Red Flag 1: You Don’t Know Your Fund Expense Ratios
If you’ve never looked up your 401k fund expense ratios, you may be paying 10–40× more than necessary. Log in now and check. Above 0.5% for any actively managed fund warrants consideration of alternatives. Above 1.0% for any fund is almost certainly too expensive.
Red Flag 2: Your Balance Is Far Below Age Benchmarks
Fidelity benchmarks: 1× salary at 30, 3× at 40, 6× at 50. If you’re more than 30% below these targets, your current contribution rate isn’t enough. Run the calculator to determine what rate would close the gap by retirement.
Red Flag 3: You’re in a Money Market or Stable Value Fund at 35
A 35-year-old in a money market fund earns 2–4% when they should be earning 7–10% in equities. On $100,000, the 30-year difference between 3% and 7% return is $424,000 vs. $761,000 — a $337,000 loss from allocation alone.
Red Flag 4: You Have Multiple Old 401k Plans Left Behind
The average American has left $5,400 in orphaned 401k plans from past employers. These accounts may have high fees, investments that have drifted, and no attention. Consolidate all old plans into your current employer’s plan or a rollover IRA.
Red Flag 5: Your Contribution Hasn’t Increased in 3+ Years
If you’re earning more than you were 3 years ago but contributing the same percentage — congratulations, you’ve given yourself a raise. The contribution rate should ideally increase each year. If it hasn’t, enable auto-escalation today.
Contributing 6% of $55,000 in 2020: $3,300/year. Contributing the same 6% of $75,000 in 2025: $4,500/year. But contributing 10% of $75,000: $7,500/year. The stale-rate investor contributes $4,500; the rate-optimizer contributes $7,500. Over 25 years at 7%, that $3,000 annual gap = $204,000 in retirement wealth.
Red Flag Diagnostic Summary
401k red flag diagnostic and fix timeline
| Red Flag | Quick Check | Fix Time |
|---|---|---|
| Unknown expense ratios | Look up each fund on Morningstar or plan portal | 15 minutes |
| Below age benchmark | Run 401k calculator | 10 minutes to identify; months to fix contribution rate |
| Wrong allocation for age | Compare to target-date fund for retirement year | 30 minutes to switch funds |
| Old orphaned plans | Count your previous employers | 1 hour to initiate rollover |
| Stale contribution rate | Check what % you set at enrollment | 5 minutes to increase in portal |
Run Your 401k Health Check
Enter your current balance and contribution rate — see if you’re on track and where the biggest gaps are.