Money Talks News: Why You're Stressed About Your 401K and How to Get Over it

For many, if not most, American workers, their 401k or similar plan is the primary way they're saving for retirement. But that doesn't mean they feel comfortable about it.

According to a recent Charles Schwab survey, 52% of respondents said their 401(k) investments were more confusing than their health care benefits.

Nearly half (46%) don't feel they know what their best investment options are and one-third (34%) feel a lot of stress over correctly investing their 401(k) money.

But as with most things in life, the more you know, the less you stress. Here's what you need to know to make your 401k, IRA or other retirement plan a lot less stressful.

First, understand that while you may have a ton of investment choices in your plan, they typically boil down to only three: Stocks, which are often labeled "growth." Bonds, often labeled "income." And cash, often labeled as money market.

How do you know how much to put in each? Here's a simple rule of thumb. Subtract your age from 100. That's the max you should have in stocks. So if you're 20, you'd have up to 80% in stocks. But if you're 70, you'd only have 30%. And if you're nervous, reduce those percentages| it's just a rule of thumb.

What's not in stocks can be equally divided between bonds, or income funds and maybe cash, or money market.

Another thing that's super important: Low expenses. To get your lowest expenses, look for index funds. Those are the mutual funds that invest in stock indexes, like the S&P 500.

You can also use funds that might do some of the work for you, like target date funds. So do a little more research, and you might come up with something you like better.

But at least now you've got quick, simple strategy that might reduce your investment stress.

Want more quick tips to help you invest wisely? Visit and do a search for "investing."

For Money Talks News, I'm Stacy Johnson.