Checking your 401K may be too stressful

[Liberal_in_LA]

http://www.abc4.com/news/local/story.aspx?content_id=7cf0d795-67f3-4da5-94e6-857a8aee094f

Checking your 401K may be too stressful

(****snip****)

One woman at the Gateway told ABC 4, "I have and I think that it’s something I need to stay away from because I think it could cause some depression."

And it’s not just 401K's.

Cindy Adamson is trying not to panic, even though the college savings accounts for her three kids are down about 30 percent.

(****snip****)

Some people told ABC 4 they feel the American dream slowly slipping away and that they've worked hard, saved, invested conservatively, but now Wall Street, in their words, has "burned them."

One woman said she has now lost so much money in her 401K, she now refers to it simply as a "201k."

[GardeningGal]

1. I made that mistake the other day.

I'm not going to look at it again for quite some time.

[Common Sense Party]

2. I consult on 401(k) plans. I teach people the basics of long-term

investing every day. And as I always tell them, during the three year bear market of 2000-2002, I didn't open any of my statements. I just filed them away. I knew the value was going to be down. I just didn't want to see how badly it was down. I knew it would bounce back, eventually--just as it will bounce back eventually from this crater.

[pitohui]

3. 1929-1952 that's how long for DOW to break even after the crash

nobody can wait that long to send their kids to college, truly a dream deferred is a dream denied, the kids would be middle-aged by the time the money is replaced

the same for retirement, if i'm 65 today, i can't wait 25 more years just to break even, i have to eat today

this is the fallacy of the "long term view," the human lifespan is not long enough for us to tolerate these swings, if you happen to reach a milestone at the wrong time (kids going to college, retirement, etc.) at the wrong time you're fucked because we don't live dozens of decades, we live less than 8 or 9 decades

[Common Sense Party]

5. That's how long it took the Dow price level to come back.

It wasn't that long for someone more diversified that was reinvesting dividends along the way, buying more shares.

Obviously, if you're 65 you don't have 25 years. That's why you shouldn't be 100% in equities when you're 5-10 years away from retirement.

There really is no fallacy of the long-term view. There is prudent and selective application of it.

[girl gone mad]

13. I think it was 1987, if you account for inflation.

And the Nikkei is once again trading below where it was 25 years ago.

[Liberal_in_LA]

4. three years without looking? That takes discipline

I'm not going to look online. Will look when I get my 12/31/08 statement/

[Common Sense Party]

6. Maybe part discipline, but also part laziness.

But if you truly are saving this money for retirement, and that's decades away (as it is for me), just looking at what you've "lost" (even though it isn't lost) can induce anxiety or panic. People who panic do foolish things like move to cash.

[nadinbrzezinski]

7. Hey some of us are actually thinking of getting some really undervalued

stock with good P\E ratios... and just seat on them for 20 years

I can afford to "risk" a little this way

[Common Sense Party]

9. You and me, both. I'm (fairly) young and I'm greedy.

This is a Blue Light Special on good companies. I love a good sale. I'll gladly buy some shares now when they're marked down. But that's because I have time to watch them go up again in value.

[w8liftinglady]

8. I checked mine..I'm screwed

[Common Sense Party]

10. How close are you to retiring? n/t

[w8liftinglady]

11. i'm 47 and a nurse..I guess I can work forever

[Common Sense Party]

12. A lot of us will. But at 47 you're not screwed. You still have

at least, what, 13-18 years until retirement? You still own the same number of shares in your 401 today as you did last week. Those shares WILL come back up in value eventually. Plus you can buy more shares now while they're on sale.

Remember, today's prices aren't your prices, unless you need to cash them in real soon. You care what the prices will be when you retire.

[nadinbrzezinski]

14. You still have time for it to recover

this is NOT the time to run for the hills