401k investment — getting nervous
Hi Terry, I'm 50yrs old -- Given the irratic behavior of the stock market lately, should I decrease the 9% amount taken out of my paycheck? Or just leave it alone and ride out this storm? Thanks.
Terry Says
Keep saving and keep contributing. BUT you might want to adjust your investments INSIDE the 40l(k) plan. You likely have a lot of profits if you've continued to invest on a regular basis over the years. Find the most conservative fund -- likely an "equity-income" fund and move some of your investments into that area. And if it is keeping you up at night, maybe transfer 10-15 percent of your account into the "stable value fund" that is available in most 40l9k) plans. But DO NOT HIDE IN A BOND FUND. When interest rates rise, bond prices fall. That means you can lose just as much money in a bond fund as in a stock fund!
