Most likely, you have not paid much attention to your company 401(k) retirement plan account over the last few years. Honestly, why should you?
All-time high stock market highs have been the norm. Every month, the combination of your payroll contributions and the company-matching contributions made for you, have resulted in record company 401(k) retirement plan balances.
Congratulations. In a rising stock market, you are a great company 401(k) retirement plan investment manager. Even when you are not paying attention.
Now what are you going to do going forward to preserve your all-time company 401(k) retirement plan account balance?
When, the stock market fall, and takes your retirement savings down with it, who are you going to blame?
You need to make your company 401(k) retirement plan principal preservation strategies clear right now. How much money, in dollars or percentages, are you willing to lose from your all-time company 401(k) retirement plan highs over the next few weeks and months?
The preservation of your company 401(k) retirement plan account balance is your responsibility. Not the stock market, Federal Reserve, the mutual funds you own, or the co-worker you can’t stand.
No excuses. It’s on you.
For too long, individual stock and bond market investors have had the mindset that their investment management success or failure is caused by external forces.
You can have that kind of mindset, and not pay attention to your company 401(k) retirement plan account, when the stock market only goes up.
News flash. The stock markets are no longer supporting higher prices. Your mutual fund manager and company 401(k) retirement plan provider is not going to step in and preserve your retirement savings.
You can’t rely on anyone else to watch your company 401(k) account. You need to have a principal preservation plan in place now.
Set mental and emotional stop losses based upon your most recent statement company 401(k) retirement plan account levels. Accept final responsibility to preserve your retirement plan savings.
The only person who cares about the preservation of your company 401(k) retirement plan account balance is you. You can control your investment management success or failure that results from the next great stock market decline.
Don’t waste any mental or emotional energy hoping your company 401(k) retirement plan account balance will not drop dramatically. Or worrying what will happen when it does. Again.
Be proactive. Make your common sense decisions right now. How many more stock market losses you are willing to accept before you find the safety of the money market account with a meaningful portion of your company 401(k) retirement savings?
Ric Lager
Lager & Company, Inc.
