Saving for retirement is hard enough. Unfortunately, many of us make it even harder, often without even realizing it. Here are six things I worry about when I worry about your 401(k) – and what you can do to help me stop worrying:

  • Worry Number 1: You took the automatic deferral rate as a recommendation.

The average automatic deferral rate has risen to nearly 4%. It’s not enough. But many people assume that the auto deferral is a recommendation from their employer about what they should be saving. It’s not; more than likely, it’s as much as they think you’ll agree to.

What to do: A combined 10% between your deferral and the company match is a more reasonable target. If you can’t do that today, see if your plan has auto-escalation so that you can gradually increase your deferral rate.

  • Worry Number 2: You picked a great fund – ten years ago.

Remember when you enrolled in your plan, studied the investment menu, did your homework and picked a great fund? Well, that was ten years ago and a lot has changed since then. You need the time, inclination and skill to pick funds successfully over the long haul.

What to do: Consider a target date or asset allocation fund that evolves with you, so you can focus on increasing your contributions.

  • Worry Number 3: Your future is leaking away.

For many people, the idea that they can get to the money in their 401(k) in an emergency makes it easier to participate. But loans and hardship withdrawals, while seemingly unavoidable in extreme circumstances, come at a cost to your future. Taking a loan should be a last resort.

What to do: If you have a loan out, pay it back as quickly as you can. Get your money back to work building your future.

  • Worry Number 4: You are ignoring your 401(k).

Which are you, the person who never opens your 401(k) statement or the person who checks online every day? I hope you are – neither. You need a sound strategic plan and the discipline to stick with it. However, the plan needs to be reviewed to make sure it is still on track and that your needs haven’t changed.

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