Thursday, July 10, 2008

Perhaps THIS wasn't the best time to try to get that 401k to grow.

I'm not sure if any of you check the items on the 101 list that are currently in progress. I put them at the top so they are easy for me to update. If you HAVE been watching, you've seen that the progress I've made towards having $XXX,XXX in my 401(K) has been going the WRONG direction. This isn't because I've foolishly been dipping into it to feed my wild lifestyle (HA!). It's simply because it has been losing money. I'm sure many of you are in the same boat.

At first, I wasn't terribly bothered by the dip in my balance. I kept reassuring myself that I was buying those stocks On SALE every time my contribution hit my account. In fact, I even upped my contribution %. I thought, "They're on sale! I should stock up!"

Let just say that my enthusiasm for this line of thought has wained considerably. Despite raising my contribution level, I have "lost" over 10% of my account value since the beginning of the year. That means that, despite having put about 15% of my pay into my account since the beginning of the year, my actual account balance is only VERY slightly above what it was on January 1, 2008.

Now many of you, myself included at times, will say that I haven't actually lost anything. I still own all of those stocks. I don't think that really counts when they aren't worth as much and the value keeps dropping every day.

All of this is to say that perhaps trying to get to a certain dollar amount by July 15, 2009 may be out of my grasp. When I made the goal, I had to earn a tiny .023% of my account balance each day or 8.7% annually. Because of my losses over the last 9 months or so, that amount has grown to 23%. Now come on, people! Is that really going to happen? After all, I don't think we're in the Clinton administration anymore, Toto.

1 comment:

IndyLovelace said...

You ARE buying the stock at a discount. Keep at it and KEEP putting in as much as you can stand. I've been in my 401K since 1998 and its been well worth it. Sure, the short term value has dropped, but over the 20 years...I've averaged about a 12% return. Slow and steady wins the race!


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