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Spring Clean Your 401(k)

You can Spring Clean your 401(k) too!


By now most Minnesota company retirement plan investors have received their individual company retirement plan statements for the first quarter of 2013. Those statement values are the highest in many years.

Unfortunately, we all know from our previous stock market experiences that the high-water marks on quarterly company retirement plan account statements sometimes don’t last long enough for us to feel good about our growing retirement assets.

Many company retirement plan participants I meet with are just now recovering their company retirement plan account values from four to five years ago. With the stock market now at multi-year highs, make sure that your current company retirement plan accounts values don’t drop again in a big way anytime soon.

This spring is a great time to finally break out of the every-few-years up-and-down stock market company retirement plan account value cycle.

Most company retirement plan participants own far too many of the same kind of stock market mutual funds. For sure you currently own at least one or two mutual funds that have not kept investment pace with the other mutual funds you own.

Those are the mutual funds that you should Spring Clean now.

Before the next big economic or stock market crash, sell the worst mutual funds you currently own that have lagged the U.S. broad stock market indicators.  Put the proceeds of the sales into the money market account in your company retirement plan menu.

Selling the worst couple of mutual funds you currently own at close to multi-year price highs in not a bad idea.  Protecting the proceeds in your company retirement plan money market account is an even better idea.

You can always get back into the stock market at a later date and buy the better mutual funds in your company retirement plan menu.

This Spring, sell the worst mutual funds you own, preserve the gains, and wait for a time to buy better company retirement plan mutual funds “on sale” at a later date. That is what a Spring Cleaning in your 401(k) account should be all
about.

Ric Lager
Lager & Company, Inc.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Mark Lenthen June 06, 2013 at 09:45 PM
You can also buy houses and other investment assets like gold if you move your 401(k) into an IRA. There's a whole guide on http://www.holdyourira.com

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