The CEO of NerdWallet says there are a handful of common financial mistakes he sees young people make all of the time. (via CNBCMakeIt)
of more than 1 percent a year just for managing your 401 plan. Those fees can continue to add up even if you're no longer contributing to the plan.
"You're basically going to lose a percentage of your money," Chen says. "Think about how much that compounds to over time. What you should do is roll it over to, basically, a zero-cost IRA and save thousands and thousands of dollars over the course of your life by doing that." Even Chen wasn't immune to this financial mistake despite the fact that he has an economics degree from Stanford and he spent several years working for Wall Street hedge funds before founding NerdWallet in 2009, a site that sees 10 million monthly visitors and has beenat more than $500 million. Chen says he "had no idea" how common management fees for old 401 accounts were until years after he left the hedge fund business and checked his own statements.
"I went back and looked at the fees finally, and I was getting charged 2 percent a year just for leaving my money in my 401," he says.
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