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Getting and reading the quarterly 401k account statements used to be quite a joyful event. The numbers keep going up, the row that says Market Value Change is always positive and my grin always get bigger.
This year however, it’s a little different.
With the downturn of the stock market, the value of my 401k account really tanked. In fact, my statement says that I lost $-5,112.08 year to date, which is roughly 12% of my entire account! I already tried to pick the funds with the least amount of fees, but my funds in the 401k will still take an average of 1.2% of my money this year. Normally, I try not to pay attention to this since I don’t have much of a choice with my limited 401k selection but it is particularly frustrating when it seems like I’m paying someone to lose my money. (One note to self: When I gain control of the money in my 401k, remember to pick funds with low expense ratios)
Currently, my allocation is:
BlackRock S&P 500 Index Fund - 40%
Blackock Large Cap Growth Fund - 25%
Goldman Sachs Mid Cap Value Fund - 10%
Thornburg International Value Fund - 25%
The performance hasn’t been good but I don’t plan to adjust it now that it’s down so much. I plan to keep investing through thick or thin which is key to wealth building because the stock market can turn positive all of a sudden.
When that day comes, we will all welcome the 401k statement in the mail again.
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{ 4 comments… read them below or add one }
While it is a bit disheartening to see your balance go down- that’s the price for investing in stocks! The good new is that as long as you don’t need the money, and have many years until retirement you should celebrate a market down turn because you get to buy shares at a much cheaper price. Don’t look at the balance for a while, but when the market eventually turns around you will be glad you stayed invested and continued contributing!
-Rick Francis
Rick: You are definitely right
I just wished I could cash out since I’m going full time blogging so I probably will hold off on contributing to my 401k until further notice!
My 401(k) has went WAYYY down but I have to keep in mind it’s a long-term investment. I try not to look to much at it and let my manager… manage it. Whether that is being retro-active or not it’s the best way for me.
Scot: Don’t worry if it’s long term. It will go back up