With 401(k) Accounts Booming, What Should Investors Do?

Ted

FYI: Did you notice that your toe doesn’t hurt because you didn’t stub it today?

We tend to pay the closest attention to things when they’re going badly, and the same is true of the stock market. When stocks crashed during the financial crisis in 2008, phone lines for financial advisers and 401(k) providers were jammed with panicky investors. Now stocks are at record highs, and the market is tranquil. It’s easy to feel comfortable leaving your account on autopilot.
Regards,
Ted
http://www.denverpost.com/2017/08/03/401k-accounts-booming-what-should-investors-do/

Sven

401(K) is a long term investment for 30-50 years horizon. Unless one is invested in target dated funds, rebalancing on a regular basis (quarterly or annually) is necessary rather than leaving it on autopilot.

rforno

Frankly ... and I don't mean to start a dogmatic fight here ... but I've never been a big fan of such "rules" about allocation percentages, rebalancing, and so forth. I don't rebalance any of my long-term accumulating portfolios, other than to make sure it's allocated in sectors/companies/position sizes that let me sleep well at night. (I'm 90+% in equities and equity funds across my various accounts....but what works for me may not work for someone else, as is the nature of many things in life, including investing.)

My 403(b) is 95% in one largecap equity fund (RWMGX) with a smidgen of idle cash in the account ready to deploy onto that position if there's a market swoon before employer contributions resume in the new academic year.

Sven said:

401(K) is a long term investment for 30-50 years horizon. Unless one is invested in target dated funds, rebalancing on a regular basis (quarterly or annually) is necessary rather than leaving it on autopilot.

davidrmoran

+1
Nothing wrong w/ autopilot for some investment styles, in my experience.