401k balances hit record high

[Native Floridian]

Fidelity Investments announced this week that 401k account balances under it's custodianship reached new highs this month. Fidelity reported median 401k balances of just over $200,000 for accounts that have been open for a decade or more.

Considering the meltdown of 2008, that's an impressive endorsement for the long term wealth generating ability of the world's stock markets.

 

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[pat-tekker-cat]

I had an interesting visit with my investment fella yesterday. Feds are going to keep interest rates low, through at least 2016. Only way to keep the vig on our loans from bankrupting us, more or less.
I pulled outta FI, went to FT, up 16%. I'll take it, ty! Best FI did for me, was 6% growth.

just never keep all your eggs, in one basket.

 

[Native Floridian]

Once the Fed starts to ease Stimulus rates will start to rise. That will hammer bond prices. I am suspect of any yard stick longer than 3 months.

In June of this year the Fed announced that it would start to step away from its bond buying program in September. Both the bond and stock markets got rocked! By mid July the Fed started to walk away from that announcement and by end of August the markets recovered. Just a preview of what is store once the Fed does start to taper.

That doesn't make me a bear. Just wary. In my own portfolios, no LT Bond funds or long duration bond funds. Repositioned those assets to FI managers with histories of increasing value in increasing interest rate environments. That's no guarantee, but you've got to hang your hat someplace!

And as always, I play both sides. i'm ready to buy puts or sell short.

 

[TheCoinKid]

Hey NF, I haven't heard that retail investors have returned in droves yet, which often is a signal of a market top. What do you see? Feeling bullish for a little while longer.

 

[Native Floridian]

I do feel bullish right now. The economy is really starting to kick in and there isn't any competition for the investment dollar.

That said, it's not full steam ahead. The stock market could pull back 15% or more on a dime! look back to June when the Fed said they would start to taper in September. Almost as soon as Bernanke said that he backed away from it, but the damage was done. Immediate and quick reaction from both stock and bond markets.

As it has turned out no tapering yet. But that day will come.

Another factor is we've had a big run here, so there is room for profit taking.

Lastly, the small retail investor has returned to the market.

Advice i would give anyone would be to learn how to short the market or buy Put Options. Holding these can be effective insurance against a decline. ORRRR, a way to make big profits when everyone else is running for the hills!

 

[diggummup]

401K, What's that? I've been self employed just about my entire life. My 401k is metallic. I call it my redneck 401k. I add to it monthly, sometimes weekly. I depend on myself period. If the stock market crashes, so much the better for me.

 

[Native Floridian]

401K, What's that? I've been self employed just about my entire life. My 401k is metallic. I call it my redneck 401k. I add to it monthly, sometimes weekly. I depend on myself period. If the stock market crashes, so much the better for me.

metallic - Gold?

Hmm. gold is down in price only 24% this year. Stock market up over 22%.

So you distrust the stock market but trust the commodities market?

Looking at those numbers is why professional advisers recommend a mix of assets.

Kinda simple - like your grandmother always said - don't put ll your eggs in one basket.

 

[diggummup]

metallic - Gold?

Hmm. gold is down in price only 24% this year. Stock market up over 22%.

So you distrust the stock market but trust the commodities market?

Looking at those numbers is why professional advisers recommend a mix of assets.

Kinda simple - like your grandmother always said - don't put ll your eggs in one basket.

As long as i'm paying a fraction of spot price, i'll continue. Not just gold, but silver too. And yes, I know it has dropped even more than gold. I've tripled the amount of money I "invested" this year so far. More than doubled it the year before, etc., etc., etc.. Why wouldn't I invest in physical pm's? Don't get me wrong. I'm sure the stock market is great for some people. It's just not for me. I have trust issues when it comes to my money. I do not trust anyone other than myself. If I lose it, I have no one to blame other than myself.

 

[Native Floridian]

Dig, who ever said if you have your health you have everything never worked with other people's money! Money is a highly personal and emotional topic. How you handle it is purely your business as the person who has to answer for it's loss is the same person who stares back at you in the mirror when you shave. You need to know you did what you thought was right.