Fast Talk

With the current state of the economy, the safety of one's 401 k is a question that's on everyone's minds. There's an article here that explains what happens when your employer or the company administering your plan goes under.

Long-term I am not too concerned. One of the biggest pieces of advice I receive from financial investors is "do not take your money out of the market." But, stay in the low risk, and get out of the high-risk investments. If you look at the trends over the last 100 years, you will notice repeat patterns of bull and bear markets - it is inevitable that one will follow the other. What we cannot predict is whether our current bear market will take 6mo. or even 2 years before stabilizing. I cannot tell you how many times I have heard, the money you invest today will have the most impact on your retirement fund in the future.

WHAT 401k plan?

In the long-term, most companies will not go under as a result of the meltdown. I'm not too concerned, and neither should be the vast majority of Americans who will NOT lose their jobs.

I couldn't be more delighted that the ordinary Joes and Janes of this country finally stood up and roared, and if it cost me a little bit of retirement income in the long run, it was worth every dime to see this day. A fine day for democracy. What the folks in Washington and New York don't understand is that most Main Street folks don't have much, if anything, in the stock market and so they don't care if it drops like a stone. Tight credit and a bleak job market? How would that be different from what they're experiencing already? I don't have a 401k, just a Roth IRA. And sure, I realize that my index fund probably dropped a chunk today, but I've been gradually rebalancing away from it and into TIPS for a several years now in accord with my low tolerance for risk. I didn't trust this administration eight years ago and I don't trust them now. I sure don't trust them to do economic surgery with $700 B of our money and no strings attached. Here's a modest proposal: instead of $700 B cash for trash, why not use that money to forgive every student loan in the country? Giving the younger generation that boost to cash flow would goose housing prices for sure. Then maybe less of the bad paper would be under water.

Besides, any bill that unites Representatives Michele Bachmann, Steve King, Tim Walz, and Dennis Kucinich in opposition has got to be a really bad idea.