How much (percent) of my income should I invest in my 401K? I just graduated college and I'm sadly ignorant.

I need to figure out how much income to contribute to my company's 401 (k).

Also, how to invest these savings between:
State Street Government Money Market Fund,
State Street Life Solutions Income & Growth Fund, State Street Life Solutions Growth Fund,
State Street S&P 500 Index Fund,
Fidelity Advisor Growth Opportunities Fund;
Putnam Advisor Growth Opportunities Fund;
Putnam OTC & Emerging Growth Fund
Janus Worldwide Fund.

What percentage (total must equal 100) should I allocate between these funds? Ideas and suggestions welcome.

First, congratulations on starting to save for your retirement. The benefits will be amazing.

The trick is time. The longer you contribute, the more dramatically your balance will increase. Contribution-wise, I believe your contributions are limited to no more than 16% of your gross income. Obviously, contribute as much as you can without it cutting into your debt and living expenses. One great thing about 401K contributions is that they are deducted pre-tax. That means you don't pay taxes on whatever you contribute until you withdraw it. You'll find your net pay won't go down by the same amount as your contribution. If you're in a higher tax bracket (like single), it'll have an even smaller effect. It's almost like contributing for free!

As for investing, I think the trick is to pick a balance of funds based on your investement goals. As a young person, you're much more interested in growth--increasing the value of your balance--than you are income--low-return but safe investments like bonds. So a good strategy is to put a larger percentage of your contributions into funds that are growth-oriented, like the Growth Funds you've listed. These have a higher risk short-term, but since you're investing long-term they tend to give you better returns overall. Plus remember this sage investment advice: no risk, no reward. The more you're willing to stick out your neck, the more you'll get back.

I'd consider a strategy using 60-80% of contributions in growth funds, with a small percentage of that in a higher-risk fund, and 20-40% in income or money funds. Just remember that you can change the percentages of future contributions pretty much at will depending on the kind of plan your employer has.

You should also check to see if the plan provider (Merrill Lynch, etc.) has some pre-configured investment models. You can then rely more on their professional direction to help you better plan.

Good luck--first one to a million wins!

If your company matches then you should invest at least the percentage that it matched. If you don't you are just throwing money away.

However, if you contribute the maximum (I think it's 15%, you will not feel the pain of trying to increase you contributions in your 30's and 40's. It will always be at the maximum.

As far as allocating--you will have to read about the type of investment each fund is. Since you're young you can afford to put more in higher risk funds. To be on the safe said, I'd say 70% in high risk, 10% in medium risk, 10% is low risk, and 10% in no risk.

You should contribute the maximum amount that you can toward your 401(k). It will probably be the bulk of your resources when you retire. We cannot tell if these are the only funds that your 401 manager offers to you. If so, then you don't have any additional options. These funds are not the best, as Putnam and Janus were both involved in financial mismanagement just a few years ago. You should do some research (www.morningstar.com) and on Forbes.com (look for the Lipper ratings) to learn about expenses, potential growth and risk of these (and other) funds.

You may want to contact the company that is handling the 401K accounts for the company you work for. Depending on whether you want to be aggressive in your investing or not, they will help you determine which funds to invest in and what percentages of your investments should go where.