Your question is part of a larger one — which is how well you are prepared to live through your retirement years. It’s not just about putting money INTO your 40l(k) plan — it’s now about choosing the investment funds inside the plan. I’m not quite sure who you spoke to at Fidelity — or if you have signed up for their retirement counseling services. That would involve telling them about your lifestyle and spending needs, your total savings (including money held outside your 40l(k) plan) and other financial issues.
I think this is the time to see a financial planner who is a FIDUCIARY — not out to sell you products and make commissions, but one who puts your interests first. Go to www.Wealthramp.com to search for a financial planner you can trust.
In the meantime, and more specifically to your question: Since you are no longer working at the company, you are eligible to do a DIRECT ROLLOVER from your 40l(k) into an IRA Rollover account — right at Fidelity. The reason for doing this is it will give you more investment choices than are typically in a company retirement plan. Without knowing much more about you — but hearing the concern in your post — I would suggest you do this immediately. And then tell them you want to put HALF of your money into a money market fund. You won’t earn much– but you won’t lose a penny! Put the other half into the Fidelity Equity-Income fund, which will give you some exposure to the stock market — some growth and some income. Sure it might go down in a bear market — but you’re likely to live another 30 years, and you need some stock market growth.
Doing a rollover is easy. There are absolutely no tax consequences if you let them do a direct rollover to an IRA from your 40l(k) account. Then, just be firm about how you want the money invested! If you have any problems, contact me.