Anyone made changes to their retirement accounts?

[Starport Seven-Five]

Yes, but pensions used to be very regulated though, as in the categories of investments they were permitted to participate in were strictly defined and closely watched. The risk tolerated was guarded and strategic, really such funds were protected as a national interest. This is not what is happening now with 401ks, which is made plain by the losses & honestly what we are seeing could be a case study in what is wrong with the current structure.

My 401k's (multiple) all have options for index funds, bond funds, target date funds, etc. What options in there do you feel is harmful?

I may be a bit immune to this as I've been investing in the stock market since I was in my mid-20's but I find my 401ks to already have training wheels relative to the actual market. The worst I've heard relative to 401k mistakes are people who somehow end up putting money in that sits in cash instead of getting invested. That seems to be a mistake on their part though as most set you into a target date fund by default.

 

[georgina]

I had a small work-sponsored 401k investment account. About a year ago, shortly after I retired, I transferred it over to an annuity. No gains, no losses. Just peace of mind.

There’s a lot to be said for peace of mind! Annuities get a bad rap, often because of fees, but there are several different kinds. We have a lot of stock and mutual fund investments but several years ago put some money into annuities with a lifetime monthly payout and have no regrets.

when DH retired we rolled his 401k into an IRA and I have been gradually converting it to a Roth. Taking advantage of the price drop to convert more, basically just rolling it from the IRA to the Roth in the same mutual fund so no losses overall.

 

[georgina]

My 401k's (multiple) all have options for index funds, bond funds, target date funds, etc. What options in there do you feel is harmful?

fidelity is adding cryptocurrency to its 401k options.

 

[DCLMP]

Agree on both points. It really doesn't take much to build a sizeable nest egg but it does take discipline and self control. Cutting investments due to *insert random excuse here* or pulling money out for an "emergency" is why many are in bad shape.

It doesn't take much time to do that. "Most people" have time to watch Dancing with the Stars or whatever other mindless entertainment program. You could easily learn enough about 401k's to set yourself up for success in less than an hour.

You might be right or you might be wrong. Giving blanket advice like this is pretty foolish though IMO.

Foolish? I’m not a licensed financial advisor I can say whatever I want. It’s called an opinion not advise The Fed is buying up debt to stabilize the debt market after the huge spike in the 10 year last week. Everything they do is inflationary. Maybe we’ll get a bounce, but I personally don’t think we’ve hit bottom not by a long shot. I expect the S&P to move lower this week, but again just an opinion. Lots of opinions out there to read. Enough to make your head spin.

I find most people put money in their 401k and let fidelity or whoever manage it. Trading is a full time Job that most people including myself don’t have the time for.

 

[QueenIsabella]

Foolish? I’m not a licensed financial advisor I can say whatever I want. It’s called an opinion not advise The Fed is buying up debt to stabilize the debt market after the huge spike in the 10 year last week. Everything they do is inflationary. Maybe we’ll get a bounce, but I personally don’t think we’ve hit bottom not by a long shot. I expect the S&P to move lower this week, but again just an opinion. Lots of opinions out there to read. Enough to make your head spin.

I find most people put money in their 401k and let fidelity or whoever manage it. Trading is a full time Job that most people including myself don’t have the time for.

Who says you need to trade? I tell my kids to use my "patented" "set it and forget it" strategy. Every 6 months to a year, maybe re-balance. But, my kids are talking fairly small amounts at this point, and aren't really interested in trading. I know through Starbucks, DD19 is in the "2065 Target fund" I think it's called. It's actually a little early for a youngster like her, but was the latest one they had. For my older two, we invested them moderately aggressively--if they'd like to change the mix, they're free to do so, but that would mean understanding their investments better, and they don't care to do that. Which is fine--we're not going to deliberately steer them wrong. The important thing is, they're investing regularly, and leaving the money alone.

Of my four kids, only the youngest has much interest in investing--he follows individual stocks, mostly in the tech sector. He just got his first job and first debit card--he'll have his first Roth by the end of the year. He's the kid most likely to be a tycoon one day. I'm looking forward to the large checks he'll send home to Mom and Dad!

