My 401K has me really sick

This topic has really funked me out lately. Frustrated & fed up

What are we to do? Lock in our losses and sell? And move to guaranteed accounts till retirement and try to recoup maybe 30% of our total losses in next 10 years or stay put and have faith the economy will right itself. The nightly news seems to get worse each day with no problems solved.

Maybe I should consider myself fortunate to have a retirement plan in the works but at this rate the market has moved, just when you'd think it hit bottom, it falls another 2%. I really do not know what to do. For the sake of my family, I pray my patience pays off before 2014. I'm going all CD's my last 5 years before 58. My total retirement plan has shrunk more than I'd like to admit and I was only 70% equity which is somewhat low for a guy in mid 40's. (And all these years we listened to the genius's who told us how to invest)

How do others feel? What have you done? Have you changed your original plan till retirement or still on same path? Did you jump ship? Have you been & are you recession proofing yourself now?

The best thing to do now is do nothing. I'm in the same boat as you, Mark. My 401K has dropped to 1/2 what it was last year. It will build back up. Mine also dropped big time after 9/11, but it came back and then some. If I moved into safer funds at that time it never would have recovered the way it did, the same holds true now.

http://www.vanguard.com/

glad i never put any money away
at this point you are better off buying ammo and canning supplies and plan on a big garden next yr

Cap
I'm going to stay the coarse and continue contributing into my 401k. I will be buying Exxon Moble and Phillips Conaco stock when it bottoms out which is very soon. Does anyone really think its not going back up??? I'm looking at it like this. I''m buying dried up sponge, it aint worth much right now but when it starts to rain again its going to soak up that much more water and I'll recover that much sooner. DONT lock in your losses
Hang tough,
Steve

DONT lock in your losses

Now is the time to buy.

First of all....I'd rather be retiring in the next 10 years than in the last 10. The markets will rebound....the strong will survive and it appears the Fed will prop up the weak. 70% equities is too aggressive at any age for a substantial sum....60/40 will position you so that you have cash on hand for opportunities that come along. We're about to enter that opportunity zone soon.....maybe within a year or so. This has happened before...the "boom...bubble...bust" phenomenon. The auto industry in the beginning....electronics in the mid 20th century...dot.com and real estate most recently. This is when real money is made for those with patience and discipline and a strategy and with cash on hand because they were not "all in" during boom bubble bust cycle. If you go to cash now...at or near the bottom....you'll eventually want to get back in....and when?....when the next boom is entering the bubble stage just before the bust. See a pattern here? It's exactlt opposite of Econ 101...buy low/sell high.....When you're getting out the real money is getting in......When you're getting back in you're buying the inflated shares of those who are getting out before the bust....those with patience and a strategy. Start reading....begin with Warren Buffet and his partner Charlie Munger....you can read the annual report of their company Berkshire Hathaway on line. Remember the phrase....be fearful when others are greedy and be greedy when others are fearful.
Enough rambling for one night....

Cap
At this point i'd hang in there, at some point the markets will hit bottom and start to correct. Keeps buying now that it's low and those shares will give you a better return on the up swing. I moved my IRA out of the market and into a money market account back in June, with oil rising and the housing crashing I felt it was going to get lot worse before it got better, for once I was right. Of course my finacial advisor was against it, a money market account only gives you 3%, but a 3% gain is better than 30-40% losses. You have to remember most of these guys don't give a rats a** about you or your money only their commisisons . I learned that back in the dot com bust, I wanted to move my money and he kept telling me to " ride it out", that little ride cost me 50% back

You have to keep a close eye on the economy and what's going on around the world, yes the advisors are supposed to do this for you but most don't. When you're close to retirement you should have very little tied to the stock market. Remember, it's your money you can move it anytime you want, usually there's no charges as long as you're still within the same company.

Dave

I would not advice anyone to buy individual stocks unless you have a stomach for volatility and the time to watch your investment. The average investor is much better buying mutual funds. They don't have the volatility of an individual stock so you're not going to wake up one morning and be down 25% or worse. I've seen it too many times. With mutual funds you can still buy any sector you want. I also wouldn't sell right now because there are billions of dollars on the side lines waiting to be put back into the market. When this market rallies (not a suckers rally) you'll see 25-30% in 1-2 weeks. We are close to a bottom for sure and may trade in a range right now. Be patient. The smart money buy when people are panicking and sells when there is too much euphoria.

