Ask Terry Questions 401k –what to do?

401k –what to do?

By Terry Savage on March 07, 2020 | Financial Planning / Retirement

hi terry, I am currently 50 years old and plan on retiring in 5 to6 years, my 401k dropped about 50,000 dollars in the last week, I have a very mixed portfolio with very little in stable value, do I just ride out this latest bump or move some money into a more stable investment? thanks In advance

Terry Says

I’m not sure how you plan to retire in your mid-50s — and I’m hoping that you have more than the $500,000 that reflects a roughly 11% drop in the market (your stated loss of $50,000) in the last week!
You need to work with a financial planner to come up with a realistic scenario for having enough money to retire. Or go to and use the “ballpark estimate” calculator to see how much you will fall short if you retire in your mid-fifties (unless you know you have a health condition that will dramatically shorten your life expectancy)!
To find a FIDUCIARY financial planner start at — a matching service for Certified Financial Planners that charge fees, not commissions and promise to put your interests first.

I know you want specific advice about investments, but you really need a much broader perspective about what retirement would cost. You should wait until full retirement age to take your SS — and that’s at least a decade away. And you should continue to contribute to your retirement plan in the coming years — by working until at least your full retirement age for SS, which is around 67.
This may be bitter advice, but better to do it right now — while you have time to deal with these issues — than waiting to become a “bag lady” or “street person” in your seventies. Maybe you’re not telling me about the rest of your fortune, which is in bank CDs or Treasury bills. If you have another million stashed in “chicken money” investments, then you can likely ride out the stock market because you won’t be forced to withdraw from your retirement account until age 72!

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