 

[RamblingMad]

fidelity is adding cryptocurrency to its 401k options.

Sounds like gambling.

When are they going to add lottery tickets?

 

[wabbott]

Who says you need to trade? I tell my kids to use my "patented" "set it and forget it" strategy. Every 6 months to a year, maybe re-balance. But, my kids are talking fairly small amounts at this point, and aren't really interested in trading. I know through Starbucks, DD19 is in the "2065 Target fund" I think it's called. It's actually a little early for a youngster like her, but was the latest one they had. For my older two, we invested them moderately aggressively--if they'd like to change the mix, they're free to do so, but that would mean understanding their investments better, and they don't care to do that. Which is fine--we're not going to deliberately steer them wrong. The important thing is, they're investing regularly, and leaving the money alone.

Of my four kids, only the youngest has much interest in investing--he follows individual stocks, mostly in the tech sector. He just got his first job and first debit card--he'll have his first Roth by the end of the year. He's the kid most likely to be a tycoon one day. I'm looking forward to the large checks he'll send home to Mom and Dad!

Get him to start reading the old Disney Uncle Scrooge comics. When it came to money, nothing got by him.

 

[longboard55]

There are times the buy and hold strategy just does not work. This is one of those times. If the S and P drops 25% and I drop 15%, I figure I am doing well

 

[DCLMP]

Who says you need to trade? I tell my kids to use my "patented" "set it and forget it" strategy. Every 6 months to a year, maybe re-balance. But, my kids are talking fairly small amounts at this point, and aren't really interested in trading. I know through Starbucks, DD19 is in the "2065 Target fund" I think it's called. It's actually a little early for a youngster like her, but was the latest one they had. For my older two, we invested them moderately aggressively--if they'd like to change the mix, they're free to do so, but that would mean understanding their investments better, and they don't care to do that. Which is fine--we're not going to deliberately steer them wrong. The important thing is, they're investing regularly, and leaving the money alone.

Of my four kids, only the youngest has much interest in investing--he follows individual stocks, mostly in the tech sector. He just got his first job and first debit card--he'll have his first Roth by the end of the year. He's the kid most likely to be a tycoon one day. I'm looking forward to the large checks he'll send home to Mom and Dad!

Some people enjoy it. You have to build up enough capital to do it and then you have to the stomach for it. I think you also have to be a little bit of a gambler.
Like you said you have to rebalance when the market changes. I wouldn’t just sit by and watch it plummet. We were in a massive bull run for the last 6 years so it’s hard to complain.

 

[Frwinkley]

You can always move to cash and then get back in later or move money into something with less risk. It’s going to drop more.

I would not do this. You are then selling at a loss. Ride it out. If you're only 48, you might not need to access this money for 10 years or more (depending on when you plan to retire).

I will retire in 2 years. DH is already retired. We have a few years worth of savings in cash, but the rest is a bit riskier. We are riding it out. I will also have a good pension that will cover 80% of our expenses before we decide to take social security.

Something to consider: the focus is always on growing your money from 30 to 60. However, your money still needs to grow from 60 to 90 (depending on your expected longevity). Obviously, nobody can predict that.

The only thing I'm doing differently is not looking at my accounts frequently.

 

[DCLMP]

I would not do this. You are then selling at a loss. Ride it out. If you're only 48, you might not need to access this money for 10 years or more (depending on when you plan to retire).

I will retire in 2 years. DH is already retired. We have a few years worth of savings in cash, but the rest is a bit riskier. We are riding it out. I will also have a good pension that will cover 80% of our expenses before we decide to take social security.

Something to consider: the focus is always on growing your money from 30 to 60. However, your money still needs to grow from 60 to 90 (depending on your expected longevity). Obviously, nobody can predict that.

The only thing I'm doing differently is not looking at my accounts frequently.

You might not be selling at a loss the market has gone straight up for 6 years. There’s nothing wrong with taking profits. You can always get back in when the market hits the bottom. There is no guarantee what you invested in now is going back up. We're up 50% since 2016 and down about 15% so far this year. I wouldn't say that's selling at a loss.

