Podcast
401k Investing for Newbies and Nerds
Hosted by george l. morgan · EN
There are one hundred and thirty million American workers who collectively own $35 trillion in their 401k and related retirement accounts. The owners of these accounts face both challenges and opportunities. The largest opportunity is that their accounts are investment accounts, not savings accounts, and for the past three decades they have grown in the low double-digit range.
The main challenge 401k owners face is that there are required to make their own investment decisions by choosing from a limited menu of mutual funds.
These 130 million self-directed retirement account owners can be divided into 3 distinct categories. The first are those who could care less about their money and are willing to just let nature take its course. The second group, NEWBIES, are inexperienced in the investment process, but are willing to become engaged in the management of their hard earned dollars. The third group, NERDS, are those who have a modicum of investment expertise and are willing to devote the time and energy to expand their investments skills.
The mission of my podcast is to motivate and educate 401k NEWBIES and NERDS on how to optimize their 401k experience. I have a 62-year relationship with the stock market. I have been a stockbroker, finance professor and individual investor. Ten years ago, I appointed myself to the position of 401k guru extraordinaire. I have no investment products to sell. All I have to offer are the objective observations of one who has been there and done that.
16episodes
Episodes
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Season 2 Episode 8 A Billion Here, A Billion There
2w ago00:32:53Tap to summarizeSend us Fan MailDuring a 1963 debate on the federal budget, the Senior Senator from Illinois, Everett Dirksen proclaimed, “a billion here, a billion there, and pretty soon it starts to add up to real money.” Dirksen didn't use exact numbers, and that was not his intent. He used hyperbole to point out that the proposed level of federal spending would have significant impact on the lives of the American public.The same thing can be said about the current state of our nation’s 401k program: “It is starting to add up to real money.” As it was in Dirkson’s case, the numbers I am about to present are not precise, but because of the massive dollar amount involved, lack of specificity does not diminish the significant role our 401k plan plays in the lives those living out their golden years.The 401k program became the law of the land in 1978. It allows workers to place a portion of their paycheck into a tax sheltered account that will become their primary income source once they retire. The growth of an individual 401k account has two distinct components. First, there is the additional dollars being added from the participants payroll deductions. Next is the growth of the investments selected by the account’s owner. The program requires the account owner to decide how the assets of the account are invested, but their choices are limited to a small number of mutual funds provided by their plan administrator. When we entered the twenty-fist century the total value of the 401k program was $1.7 trillion. During the years from 2000 to 2026, the S&P 500 index grew 4 and a half times. Sevent-six percent of all 401k accounts contain equity mutual funds and as we entered 2026 the total value of the 401k assets exceeded $14 trillion. It is impossible to calculate what percent of this impressive growth in 401k assets can be attributed to payroll deductions and how much to invest gain. But let’s assume that the gain from the investment portion is a meager 25 percent of the total. That translates to $3.5 trillion added to workers retirement accounts due to prudent investing. Support the show
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Season 2 Episode 7 Gen X 10, Wall Street Techies Zip
4w ago00:35:05Tap to summarizeSend us Fan MailWhen I was a kid, our family car had air conditioning, It was a little triangular shaped window that you flipped around and it blew air on your face. Our family car also had power windows. There was a crank on the door and you were the power. Fact checking involved going to the library and digging through 28 volumes of the Encyclopedia Britanica. But that was then and this is now. My grandkids can’t get out of bed without checking their cell phone. Technology is everywhere and more is on the way in the form of the newfangled AI contraption.Not to be left in the dust, the marketing mental giants of Wall Street have decided to jump on the AI bandwagon. A recent article in the Wall Street Journal outlined how the legacy Wall Street banks are using AI to create NEW investment strategies for the wealthiest clients? Oh, and by the way, it is Wall Street's favorite new way of making money. The WSJ article quoted the managing director of one of the new hi-tech as saying, “Portfolio managers and financial analysts cost money and get bonuses. Computers don’t.” Before you run out and bet the farm on the latest and greatest new AI technology, let me point out to you