those funds into CDs or bonds will earn better yields. This includes both the better option financially and emotionally, since some people sleep better at night being debt-free.

So, Should I Do It?

Deciding to make prepayments on your mortgage is a personal financial issue. Prepaying reduces mortgage interest, which is tax-deductible and may not be a smart move depending on your tax situation. It’s also important to consider if your return on investment might be higher elsewhere. As with any other large financial decision, you should be assessing your overall goals.

Getting rid of higher-interest debt (like from a credit card or private student loan) may be a smarter decision than making mortgage prepayments. It’s a good idea to make sure you are contributing enough to your retirement savings plans to ensure you are on track for a comfortable retirement before pooling extra funds to finance your home. Prepaying has the potential to save you thousands of dollars in interest, but it isn’t right for everyone (you can check out your lifetime cost of debt here). It’s important to weigh the pros and cons carefully.

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This article originally appeared on Credit.com.

This article by AJ Smith was distributed by the Personal Finance Syndication Network.


Guess Who Won’t Be Able to Buy a Home If Interest Rates Keep Rising

Mortgage rates hit a 2015 high when the national average rate on a 30-year fixed-rate mortgage hit 4.08% earlier this week, according to Freddie Mac’s weekly survey. That’s lower than where the U.S. average was at this time last year (4.12%), but home loan pricing (rates, loans and fees, taken together) has been on the rise for most of 2015, pushing homeownership out of reach for many Americans, as the cost of a mortgage creeps up.

For example, if mortgage rates hit 6%, a third of millennials (people younger than 35 years old) wouldn’t be able to afford homes as they’re currently listed, according to an analysis by HouseCanary, a housing-data analytics company. Given that millennials make up more than a quarter of the population, their ability to buy homes will weigh heavily on the performance of the housing market, which has been driven by the baby boomers for decades.

Why do interest rates have such a huge impact on home affordability? Mortgages are huge loans, so a seemingly small shift in interest rates can change a borrower’s monthly payment by hundreds of dollars (though going from the current 4.08% rate to 6% is in no way a small shift). Timing plays an important role in a borrower’s ability to buy a house, but there’s a lot more to home affordability than the economic factors. A consumer’s credit standing will significantly impact the rate he or she qualifies for on a home loan, as does that consumer’s outstanding debt obligations and down payment on the property.

As much as potential homebuyers should monitor mortgage rates before applying for a loan, preparing to enter the mortgage process requires much more planning. In the months and years leading up to when you want to buy a home, prioritize paying down your debt and improving your credit score, in addition to avoiding unnecessary damage to your credit, like applying for new credit (that will slightly ding your score for a short time period) and running up balances on your credit cards.

If you’re planning on buying a home soon, give your credit a thorough review to see if there’s anything that needs your attention before applying for a home loan (you can start by getting your free credit report summary on Credit.com) — and take the time to figure out how much home you can afford. You’ll want to make the homebuying process as simple and surprise-free as possible.

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This article originally appeared on Credit.com.

This article by Christine DiGangi was distributed by the Personal Finance Syndication Network.


Can a Down Payment Be Too Big?

Building up savings can feel good. It’s nice to know you are working toward and getting closer to your financial goals, especially when the goal is the biggest financial decision of your life — buying a home. When you are figuring out how much home you can afford, it’s important to look at both the upfront and ongoing costs. This means calculating your potential monthly mortgage in addition to considering how large of a down payment to make. But once you’ve saved up enough for that down payment, it doesn’t necessarily mean you should rush to sign the papers. Consider the following reasons using all your savings for a down payment can get you into trouble.

Magic Number

So exactly how much of your savings should you use toward a down payment if not all? First, it’s important to find out how much you can and want to spend for a home. Many experts advise not spending more than one-third of your monthly income on housing costs, but this may vary depending on your circumstances and where you are looking to buy.

Once you figure out the home’s cost, you can determine the “expected” down payment amount as it is typically 20% of the home’s selling price for a conventional loan. (There are other options that require lower down payments.) This is probably a large chunk of your savings, and that’s OK. But it’s a good idea to leave money aside for the other costs of having a home and future financial goals.

Additional Costs

The down payment is not all you will owe in upfront costs. There are also closing costs, moving costs and the general expenses of buying and moving into a new home. Perhaps you will be buying additional furniture or making some improvements.

Also, while you may not have to pay rent once you own a house, but there are still mortgage payments, taxes, insurance and utilities to consider. Beyond that, owning a home means taking responsibility for the care and maintenance of it, which can be costly. There is no more landlord to cover repairs. Your savings will need to cover all of these expenses in additional to the down payment amount.

