HB - curious about your reasoning. My husband works for the federal government, and he has a retirement plan similar to a 401K, so this is of interest to me.
You are discussing how to allocate your contributions to your 401K, right? Which, I assume, has an employer match of some percentage. And, I assume, you get paid every week or bi-week or twice a month, so the money is put in, via payroll deduction every pay period. I also assume that you are not close to retirement, and that you won't need the money for several years.
If you think stocks are going to continue to go down, why not continue to buy them? I mean, they are just getting cheaper, right? I am interested in your response, or that of Mr. Burke.
I make no pretence to be anything but a novice, and maybe I am a gullible one, at that, but I am looking at the cover of "Stocks for the Long Run," by Jeremy J. Siegel, professor of finance at Wharton, which has a graph showing the relative appreciation of stocks vs. bonds vs. gold vs. CPI from 1802 to 1997. According to Siegel, $1 invested and reinvested in stocks since 1802, adjusted for inflation, would equal nearly $7.5 million by the end of 1997. $1 in bonds would equal $10,744, in bills, $3,679, in gold $11.17.
I keep reading that, if you are careful in your selection, and have a long time horizon, stocks are superior to any other investment.
If you are reading this, Mr. Burke, true or not true, and if you had a 401K, would you allocate present contributions to stock funds or bonds or money market? (Assume retirement more than 7 years hence).
Thanks, CobaltBlue |
