Comments on: DON’T Check Your 401(k) Balance Today!

By: mapgirl

mapgirl — Tue, 06 Jun 2006 12:57:07 +0000

I heard the Marketplace Morning Report today and I seriously thought I should stop my Large Cap fund contributions and shift my 401K money into other investments. Then again, I still get a company match, so I'm not doing quite so poorly. ThatEdeGuy wrote about it here, and I think it's a good perspective for folks to keep in mind if they're the type to hit the panic button.

By: Kira

Kira — Tue, 06 Jun 2006 12:51:20 +0000

Actually I was very pleased by this drop because it meant my monthly contributions to my 403(b) – which were processed at the end of the day yesterday – got more shares for the money because NAV was lower. Since I am only 22 I am always quite happy to get some low priced shares, I’m not selling them!

By: Jenn

Jenn — Tue, 06 Jun 2006 10:24:21 +0000

You do realize that you just did the equivalent of telling someone NOT TO THINK OF A PINK ELEPHANT. Of course that has the effect of suddenly being able to think of nothing else except a pink elephant just because someone said it. Now that you’ve said not to check-you’ve made me want to check!

By: Robert Nanders

Robert Nanders — Tue, 06 Jun 2006 06:12:35 +0000

Good points, and I’m actually really lucky to have found this blog. Thanksf or the link, Matt.

By: Matt

Matt — Tue, 06 Jun 2006 00:19:44 +0000

Nice blog. I’m just starting my own personal finance blog. Keep up the good work.

http://roadtoretirement.blogspot.com

By: Vlad

Vlad — Mon, 05 Jun 2006 23:31:08 +0000

Foobarista,

Your theory is based on firm ground. What you state happens almost every year: the market moves in the first and last quarter of the year. In fact, the S&P Outlook newsletter, which I get, doesn’t fail to mention this every year. I’ve thought about doing it myself, but never do…

Regards,
Vlad

By: Foobarista

Foobarista — Mon, 05 Jun 2006 22:13:11 +0000

I have a crazy theory that has held up surprisingly well over the years: sell the S&P on May 1 and buy on October 15. This failed (rather spectacularly) in 2003, but has been a decent rule otherwise. The mid to late summer seems to be when a whole bunch of bad news and scare stories tank the market, and the winter is when people realize the sky isn’t falling.

Also, the mid to late summer in election years is when the political opposition (of either party) is pushing its agenda hard in the media and wants things to look awful.

I actually trade the S&P part of my 401K this way; it’s done much better than the S&P overall, except for 2003.

By: Vlad

Vlad — Mon, 05 Jun 2006 22:04:10 +0000

Also, Bob, my emerging markets holdings have by far outperformed everything, and are somewhere on par with my developed countries international small caps. I am planning to stick with them, especially since everyone is trumpeting the further decline of the dollar.

I will reduce these holdings if the consumer confidence in the US declines, however. They are sure to react strongly to this.

By: JLP

JLP — Mon, 05 Jun 2006 21:03:39 +0000

Vlad is always so eloquent! LOL!

By: JLP

JLP — Mon, 05 Jun 2006 21:03:00 +0000

Bob,

Personally, if it were my money, I would stick it out long-term. I think with emerging markets, you have to have a strong stomach.