that we've been down this road before, and we learned a long time ago that this dog don't hunt. One issue the WSJ article didn’t address was how well these snake oil computer programs perform. To quote Groucho Marx, they're like an ugly stripper: They want to reveal as little as possible.” Because these new funds are nothing more than renamed hedge funds with bigger computers, we can sneak behind the curtain for a glance at how they may perform. Last year, 20% of all of the nation's hedge funds declared bankruptcy and went out of business. To prove to you that the more things change, the more things stay the same, let me tell you the story of the 25 million Gen Xers who, on average, have amassed $583,800 in their 401k by doing simply, non-technical things. They bought low cost index funds, ignored the Wall Street mavins jibber jabber and just hung on to them for more than a decade. Index funds are the 401k investment equivalent to the triangular air conditioning window on my family’s 1949 Ford. Support the show
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Season 2 Episode 6 An Interview with a level 10 401k Nerd
Apr 1600:30:28Tap to summarizeSend us Fan MailIn this episode I spent time with Jake Olsen talking about his 401k experiences. Jake is a millennial and a Level 10 401k Nerd. I have known Jake for over 15 years. When we first met, Jake was a college student majoring in accounting & finance. Following graduation, he took a job in the finance department of a local Fortune 500 company. During his time there, Jake studied for and completed the Chartered Financial Analyst program.8 years ago, Jake left the Fortune 500 world and became a co-director at a consulting firm whose mission is to help CEOs at small to mid-sized companies grow their businesses by tying together the key components of financial planning, budgeting, performance analytics, strategy management, and deal management.Jake has 15 years’ experience in managing his own 401k. One with a large corporation and one where he was able to provide input. I found the time I spent with him constructive and informative. One issue in particular I found insightful was his perspective of the value of academic training when applied to the real world.I am sure you will find his responses to my questions enlightening, and hopefully they will open some new doors in your world. Support the show
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Season 2 Episode 5 New Menu Items Coming to a 401k Near You
Apr 200:34:58Tap to summarizeSend us Fan MailIn August of 2025, President Trump sign an executive order directing the Department of Labor to investigate how to include private equity and cryptocurrency on the investment menu of the nation’s 75,432 401k plans. There are a number of significant obstacles to this directive. The first biggie is how to do 401k plan participants get access to these non-exchange traded alternative investments? The second significant obstacle to Trump’s plan is the Supreme Court’s Tibble vs Edison decision which ruled that employers must provide their 401k employees with reasonable priced mutual funds or compensate them for their losses. What followed was a decade of lawsuits the lined the coffer of the plaintiffs’ lawyers and resulted in a push to include low-cost index funds in every 401k menu. This week, Trump’s quest to included alternate investments in all the nations 401k plans reached lift off status when the WSJ carried an op ed piece written by the Secretary of Labor. She declared that her department was moving ahead with regulations that would allow the inclusion of alternative investments in 401k mutual fund menus and they were carving out regulations that would protect employers from lawsuits involving excessive fees restrictions set forth in the Tibble vs Edison decision. In this episode of my podcast, I will provide further details on this issue, beginning with a brief history of how we got to this point. I will also examine how the financial service industry could manufacture products that allow 401k investors access to “alternative investments.” I will conclude with my thoughts on how newbies and nerds should react to this developing situation. Support the show
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Season 2 Episode 4 401k Investing for Newbies and Nerds
Mar 1900:32:35Tap to summarizeSend us Fan MailI have been meandering through the wonderful world of investing for over six decades. My main takeaway from these many years of market experience is that change is constant, and if you don’t embrace every new permutation along the way, you will wither on the vine. When I started my investing journey, things were formal, orderly and predictable. Trades were made by men in blue coats, standing on the floor of a cavernous building in lower Manhattan. Brokers wore dark suits, white shirts and fancy ties. They viewed themselves as investing demigods with powers that placed them on a pedestal high above mere mortals. Because of their unmatched financial powers, they expected big bucks whenever they stooped down to talk with the hoy palloi.Today, tens of billions of trades