Savings Cushion

Even those aren’t even all the expenses you need to consider. You have probably heard that it’s a good idea to have an emergency fund in case something was to happen (think major car repair, trip to the emergency room or job loss). Even though saving for a house is a major life goal, it’s important not to leave yourself short on cash. Experts generally recommend having between three and nine months’ worth of living costs set aside. Exactly how much you need to have socked away will depend on your personal circumstances — how secure your job is, how many people in the family earn income, etc.

The exact amount you put toward a down payment for your home is up to you and your lender, but it’s a good idea to make sure it’s not all of your savings. It’s important to calculate both the immediate and long-term costs of any houses you are considering buying and find one you can comfortably afford. If you don’t feel quite ready to buy the property you have in mind, you can analyze if continuing to rent is a better move so you can keep building your savings. Keep in mind that a better credit score can help you make your dream home more budget-friendly (lower interest rates = lower monthly payment). You can check your credit scores for free on Credit.com to see where you stand.

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This article originally appeared on Credit.com.

This article by AJ Smith was distributed by the Personal Finance Syndication Network.


I Like It, I Love It: Tim McGraw Is Giving Away Free Homes to Veterans

Country singer and actor Tim McGraw announced he will continue to give away mortgage-free homes to U.S. veterans, which he has done in partnership with Operation Homefront and Chase Bank since 2012. So far during McGraw’s Shotgun Rider Tour 2015, six veterans and their families have received loan-free homes.

Since 2012, McGraw, Operation Homefront and Chase have awarded more than 100 veteran families homes, without requiring them to take out a mortgage, as most homeowners must. Before McGraw’s tour ends in September, an additional 30 servicemembers will receive such homes.

Buying a home without a mortgage requires a massive amount of cash — and there are plenty of reasons other than cash flow to finance a home purchase — but getting a mortgage isn’t easy. Since the collapse of the housing market several years ago, mortgage credit has been tight, leaving many consumers with good credit unable to obtain a loan. Even with programs geared toward helping veterans and first-time homeowners, buying a house is still a big undertaking, which is part of the reason McGraw has continued his program. “[These are] people who have given us security for a lot of years, and we’re able to do that back for them in a small way,” McGraw said in a news release.

There’s a lot that goes into buying a home, not least of which is the availability and affordability of homes in your area. If you’re able to find a house you think fits your budget, whether you can buy it depends on how much of a down payment you can afford, how much outstanding debt you have, your credit history and the interest rates available to you — the difference of a few points in your credit score or home pricing could change your monthly payment by hundreds of dollars, costing you big time over the life of the loan. (You can get your credit scores for free on Credit.com to see where you stand.)

For those hoping to benefit from a little luck, why not search for homeownership sweepstakes like McGraw’s or the one associated with Lady Antebellum’s 2015 tour? (These things are more common than you might think.) Sure, winning a contest is a long shot, but you can still achieve your dreams of buying a house if you work on your financial health and credit standing. It may be tricky to get a mortgage, but there are many things you can do to improve your chances, like pay down your debts, track your credit score to improve your weak spots and look into any programs you might qualify for to make the loan more manageable.

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This article originally appeared on Credit.com.

This article by Christine DiGangi was distributed by the Personal Finance Syndication Network.


What’s the Most Money I Can Get Out of Social Security?

Social Security retirement benefits are meant to supplement retirement income with contributions made during working years. It may be hard to see the money go missing from your paycheck, but the idea is that when you hit your mid-60s, you will be glad to have some money coming in. A Social Security calculator can help you estimate what benefits you can expect. And while you may have a general idea how your benefits are calculated, here’s some information to help you brush up on the details.

What’s the Maximum You Can Receive?

How much you receive in monthly Social Security benefits is determined by factors including how long you worked in a qualifying job, how much you made, and your age at the time you start collecting those benefits. The maximum Social Security benefit you can receive is set, and that amount changes each year. There is an incentive for people to wait until full retirement age (66 or 67 depending on when you were born) or even longer (until you reach age 70) to start collecting benefits. In 2015, the maximum monthly benefit is $2,663 if you are at full retirement age, but could be $3,501 if you wait to start to receive payments at 70 years old.

It’s important to think about what your average monthly expenses will be and be sure that you have enough external retirement savings to supplement the maximum benefit (and really, the benefit you qualify for) so you know you are in good shape for living the life you want in retirement. But how does the SSA calculate the maximum benefit payments anyway? The math is based on the maximum wage base for the year, the indexed wage base, and any applicable cost-of-living adjustments (COLA) that would apply.

Cost-of-Living Adjustments

So, what exactly is COLA and how does it work? The Social Security Administration realizes that even though you made a certain wage 40 years ago, inflation may mean that it will take more money to live a similar lifestyle. Your other retirement income streams do not offer this type of protection.

