Don’t Change 401(k) Mix During Market Drops

We’ve seen a few sudden and sizable drops in the financial markets in 2019. But you shouldn’t overreact to such events – especially if it means making radical changes to your 401(k).

And yet, many people do just that. During market downturns, investors often move money from their 401(k)’s stock accounts into perceived “safer” accounts, such as those primarily containing bonds or other fixed-income vehicles. But such a move could slow the growth potential of your 401(k) – and slow your progress toward your important goals.

Of course, you may eventually have some valid reasons for adjusting your 401(k)’s investment mix. For example, if you’re nearing retirement, you may want to lower the risk level in your portfolio. Or, if you eventually change your mind about what sort of retirement lifestyle you want, you may need to invest more or less aggressively.

In any case, don’t let short-term price drops cause you to make poor decisions. Your 401(k) is a long-term investment – one that can reward you for showing patience and discipline.

If you have any questions please contact me at 980-859-2549 or by e-mail at Brandon.Monette@edwardjones.com

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.