401K Account Balance Recovery

Well, it took a long time, but my 401K decline in my portfolio value has finally broken even from my 401K balance highs back in 2008.  Today is officially Valentine’s Day as I write this, so it’ll be easy for me to remember!  I guess my account is telling me “Happy Valentine’s Day” (lol).

Here is the chart that show the Crossover point that I just crossed:

Cross-over point to the positive

It seemed like it took forever!

During the downturn spiral, I increase my contribution amount so that I could take advantage of the apparent dollar cost average that would happen during the dip.   I know this technique would prove to be valuable, but not as much as if I were a beginning investor…

A co-worker had just started investing in 2005, and he too increased his contribution amount to take advantage of the potential of the dollar cost averaging that was bound to happen.  Since 2008, the dollar amount of his portfolio has practically doubled!  He’s so lucky!

In my head (and the confidence instilled by Warren Buffett’s purchases) even though I went ahead with the increase in my contributions amount, I was still worried!  After all, this could have been another Great Depression instead of an intense but in contrast, short decline.  Luckily, it wasn’t as bad as it could have been (hopefully).

Next Steps

Now since I fully recovered, I’m tempted to rebalance my account in order to take out the presently high level of risk currently in the  account.  So I’ll move more money out of stocks into bond funds and money market funds.

Today’s a good day for me!  Now only if I were doing as well with my online discount stock broker and in particular my Roth IRA college saving account!

How’s your retirement accounts doing, are you back to the positive side yet?

-MR

Did you like this Article?  Then please subscribe to my RSS feed so you can check out new articles when they become available.  You will help this blog grow by doing so.  Thanks!

13 thoughts on “401K Account Balance Recovery

    • No, it doesn’t count that as part of the gain. It uses the real gain to calculate the percentage. From a dollar amount stand point, I would have met my high in 2010 sometime…

      I didn’t do much with my 401k balance, I just let it ride out the storm…

  1. My external account (non-retirement) is almost at the tippity high… still a bit short. Makes me feel better about not selling then! Because I did have that thought… wow, this is so high it isn’t going to last. (And I was right, but I had no idea the extent it was going to fall.) But if I’d sold then I probably wouldn’t have realized to put the money back in on time.

    That’s including dividend reinvestment, but no other contributions. (Though I did change from etrade S&P 500 funds to Vanguard S&P 500 funds.)

    My retirement accounts are much higher, but a lot of that is new contributions.

    • My total money balance is much higher, but my percentage gain over that 2008 to 2011 time period just broke even.

      I’m glad because it’s a perfect example of how the dollar cost averaging principle works.

    • Yes, that’s true, and that’s the smartest route to take, but I like to live a little on the wild side 🙂

      Once I get it out of my system, I’ll probably put my money in one of those age targeted retirement funds. They do all of that for you…

  2. I make contributions strongly to my own 401(k) although merely due to the fact I believe I’ve got no other option. The entire system is actually extremely poor as well as tailored for the needs of Wall Road. It’s up your corporation, not really you, to choose whether or not a 401(k) plan will be even an option, and also organization chooses exactly what funds to provide along with negotiating with the fund companies without having your involvement. In case your organization doesn’t use a 401(k) plan, you are able to start a personal IRA, although the there is a big difference in tax benefits between IRAs as well as 401(k)s.

  3. The typical American is actually clueless in terms of personal financial planning, and also generally will not look for assistance from a financial adviser till very late. We want to begin teaching our children fundamental financial planning as well as investment. We should all learn how to become more self-sufficient. Depending on the government to provide for the future is actually unsafe.

Comments are closed.