Earlier this month of March, it was nine years since that last U.S. stock market bottom. Since then, “set-it-and-forget-it” has been the best company 401(k) retirement plan investment management strategy available.
Individual company 401(k) retirement plan participants have benefitted from the best of both possible investment worlds. The U.S. stock market reached record highs and U.S. interest rates fell to record lows.
The 2017 year-end all-time company 401(k) retirement plan account balances also included the last nine years of annual contributions from individual investors and their company retirement plan sponsors.
Until now.
Tariffs, investigations, Facebook, porn stars, trade wars, China, etc. Interest rates have risen dramatically from their 2017 lows. And now the stock market seems to have gotten sick.
When was the last time you reviewed the mutual funds you own in your company 401(k) retirement plan account? Nine years is a long time to not pay any attention.
Use the current stock market weakness to take more control over your company 401(k). This is a working career event for you to pivot away from older investment management strategies that may or may not work going forward.
The most important thing right now is not your past stock and bond market gains. Especially now, it is not about “buying the dip.”
Preserve the principal in your company 401(k) retirement plan account. Have a very good reason to expose your retirement assets to any stock or bond market risk going forward.
If you are a handful of years away from retirement, you have a very important investment management decision to make. You don’t have the time left in your working career to go through another historical round of company 401(k) retirement plan losses.
The last and most expensive company 401(k) stock market mistake for the current generation of individual investors was the stock market crash from October 2007 to March 2009. That event took almost 57% off the S&P 500 Index.
You don’t need to repeat your past 401(k) stock market mistakes.
Now is the time to really dig deep. Don’t over rationalize or over think. The stock and bond markets are not going to wait until you have more time.
Don’t wait for your March quarter-ending company 401(k) retirement plan statements to show up in early April. Go online now and view your current company 401(k) retirement plan account values.
How much of your current company 401(k) retirement plan account value are you willing to lose at this stage of your working career?
Ric Lager
Lager & Company, Inc.
