The 401K statement in the mailbox….

Well you may or may not have already gotten your 401k statement for the 4th qtr in your mailbox.  Are you dreading opening it?  Is it just sitting there and you can’t open it?  This goes back to doing what we most fear, get it behind us and work through whatever it is.  Well that time has come.  Go ahead and open it.  Now just don’t look at the negative balances or what you lost in 2008, let’s look at 2009 and beyond.  I am by no means an expert on stocks, mutual funds or 401k plans.  But I am going to give you my 2 cents, bare bones suggestion.  With your 401k statement you should also receive another sheet that shows plan results broken down by catagory.  It should give the qtr, the year, then probably 5 individual years going backwards, then 5yr total return and maybe even a 10yr and 15yr return columns.  I always looked at these and put a weighted system on each total, etc etc, I know I am a numbers geek.  What I am suggesting to you, is to look at 2008, it has been one of the worst for 401k’s in years.  We personally have in our 401K plan a stable fund that actually came back at a 4.60% return for 2008.  Positive returns in 2008?  Yes, there is probably one fund that you can look at that actually survived 2008.  When I evaluated the situation after qtr 1 of 2008 I threw a large percentage into it, still leaving some in other funds that were not losing money, well come second quarter, those were border line making money, I threw a bit more into the stable fund.  Come the 3rd qtr I threw it all into that stable fund and I now know there will be nothing I can do until this economy bus turns itself around.   So looking forward to 2009, will it be better than 2008?  All indications say no, and hopefully not worse than 2008.  So plan accordingly, know your risk aversion, actually take a look at your 401k information.  If you want, fax it over to me and I can help you sift through the numbers to help you understand a little more of how to read them.  Of course, I won’t tell you what to do, but I will explain what you are looking at so you can make the best decision for your situation.  We the little guy are not going to get a govt bailout like these large corps are, we need to help ourselves the best we can.  Buy, hold, and pray is not the order of the day nor is it for 2009, nor is ignoring your current plan mix.  Does anyone have a 401k plan that all choices in their plan lost money?

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~ by debt2dreams on January 20, 2009.

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