401K blues

[red]

I just about cried last night when I got my 401K statement in the mail. Mine lost over $12,000 last year alone. Now I know to some that might not be a big deal but since I'm not working I don't add anymore to it.
Anyone else get depressing news on theirs that they care to share? I'm sure Knabe is right on top of his & rolling in the big bucks. 

Red

 

[knabe]

i didn't do too poorly.  i can tell you i am going more with my decisions now that over and over, financial institutions have failed, why they rake in their bonuses and give us losses.

when the market was at 14,000, i took half my stocks and put it in cd's at 5%, now they are in cd's at 4%, so i did lose money as i left the balance in stocks.  i've refinanced my house and am paying extra on my payments what my old payments were.  with one extra payment/year, i save about 100k over life of loan.  i know most people think that's stupid because of the deduction you get, but i have a sheet that shows me the breakeven point.

more on this later.

 

[TJ]

I know somebody who lost $70,000+ before putting everything in cd's.  I know others who will not say how much they lost, but you can tell it was significant just by the way they act.     

 

[Davis Shorthorns]

mine lost almost 30% last year.  I am just glad that I still being young have time to rebuild it.  My girlfriend lost almost 25% of her stocks that she was saving until she graduated to buy cattle. 

 

[Torch]

Red,
Sorry to hear of your plight.

I know there are a lot of our countrymen who are in the same boat. We all are learning that paying someone to watch your money is a bad investment. Unless you cash out now you won't realize any losses and given some time and not to much medaling by the financial guru's in Washington   you will recover your losses.

If you are really fed up with the performance of you portfolio transfer your 401K into a IRA or Roth IRA. And if you do a good financial planner would be a smart investment. But then take a more active role in what you buy and sell.

Also if you have all or most of your portfolio in one company spread it out. And for those with CD's have them with multiple institution would be wise as well.

Just food for thought.

 

[chambero]

You haven't actually lost anything till you need to sell stock.  For those retired or close to it, you don't have as much money available.  For us younger ones, we still own the same number of shares we did and it will go back up.  If you bail out now and move to bonds or cash assets, you have lost your money. 

Kind of like owning cows.  It really doesn't matter what the cattle market does till you are ready to sell that cow.

 

[Jill]

Agree with Chambero, unless you are cashing out, the loss is only on paper.  Mine is down about 35% and it makes me sick so I just stopped looking at it.  This is the time to be putting money in not taking it out, I wouldn't advise anyone to transfer at this point. 

 

[dori36]

You haven't actually lost anything till you need to sell stock.   For those retired or close to it, you don't have as much money available.  For us younger ones, we still own the same number of shares we did and it will go back up.  If you bail out now and move to bonds or cash assets, you have lost your money. 

Kind of like owning cows.  It really doesn't matter what the cattle market does till you are ready to sell that cow.

And one of the hardest things to do is to hang on and try to wait 'til the investments wiggle back up.  Here's my biggest loser:  I bought a GMAC bond a couple of years ago paying 7% interest.  Now, "par" is the full value of the bond expressed as 100%.  I bought it at "par" meaning I paid full value - no discount.  But, I also get paid faithfully the 7% coupon twice/year.  Well, at its worst, the bond's value was at 25% of par!!!  YIKES!  Without sharing how much I actually invested when I bought it, suffice it to say that in any language, it represents a 75% decline in value!  BUT, it continues to pay me the 7% interest!  So, my investment guru advised hanging on rather than redeeming it and turning the 'paper loss' into an 'actual loss'.  Well, at close of markets yesterday, it has wiggled back to 73% of par.  Now, I "only"  have a 27% paper loss and I'm waiting it out!

 

[kanshow]

I haven't opened mine yet.. I might just take it to our tax acct. that way.. 

 

[oakview]

The financial advisors I have listened to lately say the stock based mutual fund is your best best over the long haul, outperforming all others over the past 40-50 years, including gold.  The ones I listen to say they have left their money alone in those funds and will continue to do so.  They all say you don't actually lose the money unless you bail out.  You can always call Dave Ramsey and ask him what to do.  By the way, they're saying we've had 12 recessions over the past 70 years, so the odds are we'll make it through this one in spite of what our fearless leaders in DC do.

