I am totally ignorant when it comes to 401K...

How does a person go about "freezing" their 401K to keep from losing money each quarter?

I've tried to call the plan administrator, but apparently I'm not the only one who wants to talk to them.

Secondly......I have no idea what I'm talking about so I don't know if what they tell me is what I'm supposed to do.

I'm at their mercy out of ignorance.

I've lost each quarter and I don't want my money played with anymore for a while.


Any advice is welcome!

About a year ago I moved all of mine to a Stable Asset Fund and a Bond fund because I felt the market was about to bottom out and looks like it is. I have only made about 3% which isn't much but it's better than loosing the 20-30% that I would have lost had I left it where it was. You might want to try that cloud.

Cloud, the most important thing to remember here is IT’S YOUR MONEY, so first of all you need to get yourself informed. Then, you decide what risks you want to make…good times included. With this melt down, I’m not sure anyone in the business has good answers for you…keep on trying to talk to your admin. Unless you know and trust a broker it’s kinda like this forum…everyone has an opinion. I’ve never heard of freezing a 401K. You need to contribute at least 6% to be in the plan and remember you’re getting the matching funds…usually in co. stock. You have options to move around, but that is usually once a year. You might consider also you will probably take a hit moving anything if it isn’t during that window and sometimes you pay a fee on certain funds to transfer even during the open window. If you aren’t comfortable with equities…there are some fixed income options that would give you more of a warm and cozy feeling, but like Darkwolf said, your return is not gonna be much the way the economy has been. Good luck!

Keep right on investing just like always. Hasn't anyone ever heard of "dollar-cost averaging"?

A 401K program is a "Long Term Investment Tool". If you start trying to pull you money everytime the market pharts, you lose a ton of money. You have people managing your funds. It is their job to maximize you income. They generally know what they are doing. Let them do it. The only time that you should worry about the value of your 401K is the day you are ready to start drawing on it. In the interim it will be up and down.
If you freeze it now, when will be the right time to unfreeze it? By the time you can "thaw it out" and get it back into the market, the prices may be down again. Trick is to have a good market manager that you trust. Let them do their thing and stay off that phone. All you and I know to do in the market is mess up.

I agree with everything Mr. Pate and Mr.Dent said.I will add look on the web for Dave Ramsey on his site look for an ELP.They are local people that really know what they are doing.

Cloud, I watched a story about this on Good Morning AMerica this morning and immediatly thought of you and this thread. The cute little financial guru, Melody Hopson, said the exact same thing as posted above....DON'T TOUCH IT! It is made to wax and wane with the market. And heck, as young as you are, you have plenty of time until you retire...being that you are 25 and all.

quote:

Originally posted by parrothead:
Cloud, I watched a story about this on Good Morning AMerica this morning and immediatly thought of you and this thread. The cute little financial guru, Melody Hopson, said the exact same thing as posted above....DON'T TOUCH IT! It is made to wax and wane with the market. And heck, as young as you are, you have plenty of time until you retire...being that you are 25 and all.

Thanks ya'll......you are correct with your advice and I appreciate it. I can't help but think of all the retirements that went out the window a few years back and I guess I got spooked a bit.
I will say though, I'd rather over react when it comes to finances than under react.


And Parrot.....you are so right.......I have plenty of time to worry since I am only (ahem.....25
ducking before lightening strikes

quote:

Originally posted by Mikenphiladelphia:
I agree with everything Mr. Pate and Mr.Dent said.I will add look on the web for Dave Ramsey on his site look for an ELP.They are local people that really know what they are doing.

Wouldn't be so sure of that... Daves recommended picks are ppl who pay an advertising fee. They do not neccessarily have his financial beliefs. I know this because his for Mississippi is in Hattisburg. After a family member lost there job and needed to move there 401k they called and met with him. After the meeting she asked him what quailfied him to be endorsed by DR. He told her that he paid a $600 fee a month to be a DR recommended advisor. She chose an advisor in Merdian.

I don't have a 401k. The retirement system I am under didn't require one but gave the option to have unil shortly before I retired, that late in the game I stuck with my non-401k retirement plan. But with some many big compainies going bust and their employees' 401ks going bye-bye, perhaps that was well and good.

This message has been edited. Last edited by: warthog,

quote:

Originally posted by Dent:
If you start trying to pull you money everytime the market pharts, you lose a ton of money.

If you freeze it now, when will be the right time to unfreeze it?

Well I'm glad I had mine put in a stable bond. It's dropped over 3,000 points since I did which would have lost me a lot of money. Dropped 777 points just today. I understand what you are saying about leaving it alone, especially if you have no clue what you are doing but now I can put my money, that I didn't lose from the market drop, back into the stocks I had it in originally and buy a lot more of it because it's a good bit cheaper now then it was when I 'sold' it. It's all a gamble and sure, the safest thing to do is get someone to manage it for you if you don't mind paying them for that service. It could save you lots of money in the end. I'm sort of a risk taker and that's why I pulled mine out a while back. I expected something was bound to crash it pretty soon the way things were going.

Cloud: Everything I have read concerning your inquiry is good advice. May I add a bit or two more?

There was a time when a person had to take their employer's matching money and put it into the company's stock (the employer's stock). I understand that the law has changed now so that your employer's match can go where you want it to go. Unless you work for DuPont, Chevron, the Southern Company, Boeing, TVA, or some company of that stature, I would not put one dime in the stock of my employer. If you are as young as you say, I would spread my 401K money out into as many different kinds of companies as possible.

Too many people have been bitten when their company folded. They were not only out of a job, but all they had was some worthless paper saying they owned X number of shares in the now out-of-business outfit. True, they did still own some good stock in other companies where their contribution went.

As far as a 401K counselor is concerned, choose one who charges only an annual fee based on the total value of your investments. Some investment counselors will "churn" your account to make money off of you.

What is churning? Let's say you have an investment counselor who charges you 4% on the front end for investing in some stock or a fund. After you've been in that fund for a year or so, your friendly counselor calls and says to drop by. He has this great new fund he wants to tell you about. Hell yes he wants to tell you about it so he can get you to move some money into it and get 4 or 5 percent off you. Trust me - I was bitten like that once. I learned the hard way. I trusted the B*****D.

Anyone with knowledge or advice please keep this thread going! Any and all info is appreciated!

I agree, Bosslady.

If you are under 60 and have money in stocks of any sort LEAVE IT ALONE!!!!I am not putting as much in and am buying some short term safer stuff,only because I don`t think we have hit the bottom.But I have not taken a penny out.The worst thing the tv news has done is give the dow report every day,don`t look at it .look at it once a year or quater ,these are long term investments.