are made by incredibly fast computers scattered randomly across the country. Members of the financial services industry are not viewed with the same reverence they were back in the day, and they dress more casually than the local TV weatherman. The most dramatic change between then and now is the tens of trillions of dollars the American public has amassed in their 401k plans. Following on the heels of this development is the shift of the responsibility for the management of these assts from the Wall Street professionals to the lowly, unwashed commoners living on Main Street. The mission of my investment education enterprise is to train the 90 million 401k owners how to optimize their investing experience. I use the word optimized, not maximize, because investing is not a one size fits all proposition. Some are happy with allowing Wall Street to handle their stuff and pay big bucks for subpar returns. Others are engaged in the investment process and expect an enhanced gain in return.My initial effort in this endeavor was titled “Wall Street for Dummies”, but I have come to the realization that titles and key words are critical in attracting viewers. Therefore, I am in the process of changing the name of my podcast and website to more accurately reflect my message. In this episode I will outline my 401k investing 2.0 program. This is not a left turn or a 180 turn around. It is more akin to moving from a shot gun to a rifle. At some point in the near term, you will need to look for me under the title “401k Investing for Newbies and Nerds.” Support the show
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Season 2 Episode 3 The Rockets' Red Glare and Your 401k
Mar 1000:33:27Tap to summarizeSend us Fan MailA week ago, the skies over the Middle East were filled with more rockets than Times Square on New Year’s Eve. The following Monday morning, the Wall Street Journal opined that there would be a massive response on Wall Street to the Middle East missile fusillade. The inference from these reports was that Wall Street’s response would come from a bunch of rocket scientist wanabes, sitting in a windowless room, computers humming softly in the background, calculating the financial impact of the rockets flying in the Middle East. (Note the incredibly clever way I have tied rockets in the Middle East to rocket scientists on Wall Street). In the midst of all of this massive sell off jibber jabber, inquiring minds have to ask, “Who’s selling what and why?” A short answer is not rocket scientists. If it were rocket scientists they would calculate the potential reduction of oil flowing from the Middle East, divide that number by its impact on the following quarters GDP, adjust it for change in both the CPI and wholesale price index, then factor in the impact that the increase in the increase of the price of oil would have on the cost of delivering goods, adjusted by the Fed’s projected response in their commercial lending rates to make the cost of capital appropriate for this current position in the business cycle.In this incredibly insightful episode of my podcast I will explore what really transpired and address how the 90 million American workers with a 401k can use this as a learning experience and at the same time make a couple of bucks that they can send in their golden years to spoiling their grand kids. Support the show
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Season 2 Episode 2 All That Glitters Is not Gold
Feb 1100:33:54Tap to summarizeSend us Fan MailDuring my second junior year in college, I took a Shakespeare class. I was a business major and wore a coat and tie to class. In a roomful of liberal arts majors, it was obvious that I was the class nerd. The only line I can remember from the lectures was, “All that glitters is not gold.” Full disclosure: I had to Google “Shakespeare” to make sure I had the proper quote. It comes from the Merchant of Venice and is a warning against being misled by outward appearances. But getting back to Shakespeare’s all that glitters is not gold thing. There are 8,314 mutual funds available to the investment public. In calendar 2025, just 11% of these 8,314 mutual funds beat the market. Their average gain was 13.5%, barely half the 25.7% total return of the market. Which begs the question? What is the market? The gold standard for the market is the S&P 500 and the benchmark most quote by the financial media. It consists of 500 publicly traded companies selected by a committee hired by the index’s owner, Stand and Poors. It is the most comprehensive of the major indexes and includes 92 percent of all publicly traded companies. Of the 8,314 mutual funds produced by Wall Street, 73 percent are actively managed funds, which means that they have a professional manager who trades the stocks in the fund’s portfolio in order to increase its performance. The remaining 27 percent are passive index funds whose object is to mimic the performance of a specific market index. Index funds don’t trade in order to enhance their performance thus eliminate all trading cost and the expense of a fund manager.In 2025, only 914 of all the mutual funds equaled or beat the market. Of that 914, 177 were index funds who mimic the S&P 500. Of the remaining 737 funds, only 112 made the high-performance list in 2024. All 77 S&P 500 funds were on the winners list in 2024, and the year before and the year before, and so on. A 401k account is an investment account not a savings account. But investing is not a one size fits all proposition. Those who manage their 401k who manage their 401k wisely will get the gold. Those who take a casual approach to the management of their 401k will end up with shiny pyrite, also known as fools’ gold. Support the show
