How Low Can Your 401(k) Go?

401k Bargains

Why would so many people take money out of their 401(k)? There is only one word - FEAR.

Warren Buffett likes to say that to be a successful investor, don't follow the crowd. "Be fearful when others are greedy, and greedy when others are fearful."

http://www.brainyquote.com/quotes/authors/w/warren_buffett.html

For those who have at least 5 or more years to their retirement, they need to stay invested, speak with a professional advisor to check their diversification and risk tolerance, and think LONG TERM.

The four worst years in the S&P 500 since 1930 are

2008, 1937, 1974, and 2002. Here is something interesting you may not know - returns (also S&P) from the years following these "down" years.

1938 +31.1%

1975 +37.2%

2003 +28.7%

2009 ??

So if an investor had "sold out" in one of these years, they would have missed a lot of gain. What does 2009 hold? We don't know, but as Warren Buffett also says, "If you wait for the robins, spring will be over."

Read more about 401(k) Bargains at http://401kcoach.myblogsite.com/ You can also visit my website at www.helpmy401k.us.

Dean Voelker of IN @ Apr 30, 2009 17:01:04 PM