Free 401(k) Analysis

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For most Americans a 401(k) is an essential part of the retirement plan. Pretty much anywhere you look for advice on saving for retirement you’ll read that you should be contributing to a 401(k) regardless of your age… especially if your employer matches your contributions.

It’s no secret that contributing to a 401(k) is a good step towards preparing yourself for retirement. But what you invest in is also important.

If you’re like most people you probably picked a few mutual funds when you were filling out paperwork at a new job. Those decisions are often made quickly and without much research. While you can change your allocation later, most people don’t think about it and just keep things the same.

Many 401(k) plans include funds that aren’t great choices either because of high fees, past performance, or simply because it’s not a good fit for your personal situation. And since most of us don’t take much time to pick the right investments for our 401(k), poor choices are common.

One of the best things about a 401(k) is the fact that contributions are usually automated. You pick a percentage of your salary that you want to contribute, and that money goes into your 401(k) immediately without any action on your part. It’s taken straight out of your paycheck with no chance for you to get distracted or forget to make the contribution.

However, because the contributions are so hands off, most of us don’t give much thought to our 401(k). That means if you made poor choices when you decided how to invest within your 401(k), those poor choices are probably sticking with you for a long time, and killing your retirement savings.

Even if your 401(k) was set up very well to begin with, you should probably take some time every now and then to review it to be sure the same approach still makes sense for you.

Today I want to tell you about a free resource that takes only about 5 minutes of your time and can be incredibly valuable for improving the way your 401(k) is invested.

Your Free 401(k) Analysis

Blooom offers a free 401(k) analysis to anyone. There’s no catch and it only takes a few minutes of your time. I’ll walk through the process below, but if you want to get started you can head to this page for your free analysis.

  • You don’t need to enter a credit card or any payment information.
  • It doesn’t matter which company holds your 401(k) and you don’t need to transfer anything.
  • Just answer a few basic questions and sign in to your 401(k) account.
  • Blooom will analyze your current 401(k) investments and provide you with a report.
  • You don’t need to speak to anyone on the phone, it’s fully online.

The Basics of Blooom

Blooom is a robo advisor that specializes in defined contribution plans like 401(k)s and 403(b)s. While many advisors don’t deal with 401(k)s, Blooom fills the void.

The company takes the approach of trying to make retirement investments simple. The fee for the service is very straightforward. If you choose to use Blooom’s services you’ll pay $10 per month, regardless of the size of your account. There are also no minimums, so you can start using Blooom even if you are just getting started with your retirement savings. Even Blooom’s website and user interface favors simplicity and clarity.

As a Blooom client you’ll benefit from having your 401(k) fully managed. Blooom will monitor your investments and rebalance when needed. They’ll help you to get the returns that you need while minimizing fees. You’ll also have access to an expert advisor.

You won’t need to transfer your money in order to use Blooom’s services. Blooom will not hold your investments, they simply analyze and manage. So it doesn’t matter where your 401(k) is, you can still use Blooom.

How the Free Analysis Works

The free 401(k) analysis is very simple and straightforward, but I will explain the process a bit here. To start with, head to this page and click on the “start now” button.

Blooom 401(k) Analysis

On the next screen you’ll be asked to enter your name, date of birth, and target retirement age. After that, you will enter your email address and create a password.

Blooom will then ask you a few simple multiple choice questions to get a feel for your comfort level with risk. After those questions it will show you the ideal mix of stocks and bonds based on the amount of time you have until retirement and your tolerance for risk.

Blooom 401(k) Analysis

Next, you’ll login to your 401(k) account, wherever it is held, so Blooom can see how you are currently investing. Blooom will quickly let you know how you are doing in some areas like fees, risk, and diversification.

Blooom Review

Then it will go through each item in more detail. Here is where you get some useful information. Even if you decide not to use Blooom to manage your 401(k), you can still take this data and use it to make changes to the investments yourself.

Blooom Analysis

If you click on “tell me more” on any of these screens you’ll get a lot more information.

Blooom 401k

At the end, Blooom will estimate how much better off you could be if you use their services.

Blooom - is it for you?

At the end of the analysis you will have the option to sign up for their services if you’d like.

Is Blooom a Good Fit for Me?

Blooom’s free 401(k) analysis is a great resource for anyone that has a 401(k) or 403(b). It’s totally free and only takes a few minutes of your time. The information that you get is specific and valuable. Even if it simply tells you that your current investment choices are ideal, at least you got confirmation. But most likely, you’ll get some suggestions that can be applied to improve your 401(k).

As far as Blooom’s advisory services are concerned, they may or may not be a good fit for you. Like other robo advisors, Blooom is ideal for hands-off investors. Blooom will make decisions for you, based on the information and details that you provide. If you prefer to be very active with your investments a robo advisor is probably not a good fit.

With a flat fee, Blooom’s fee structure is different than most robo advisors that charge a percentage of the money being managed. The flat fee becomes a really good deal the more you have invested, but when you are just starting out the flat fee can wind up costing you more than a percentage-based fee likely would cost.

Because you don’t need to move your investments in order to use Blooom’s services you can easily give it a try if you’d like. If you try it for a month or two and decide it’s not for you, you can simply cancel the service and there is nothing else you need to do.

One thing to point out is that Blooom tends to be aggressive in it’s advice.

Personally, I took advantage of the free analysis for my 401(k) as well as for my wife’s 401(k). We’ll both make some changes based on the information from the analysis, but we’re not signing up to have Blooom manage our 401(k)s. I think it is a good service for the right person, but I prefer to be more hands-on with my investments.

Get your free 401(k) analysis here.

Free 401(k) Analysis

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