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Season 2 Episode 1 Your 401k, The Gift That Keeps on Giving
Jan 1600:34:39Tap to summarizeSend us Fan MailThe American economic engine is the greatest wealth producing machine the world has ever known. At the turn of the 20th century, it produced $4 billion in revenue for the American people. Last year it produced $30 trillion: A 4,000 percent increase. In 1900, a handful of individuals, known as robber barons, owned 70% of the nation’s assets. In 1950, less than 3% of the American population owned stocks. Today, 60 percent of American families own stock and 73 percent of the national wealth. We can attribute the growth of the American economic engine to our capitalist system and the ingenuity and determination of the American people. The shift in the ownership of its output came about in 1975 with the introduction of the 401k program. The acronym, 401k comes from a section in the tax code which allows workers to deduct a portion of their wages and invest it in a tax-sheltered account, to be used later, in their retirement years. The magnitude and importance of today’s 401k program is staggering. There are over 90 million plan participants, who own a total of $12 trillion in assets. In addition to this, there has been another 30 million Americans who have retired and rolled their assets over into an IRA, bringing the total value of the program to over $35 trillion. This is a figure 15 percent larger than the current Gross Domestic Product. And last year, these assets produced $1.5 trillion in additional wealth because their owners had the forethought and discipline to forego instant gratification and the dedication to wisely manage their 401k. Support the show
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Season 1 Episode 28 Who's Been Naughty and Who's Been Nice
Dec 2900:22:30Tap to summarizeSend us Fan MailTis the season where we titillate our naïve young people with the story of a mystical elderly gentleman who rewards his followers with gifts, the quality of which is based on their year-to-date behavior. An argument can be made that Mr. Market rewards his followers in a similar fashion. The mission of this episode of my podcast is to provide you with some perspective on how Mr. Market treated his followers in the year 2025. As you listen to this, I respectfully request that you keep the following in mind. First, investing is not a one size fits all proposition. Every investor comes to the table with unique objectives, skill sets, and service provider. Secondly, my remarks are aimed at the 90 million 401(k) participants who are required to manage their own account, but are limited to a menu of mutual funds provided by their employer. I want to close with a major caveat. Keep in mind that Mr. Market is a composite of many investors, each of which brings their own perspective and skill set to the table. Consequently, in the short-term Mr. Markets activity is random and unpredictable. In this context I asked that you enter 2026 with an open and flexible perspective and do not consider what I have said about 2025 in any way shape or form as a prediction to how 2026 will unfold. Support the show
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Season1 Episode 27 The Wizard of Oz and Your 401(k)
Dec 1700:35:37Tap to summarizeSend us Fan MailThe Wizard of Oz is about a Kansas farm girl who is traveling along a yellow brick road to get to the City of Oz, home to a person with special powers whom she believes can solve all her problems. Along the way she finds some odd characters who are seeking a heart, a mind and courage. When they arrive in the presence of supposedly omnipotent Wizard of Oz, they pull back the curtain to discover that he is just an ordinary man from Omaha, Nebraska, using mechanical trickery to conceal his real self. There is a parallel between the Wizard of Oz and your 401(k). For decades Wall Street professionals have used vocabulary to create an illusion of investment superiority. But the curtain that hid Wall Street’s truth has been pulled back and their deception has been revealed. Millions of ordinary investors have discovered that through the use of the unique features of a 401(k) and index funds, they already have the skills they need to outperform the pros. In this insightful episode of my podcast, I will explore many of the vocabulary terms Wall Street types use to distinguish themselves from ordinary strap hangers like you and I. Support the show
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