But, as conscientious as it sounds, the SSA has actually taken a lot of criticism for this policy lately. For the first 35 years of the program, COLA only dipped below 2% three times but five out of the last six years have seen sub-2% adjustments. While seniors have been complaining that this is not high enough to help them cope with rising costs, inflation has been low for prices across the board lately.

COLA is calculated based on a number called the Consumer Price Index for Urban Wage Earners and Clerical Earners or CPI-W. The CPI-W considers a “basket” of goods to see how inflation is affecting citizen in real time, but many complain the goods used in the calculation are not senior-specific and thus, unrealistic. In 2015, the adjustment was a 1.7% increase, meaning the average Social Security benefit check has increased by $20 to $30 per month this year. If this doesn’t seem like enough to you, it’s important to save even more money or look for ways to cut back in your retirement budget.

Social Security was never designed to be your sole income in retirement. It’s a good idea to calculate your benefits estimate regularly and be sure you are saving enough in other ways like IRAs, 401(k)s and other employer-sponsored programs. The best step you can take for your retirement is getting educated to save early and generously.

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This article originally appeared on Credit.com.

This article by AJ Smith was distributed by the Personal Finance Syndication Network.


5 Signs You Have the Wrong Retirement Plan

Are you winging it when it comes to planning for retirement? Do you have a sinking feeling that something’s not right? Here are five signs you have the wrong retirement plan, and what you can do about it.

1. You’re Paying More Than 1% in Fees

It may not sound like a lot, but it is. If you have $10,000 invested, it can either grow into:

  • $290,000 in 40 years via a mutual fund that charges 1.2%, or
  • $420,000 through a 0.2% fee fund (assuming a 10% annual gross return in both cases).

Search for the name of your retirement funds, and go to the fee section. Certain funds, including those labeled Class A, B, and C, have fees that can make them prohibitively expensive for the average investor.

The White House released a report in February 2015 criticizing the financial industry for hidden fees, which is costing working and middle-class families $17 billion a year.

2. You Randomly Chose Several Mutual Funds to “Diversify” Your Portfolio

Most of us instinctively understand the notion of diversification. So when we’re filling out our 401(k) enrollment form, we think it’s wise to choose several funds. We all know the axiom: Don’t put all your eggs in one basket.

The problem is, we’re often choosing blindly, with limited knowledge of what we are investing in. It could be really risky, too conservative or too expensive.

In this case, it may serve you better to go against your instincts and just pick one – a target retirement fund. This will automatically diversify your portfolio across major asset classes (U.S. stocks, international stocks, bonds). It will also adjust your portfolio as you approach retirement, from an aggressive one to a more balanced mix.

3. You Overlooked Index Funds

Index funds allow us to own a diverse array of stocks across various sectors, at a significantly lower cost. And remember, lower cost = higher returns.

Index funds are less expensive because they have no need to employ fund managers to select stocks that might perform exceptionally.

Time and time again, studies reveal that active stock pickers underperform the market (index funds just mirror the market). According to the 2014 study by the S&P Dow Jones Indices, more than 82% of U.S. large company stock funds underperformed the benchmark over one-, five-, and 10-year periods.

One caveat is you won’t get a chance to get outsized returns, like what Warren Buffett did for Berkshire Hathaway shareholders. Berkshire’s stock price increased by a whopping 1,800,000% between 1964 and 2014!

4. It’s All Sitting in a Money Market Fund

I get it. You realize you don’t know anything about investing, and you’ll rather keep it safe than lose your money in a risky investment. Or you can’t stomach the thought of going through another 2008 financial crisis-type loss.

But think about it. If you invested $10,000 in the U.S. stock market in 1950, it would be worth $6.9 million by 2013. That’s despite the Korean War. Vietnam War. Cold War. Oil Crisis. Saddam Hussein. Dot-Com Bust. 9/11.

In contrast, if all these events scared you off and you invested instead in U.S. Treasury bills, your $10,000 would only be worth $406,000. You left more than $6 million on the table.

5. You’re Contributing Only 5% of Your Salary Toward Retirement

If you are a recent college graduate, you should be saving about 13% of your gross income toward retirement (including matching employer contributions).

You are on track if you are 28 years old and your retirement account balance is about 50% of your gross salary. For example, if your annual salary is $50,000, your 401(k) should be worth $25,000.

If you’re 38, you should have saved about 2x your gross salary.

If you’re behind on these guideposts, you’ll need to save more than 15% of your gross pay to catch up.

Look for ways to find money in your budget, or use budgeting apps to help you achieve your monthly retirement savings goal.

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This article originally appeared on Credit.com.

This article by Alvin Carlos was distributed by the Personal Finance Syndication Network.