Statistics have shown that after the market hits near bottom, within a few years, it rises up again and surpasses the highs. Look at what happened after 9/11. The market is just about as low right now as it was was then. I have faith that the market will regain all of it's losses within four years. I'm a government employee and contribute to the Thrift Savings Plan (TSP) which is a combination of stocks and bonds. http://www.tsp.gov/forms/comparison.pdf This is our 401k. Every two weeks 16% of my wages go into the TSP. It seems a lot but we can live on what my take home is. I'll be eligable to retire at age 54, but I plan on retiring at 57 or 58. That's another 19 years from now, so I'm in for the long haul. The good thing about this is that every two weeks, I'm buying low. Hang in there guys. It'll get better.

Your averaging down which is a good investment strategy.

Ok, we have a lot of really confident investors on this board which have faith in our leaders and Wall St. But whenever our leaders speak, the market dives. It's like the Great Oz speaking to us munchkins. And another really bad day in the market. Do you really think we hit bottom? We only reached yr 2003 today. Maybe we go back another 5yrs over the next 6 months? I'm still in. I haven't sold a nickel's worth of my long term investments but I beginning ( and have been ) to think, this ain't right. It may only get worse, I mean real bad. This economy just ain't right. The way we are fleeced just ain't right.

We ( the working man ) have never lived through what is happening now and I for one fear what will come of it all. We've been robbed by the smartest people on the planet, white collar criminals. I don't see one indication that this entire mess will ever straighten itself out no matter how hard Oz makes us belief he can fix it. It's gonna take something really big, something that we can all contribute to & use. Something that will create new jobs, new money and a new way of thinking about how we survive as a country.

When the shorts get tired of taking the market down they will go long again. The news will be that the stimulus packages are starting to grow legs. Who knows how low it can go. There are forecasting 6500 or worse if we see the economy worsening. When there is a turn around it will be very strong and we'll see 15-20% in a few days. This is a hard lesson to everyone not to be too heavily invested in stocks. We dumped our money into 401k's and watched it grow and became lazy. The pros on Wallstreet are laughing all the way to the bank as they steal everyone's retirement. It's not fait but it's life.

Guess who made lots of money during the depression, the folks who had the ability to buy from all the sellers who were panicking. I wish I was more fluid because I think now is the time to buy on a massive scale and someone was right, mutual funds are the way to go unless you have the time to really study the market and hope the accounting published on these corporations is accurate. One of the guys was talking about laddering cd's. If you are talking small amounts of money, why not, but if it is a larger sum, you get no tax advantages in this way. Hell, I'd get a fixed annuity for 5 - 7 years before I would buy cd's, especially with deflation on the horizon. Wait to see what the cd's offer in a month from now with deflation of 2 - 3%. I bumped up my retirement investing becasue I think we will come out of this in a couple of years, and by bumping up my investments now I am lowering my cost basis.

I'm out totally, once the government put a couple of hundred billion in and the market did a nice bounce I pulled everything out, that was months ago(Last I heard it was up to 2 trillion). I hope that some will again get lucky and catch a bounce and get out with only a small loss or no loss. As far as it going back up to where it was no way no how for 20 or 30 yrs. They are going to change so many laws and make so many people pay the piper for this one that it will take only actual investments into the market to make it climb. hedge funds, longs and shorts man are they going to get buckled down to the point that it will not matter if someone bails out as it did this time. Most investment houses now are banks and are regulated much differently. (The ones saying to stay in are the ones that only get paid out of your accounts. Something to think about.)

20 or 30 years. I don't think so. Once good news starts to prevail a recovery will occur and the market will race to 10k. People said we would never see oil below 100.00 and now they are saying 40.00 oil is a possibility. I think it may take 2-3 years but once Obama gets into office and if he gets us out of Iraq and starts creating jobs the doom and gloom will go away and billions of dollars will pour into the market. I called the bubble bursting in oil and I'm calling a recovery in less than 2 years. We will see a bottom and then build from there. Once a bottom is reached the market will have a short explosion on the up side. Wait and see.