5 things you should be doing to make the most of your 401(k)

If you are saving for retirement - and you should be - there's a good chance that money is going into a 401(k) plan.

The plans have become the primary vehicle for retirement saving in recent years, fueled by a decline in the number of pensions and uncertainty over the future funding of Social Security. But many workers never bother to fully understand their investment options or to take full advantage of the tools being offered by their employer.

Before you take a set-it-and-forget it approach with your 401(k) accounts (or continue with such an approach), it may be worth it to take a few steps to make sure you're on the right track and that you're not leaving any perks on the table. That includes making sure you are saving enough: Many advisers say workers should save up to 15 percent of pay, including any company match. And workers can contribute a maximum of $18,000 a year to a 401(k) or up to $24,000 if they are at least 50 years old.

Here is a checklist of sorts to help you make full use of your 401(k):

1. Know what tools are available

Many retirement plans offer tools online to help people figure out if they're saving enough and if they're investing appropriately. For instance, some savers who have workplace retirement plans with Vanguard may be able to answer a questionnaire that helps them figure out how much they may want to invest in stocks versus bonds, based on when they plan to retire, how long they expect to be in retirement and how they would react during periods of market volatility.

Many retirement plans also offer projection calculators that estimate how much income people might have in retirement, based on how much their saving, how their investments are allocated and when they plan to retire. For example, Fidelity has a planner that helps people estimate how much money they'll have in retirement. Vanguard offers a calculator that projects how long a person's savings will last, based on how much they're spending each year and how the savings are invested.

Crunching the numbers with the help of these tools can give you time to figure out if you should be saving more or if you might need to push back retirement. "Most people don't even know if they're on track," said Liz Davidson, chief executive of Financial Finesse and author of "What Your Financial Advisor Isn't Telling You." Working out the math can also help you figure out how your savings should be invested.

2. Understand your options - and use them wisely

The average 401(k) plan offers 26 funds, according to a report from BrightScope and the Investment Company Institute. Sorting through those funds can be overwhelming, but less so if you understand how they work. Generally, the line up will consist of a cash option, such as a money market fund, as well as stock funds, bond funds and balanced funds, which invest in both stocks and bonds.

Savers can use one fund, or a mix of funds, to create an investment portfolio. Those people who want to be active with their retirement accounts can decide how much of their savings they want to allocate to various types of stocks or bonds. However, people who don't want to put in the time to manage their portfolios can opt to use target-date funds, which invest in both stocks and bonds and rebalance automatically to become more conservative as a person approaches retirement. (Be careful not to put all of your savings in cash, which would force you to miss out on potential market returns over time.)

Savers who decide to use target-date funds should also know that they are meant to be an all-or-nothing deal, advisers say. Target-date funds are already designed to invest in a range of assets, including different types of stocks and bonds. So investors who put a portion of their savings into a separate fund invests only in stocks, for example, may lose track of how much of their total savings are invested in stocks.

3. Calculate your costs

Basically, the more money you spend on fees, the more those costs take away from your investment returns.

Still, few people pause to do the math on what they're paying or understand how the fees work. For comparison purposes, the average 401(k) plan charged 0.89 percent in total fees in 2013, or $89 for every $10,000 invested, according to the report by BrightScope and ICI. (Fees tend to be lower for larger plans, since administrative costs are spread out across more savers.)

Retirement plan fees are generally split into three categories: investment fees, administrative costs and service charges.

While administrative costs are usually baked in to other fees or paid by an employer, savers can lower investment fees by shopping for funds with low expense ratios. Those fund costs should be available online under the section that lets you compare your fund options. Expense ratios are generally shown as a percentage of the assets invested. For instance, a stock index fund may have an expense ratio of 0.15 percent, or $15 for every $10,000 invested.

4. Check in every year

Once the account is set up and the savings are spread out across various investments, savers should check in on their accounts once a quarter or at least once a year to make sure their money is still invested where they want it to be. This is especially true for people going the DIY route, says Neil Gilfedder, vice president of portfolio management at Financial Engines, a registered investment adviser.

Wild market movements throughout the year may leave you holding too much, or too little, of a particular asset class, he says. Say someone goes from holding 85 percent of their portfolio in stocks to holding 80 percent in stocks. He would need to sell some other investments to buy more stocks and reach his target allocation. But avoid making changes to your target allocation because of what's happening in the market, Gilfedder says. Rebalancing should be about sticking to your long-term plan, not about changing the plan or trying to time the market when the market become more volatile.

Even people using target-date funds should review their allocations occasionally to be sure it matches their risk tolerance. Some people who expect to retire by a specific year may feel that the target-date fund aimed for that year holds too much, or too little, in stocks, Davidson said. They may want to switch to a fund that is designed for a slight later, or earlier retirement date.

5. Get advice

Your company may offer you the option of sitting down with a financial consultant who can help you figure out your risk tolerance and create a rough plan for how you should invest your savings.

Sometimes, the experts will be limited as to what kind of advice they may not be able to point you to one fund or another. But generally, the consultants can help you understand the different categories of funds and how risky they are.

"Take advantage of the fact that somebody will talk to you about what those particular investments are," says Lisa Bleier, who specializes in retirement and savings issues for the Securities Industry and Financial Markets Association, a trade group.

Some companies have the experts come visit the office on certain days and others offer the option to chat with someone online or on the phone. People who need more hand holding or guidance may want sit down with a financial planner or adviser who can help them decide between specific investments. But before making the appointment, it may be worth asking your human resources department about what resources are already available.