I wrote this article on September 9, 2011 on my Golden Valley Patch Blog.
In Minnesota, we don’t fool around with our health. Every year, our state ranks in the top handful of “healthiest states to live in.”
If we are sick, we go to the doctor. The doctor prescribes us the best medicine available based upon years of experience and study of available research. We then stop by the drug store to pick up our prescription, begin taking our medicine, and after a few days we get back to “feeling better.”
Can the same common sense approach work and improve once and for all the future investment performance in your company 401(k) retirement plan account?
Over the last four years, the stock market has been “sick” due to the downward cycle of the U.S. economy. For that reason, the mutual funds that buy and hold large U.S. company stocks have not performed well. In most company retirement plan menus, these large company mutual funds make up the majority of available retirement plan options.
With the stock markets going through historic volatility, now is the time to make a change in the “prescription” of how you manage your company retirement plan account.
In order to “get well” in your company retirement plan investment performance, you may need to begin to own the mutual funds that buy and hold small and mid-size companies. These mutual funds are described as the Small Cap and Mid Cap mutual fund options on your company retirement plan menu.
Also think about changing the mutual fund options where your future company retirement plan contributions will be invested. Again, more small and mid-sized companies should be included in your company retirement plan account holdings going forward.
In order to change the financial health of your company retirement plan, the best “prescription” now is to change the mutual funds you own going forward.
Ric Lager
Lager & Company, Inc