 

[amylevan]

Our advisor had us move 50% to less riskier stuff. So half of our funds are riding it out, and half locked in the gains of the last couple of years and are on hold to go back in when things are better.

We are also continuing to sock away the same amount as before.

 

[dvcgirl67]

Sounds like gambling.

When are they going to add lottery tickets?

It's nuts that Fidelity is going to allow that, especially that we're watching that "asset" bubble completely crash. In a way, we're lucky that the crypto bubble didn't get any larger than two trillion because the ripple effects to other asset classes could have been even more disastrous.

 

[DCLMP]

It's nuts that Fidelity is going to allow that, especially that we're watching that "asset" bubble completely crash. In a way, we're lucky that the crypto bubble didn't get any larger than two trillion because the ripple effects to other asset classes could have been even more disastrous.

Crypto has crashed about 400 times.LOL I don't really understand the crypto market and I've never really made the effort to learn it. Is there a buying opportunity on the horizon..I just don't know.

 

[DCLMP]

Our advisor had us move 50% to less riskier stuff. So half of our funds are riding it out, and half locked in the gains of the last couple of years and are on hold to go back in when things are better.

We are also continuing to sock away the same amount as before.

I think that's a good approach. We have 60% in zero risk. My DH actively trades with the riskier stuff mostly commodities at this point. He has a five-year plan we shall see if it works. The market is so manipulated and volatile. I'm more interested in macroeconomics, geopolitics, and the big picture. I can't look at graphs and charts all day.

 

[dvcgirl67]

Crypto has crashed about 400 times.LOL I don't really understand the crypto market and I've never really made the effort to learn it. Is there a buying opportunity on the horizon..I just don't know.

It's just pure speculation at its core. I understand the fundamentals of "bitcoin mining", but also know its a huge drain on energy resources. But other than that....crypto and NFTs are the "asset category" that will define "peak crazy" during this period. Without super easy monetary policy/cheap money flows....I have a hard time seeing where the money to fund another boom in that category even comes from. People are beginning to lose wealth across the board now...equities, bonds, and housing will follow. I think the heyday for crypto, NFTs, meme stocks soaring on Robinhood....are over.

 

[DCLMP]

It's just pure speculation at its core. I understand the fundamentals of "bitcoin mining", but also know its a huge drain on energy resources. But other than that....crypto and NFTs are the "asset category" that will define "peak crazy" during this period. Without super easy monetary policy/cheap money flows....I have a hard time seeing where the money to fund another boom in that category even comes from. People are beginning to lose wealth across the board now...equities, bonds, and housing will follow. I think the heyday for crypto, NFTs, meme stocks soaring on Robinhood....are over.

This is the fourth time it's lost 70%. It will be interesting to see what happens this time.

 

[longboard55]

One of the issues with crypto, is it has no use. Visa is an alternative to cash but they spend millions on marketing and advertising. Who uses crypto, no one. You either buy it or sell it.

 

[_19disnA]

Bitcoin and all of the 'me too' followers has always been a smoke & mirrors situation. It isn't a company, makes/sells no product/service, generates ZERO revenue or profits. All of the things you typically consider when deciding where to invest. Its 'value' is totally based on finding the next person willing to pay more for it then you did. Not very much different from a pyramid scheme in my book. When there are no more people willing to dump money into it, the whole scheme just collapses. Get rich quick schemes usually end badly, particularly for those who threw money into it within understanding what they were actually buying.

 

[LuvOrlando]

My 401k's (multiple) all have options for index funds, bond funds, target date funds, etc. What options in there do you feel is harmful?

I may be a bit immune to this as I've been investing in the stock market since I was in my mid-20's but I find my 401ks to already have training wheels relative to the actual market. The worst I've heard relative to 401k mistakes are people who somehow end up putting money in that sits in cash instead of getting invested. That seems to be a mistake on their part though as most set you into a target date fund by default.

Don't you notice the big swells then the giant losses over and over again, like someone somewhere knows where all the money is sitting and is betting against it as an easy peasy way to get rich, knowing that all the 401Ks won't adapt in time and so the owners of said 401Ks are forced to just ride it out, or is it just me? it could be just me.