 

[AAOK]

I guess it's all relative to how you go about living.  I worked for myself so long that I never saved anything.  We have a little in Roth IRAs and mutual funds, which has decreased about 27%, but it's a very small amount.  Speaking of Dave Ramsey, we chose many years ago to live on what we made.  We have been debt free for a few years, and got the kids graduated and married.  One thing about living in Oklahoma, our housing has risen the same as inflation, so we don't have to worry about property decreasing in value.  Unemployment is at 3.4% so there is no need to worry about having a job.  We just spend our money where we need it, and store it where we're told.  Here's how I see it:    "Do not lay up for yourselves treasures on earth, where moth and rust consume and where thieves break in and steal, but lay up for yourself treasures in heaven" Matt. 6:19

 

[JbarL]

i cashed mine in ... lock stock and  barrell ...about 90  days after "mission accomplished" was declared...i really never "seen" any "pre tax" advantage...never seen my employers matching money....i just kept given it to them....i havnt missed it a bit...the governement has never had a plan that took your  money and the working man ever benifited...taxes/social secrity/ medicare/...when bush started talkin' about puttin social security in a 401 k type plan...it was time for me to go....i guess im worth the same today as i was the day before and the day after i took it out....que sera sera .....jbarl

 

[justintime]

I agree with chambero, that you really have not lost anything unless you cash it in. And i also agree that is is similar to owning cows.

Here in Canada, we have had a bank that has been advertising for many years about " Freedom at 55". it basically is a plan where the bank helps you set up a plan where you can retire from your job at 55 and do all the things you always wanted to do. This works when market conditions are good, but after the events of the last year, many have found themselves in a situation where they will be working long past their magical 55.

 

[Cattledog]

I lost about 10k.  I'm 30 years young so I have time to recoup that. 

 

[JbarL]

I lost about 10k.  I'm 30 years young so I have time to recoup that. 

house phone/ cell phones      1200/yr
cable/internet service            1000/yr
health insurance                    6000/yr
automobile insurance              1500/yr
paper towels                            300/yr           
there it is......................10,000/yr         
should be able to do it by first of  next year if ya dont get sick or have a wreck...
coarse  weve all got plenty left  over each month for housepayments/ property insurance/ food / clothing  /car payment and transportion costs to work and back...we should all sign up to maybe just it all to them, and have them pay the bills for us.....jbarl

 

[jnm]

JBARL: Are you really advocating someone should go with out Health and auto insurance?

 

[JbarL]

JBARL: Are you really advocating someone should go with out Health and auto insurance?

jnm....hundreds  of thousands ( maybe millions )  of people do it every year....the only difference is whether they do it cause they cant afford it or they dont want to pay....if yoi make 25-35 K a yr  ...they is no way your can have all your cell phones/ cable news and sports channels / and hisgh speed internet servuces / health insurance/ automible payment AND insurance/ a house payment and eat ...and EVER  save ANY money....my point is yoiu sign a CONTRACT with yoiur employer to GIVE themyour  money out of your check for 25 yrs..( for a guy 30 yrs young)....they get there money FIRST..befroe you get anything...if you break your contract .....they keep any money you signed away....so yes ...if you want to ( or have to)  save 9700 ( the 300 dollares for the toliet paper is porbally the only  thing on that list that you have to have) in one year... im advocating not paying health and automobile  insurance ( been going on for years)...AND getting rid of all the other catagories we seem to think we have to have...do yo think they were checking for insurance cards and deducable criteria at the hospitals  in new york the day the towers fell ?, who do yo think paid  for all the ones that didnt have insurance that day ? ....no sense in me paying my premiuem and then paying for eveyone elses who wont or cant  pay  for there insurance ....is there  ??     ...jbarl

 

[Jill]

If you don't mind loosing everything you own go ahead and cancel that health and auto insurance, not a good idea in my book.

 

[kanshow]

First.. isn't it against the law to not have auto insurance if you have a car? 

Cancel the cable, cell, internet, but for heavens sake, not property, health, & auto. 

 

[JbarL]

If you don't mind loosing everything you own go ahead and cancel that health and auto insurance, not a good idea in my book.

i thought that was the reason for getting the  10K ???....cause we were " losing everthing"...if ya dont need it ...dont do it...if you need 10K to maintain ...how else are you going to get it ?....maybe ask your employer to let you out of your contract....and give yoiu  yoiur money now??...some folks talk desperation...but all they really got is an inconvience....while yoiur boss has your money.....jbarl