My 401K has lost ten grand over the past week.
My Roth IRA has lost $325.00 today alone.
I think my bottle of bourbon just skyrocketed in value. At least to me. I'm also wondering if it isn't time to liquidate everything and buy the largest block of gold I can afford.
On the upshot, I have a good 33+ years until retirement, so there's plenty of time so restock the retirement pantry. But I wonder what the sixty and over crowd are going to do? I mean, Wal-Mart only needs a certain number of greeters...
5 comments:
I don't understand how your 401K can lose money. I know nothing about them. Isn't it your money?
My Roth IRA was the thing that lost $325, so yeah, I've thought about it pretty hard.
And 401Ks aren't exactly like a bank account. The money you sock away into a 401k is pre-tax income that can be invested in any number of ways. In my case, I tried to diversify what I was holding, getting a little bit of everything and aiming for higher risk because I am young and can afford to take financial risks at my age. My 401K lost money because the money was tied to the stock market.
Gotcha.
And that sucks.
speaking of stock:
If you had purchased $1,000 of AIG stock one year ago, you would have $42 left.
With Lehman, you would have $6.60 left.
With Fannie or Freddie, you would have less than $5 left.
But if you had purchased $1,000 worth of beer one year ago, drank all of the beer, then turned in the cans for the aluminum recycling REFUND, you would have had $214.
Based on the above, the best current investment advice is to drink heavily and recycle.
And Darlin- shouldn't you play the margins with only 1/4 of your IRA? You should never bet the house, right?
If you are single, have the money to spare, and have over thirty years until retirement, you can pretty much risk whatever you want to. In fact, the first two factors don't matter as much as the third.
And if you risk more, you stand to gain more (or lose more). But I'm still WELL ahead of most people my age anyway, so it is all kind of relative.
But also for the record, I don't risk everything, especially not in my Roth IRA (taxes are going to be a killer when I retire, and my 401K will be taxed heavily, whereas my Roth will not).
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