401ks

[Lyrical]

Originally Posted by Brutul Tarew Marr

Hehe, people are amazingly irrational when it comes to stock. Dumping your stock on a "crash day" is the absolute stupidest thing you can do, yet it's a lot of people's first instinct.

So the futures show the market will open up +300 points. If these gains hold, the market will give back everything it lost this week.

I wonder, do the people that sell too early even realize how much they cost themselves, or are the ignorant enough to think that they did some good by getting out early?

[Soriak]

Originally Posted by Lyrical

I wonder, do the people that sell too early even realize how much they cost themselves, or are the ignorant enough to think that they did some good by getting out early?

They're going to wait a little, because they don't trust the upswing just yet. In maybe 2-3 weeks, if the market continues to do well, they'll invest again - same stuff they had before. Until stocks drop again, when they'll again panic and sell, just to buy again after the rebound. Some people never learn.

[Lyrical]

Originally Posted by Soriak

They're going to wait a little, because they don't trust the upswing just yet. In maybe 2-3 weeks, if the market continues to do well, they'll invest again - same stuff they had before. Until stocks drop again, when they'll again panic and sell, just to buy again after the rebound. Some people never learn.

The worst part is that the media is now over-exuberant. The market is up 425 points on the day, and now the reporters act as if we hit Utopia. It was just Tuesday when they were telling us we were in Armageddon. Make up your mind, is it the end of the world, or Utopia? Quit flip-flopping in the same week.

Anyone investing just need to tune out the market noise. The media almost always overexaggerates when the market is down by a decent percentage, or when the market is up by a decent percentage. You can't base your trading positions on their comments.

[prescient63]

Originally Posted by Snugglebear

As you get older and nearer to retirement age, you should start shifting your risky 401K toward more stable investments. This prevents you from retiring with nothing if you happen to retire during a down period, like right now.

Can anyone comment on compensation for the managers and brokers? It seems to still be in dotcom bubble mode and might screw over investors.

Say what???????????????

Your investments should be laddered more or less into diffrent buckets that make up your complete portfolio based on time frames. For instance years 1-2 in cash, 3-5 in bonds, 5-7 large cap, 7+ Large/Mid/Small mix. That way you have cash on hand, a stable income if you are holding your bonds until maturity, and positive appreciation in the future without regard to smaller market movements. You just keep shifting money forward as you deplete your cash. You can't move all of your investments to cash/bonds and retire because 95% of people will end up broke that way.

Edit: compensation for brokers and managers is good but not outrageous, and frankly underpaid considering the stupid things people will do with their money if left to their own devices. (see all the above comments)