Comments on: I'm losing money in my 401k – Whoa!

By: Rob

Rob — Sun, 09 Nov 2008 09:18:58 +0000

My 401k has dropped over 40 percent since September. Never seen it this low! Even though I’m losing sleep over it, I’ve decided to ride out the storm and hope for the best.

By: Market Guru

Market Guru — Wed, 15 Oct 2008 21:23:28 +0000

When we talk about pulling money out of the 401k does not mean cash out your 401k account. We are merely suggesting you move your 401k investments to more conservative choices such as money market, stable value funds, bonds etc. Therefore, there won’t be any change in tax deferred status.

If you are going to gamble on the stock market in a tough economy, it is better to do it outside your 401k, in a cash account, so that if you loose money, you can deduct such losses from income in your tax return.

401k tends to hold a major portion of your net worth and it is not a vise idea to put it to risk.

There are extended market cycles where stocks remain depressed for 20, 30 years. Buy and hold does not always apply. Try to understand that stock market is a game where you are at a disadvantage. It is going to redistribute wealth and bigger share will go to those who are savvy investors, not you and me.

Please study technical analysis and protect your 401k. History shows buy and hold does not work. Look at 20th century price chart and make objective decisions. Do not follow what is in your heart. Accept the fact that we are no different than the generations who saw the stock market trade side ways for 20 years, 30 years. It can happen to us as well.

By: glblguy

glblguy — Mon, 13 Oct 2008 10:36:28 +0000

@Sam – Hi Sam. Thank you, glad you like it! I don’t think that is possible since your 401k value is based on the stocks that you own. Unless those stocks go to zero, your 401k balance could never go to zero. We’ve all lost large percentage, but I’m hoping the market begins to level out soon.

By: Sam

Sam — Mon, 13 Oct 2008 04:44:58 +0000

Thanks for this great blog site!!

What happens when you keep losing 401 money to a zero balance, IM losing fast! Is that the end of my money and do I have to put more money into it again?

Thanks for any advise!!

By: Jen

Jen — Sun, 12 Oct 2008 03:04:23 +0000

I’ve been watching my IRA religiously because I’d just moved it from a conservative porfolio to Fidelity’s freedom 2050 or something like that, it is more diverse and more risky. I am 25 and was just starting to get serious about what to do with the IRA my job had started (working for UCLA). But since the decline, i’ve lost 30% of my funds in the past weeks! Definitely not taking any out, but want to know how much I should put in and how does it buy more stock?

By: glblguy

glblguy — Fri, 10 Oct 2008 09:33:00 +0000

@SeattleDave – OR more likely we’ll be sitting together in Cancun sipping fruity drinks and talking about what flavor we’ll drink tomorrow

By: SeattleDave

SeattleDave — Fri, 10 Oct 2008 04:27:23 +0000

My 401k is down about 50k in the last 10 months, and it SUCKS to watch. At this point what can I do? Nothing. If I withdraw, I lose, If I move around, I dont buy as much stock..either way I have no choice but to ride it out and hope it bounces back. If not, we’ll all be on welfare together in 30 years

By: MITBeta @ Don't Feed The Alligators

MITBeta @ Don't Feed The Alligators — Mon, 15 Sep 2008 11:48:57 +0000

@ Joe:

You’re “market timing” with this strategy and will miss a good deal of gains with it. By the time you decide our “economy is heading to a bullish market” you will have already missed substantial gains.

Good luck with that…

By: Joe from LA

Joe from LA — Mon, 15 Sep 2008 07:15:03 +0000

Good thing that our 401K is online, where I can move around my portfolio. I don’t know if its a good thing, but currently my assets are moved from a diversified portfolio to a more “low risker”. I just have to remind myself (check every month in the website) that once our economy is heading to a bullish market, I have to re-balance my portofolio to where it was prior to our slow economy. So instead of anticipating a loss of 5% to 15% on mid to high risker stocks, I moved them to say a more stable +2% on bonds. I would rather see the 2% gain than predictable loss of 10%. Im not going to sit and watch my 401K lose up to 15% of my invested money every 3 month statement…

By: Investing Carnival #11 — Old School Value

Investing Carnival #11 — Old School Value — Tue, 09 Sep 2008 14:40:24 +0000

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