Johnny, Lester, & the 401k

“Corporate Thuggin”- Section8Investor 

Johnny is 21 and is new to his company. The company he works for is called, “Benjamin Guapo LLC”. He’s new, experienced, and has no knowledge on what a 401k is. When asked by his employer to open a 401k he was skeptical because he didn’t think it was a good idea and he heard nothing but horror stories of the stock market and stated he would rather keep it in his regular bank account. He thought it was a complete scam and a game for the criminals. Once he turned down the 401k offer his employer only offered him to think about it and take a couple finance courses they offer around the city.

The following day Johnny was out with a coworker by the name of Sunny Lester. Sunny is also with the firm and has been since 1974. During lunch that evening Johnny asked a serious question. Sunny said, “well young man what is your question”? Johnny asked,”Sunny are you invested in the 401k scam and if so how many years have you been trapped”? Mr. Lester laughed immediately after he heard the question and said, “lad you remind me of myself when I was your age and boy do I regret it”. Sunny gladly discussed his share on the Companies 401K. He told the truth, bad, and the ugly.

Like stated before, Lester joined the company in 1974 at the same age of 21 as Johnny. Mr. Lester admitted to not investing until he was 40 because he was unaware of Compound Interest and the free money it offered with the 5 perfect match. Johnny politely stopped and said, “Compound Interest, what’s that Sunny”? Once again Lester laughed and was so astonished at how so much Johnny reminded him of himself back in 74′.

He gladly explained to little Johnny how Compound Interest works & the whole nine. He even showed Johnny his portfolio with inclusive tips and tricks, but he also told Johnny to be wise, diversify, and invest in what he knows. Taking it all in he didn’t understand the jargon and terminology but once he educated himself the following month he was well aware of the wonderful opportunities of the 401K and Compound Interest. He knew free money could be left on the table and didn’t want that to happened. It was a grab and go one of a kind deal!

That following month Johnny proudly walked in his employers office and demanded the 401k option. Well, well, well,”said bossman”, I see someone figured the beautiful invention of Compound Interest. What made you change your mind? Johnny answered,”a great friend”. Ever since then Johnny has been well invested, saving 15 percent of his income towards his 401k, taking advantage of tax breaks, and also free 5% match. Also, till this very day he still keeps in contact with his mentor/friend/coach Mr. Sunny “401k Legend” Lester.