Anything thinking of withdrawing their 401k?

[shooshoomanjoe]

My balance decreased about 20% since Jan of this year. With a possible recession looming, I don't want to lose more money so I've been thinking of just moving my 401k to my bank account. I'm afraid of seeing a large drop like it happened during the Great Recession back in 2007.

[Captain Nostalgia]

Yes, if the CPI report turns out good we should get a short bear market rally until November if earnings aren't to bad.

But OPEC's decision to cut back on oil production means the CPI report could be higher in November which would crash the markets to new lows. Hopefully inflation starts dropping fast.

The soaring dollar almost crashed the pension funds in the UK
Credit Suisse bank looks shakey
And the S&P 500's trajectory is most correlated with the 2008 crash.
United Nations is sounding the alarm of a major global recession.
Finally I'm really getting worried about Europe tipping over due to an energy crisis.

So I'll be waiting for the bounce and probably selling everything and looking at gold, it's a hard call though.

You could sell, and stocks may rally for a year, before they bottom, or they could crash in the next few months.

[Kirby101]

I think we are closer to the bottom. If you are diversified, stay put.
The only real danger I see is Republicans taking over the Congress and destroying the economy by not raising the debt limit.

[Jack Dracula]

You’ll typically be expected to pay a tax penalty if you do close it out.
Do some research and find out what experts as saying. Asking people on the internet isn’t the best strategy.

[Kirby101]

Chad makes an excellent point. Do not withdraw it, if you don't want to be invested, move it to a mone market or CDs within the 401K.

[Bryan]

I just changed my work 401k payroll deductions, was having 7% taken out but dropped it down to 3% because I am sooooo sick of losing money!!!

[Kirby101]

When the market is down like this, it is time to invest more. Do people think they can invest in the market and it will only go up and not have short down turns? Over the long term it goes up if you invest wisely. If you don't ever want a down time, only put it into interest bearing accounts or bonds.
Yes the market is down from the unreasonable highs of a year ago, but still up over the last years.
If you are counting your loses from the very top of the market, you are being unrealistic.

[kcomics]

Maybe so, but isn't 20 percent kind of a significant drop?

[hyped78]

My balance decreased about 20% since Jan of this year. With a possible recession looming, I don't want to lose more money so I've been thinking of just moving my 401k to my bank account. I'm afraid of seeing a large drop like it happened during the Great Recession back in 2007.

My advice is to ask experts, rather than unknown random people on a comic book forum. And I hope all goes well for you!

[Iron Maiden]

When the market is down like this, it is time to invest more. Do people think they can invest in the market and it will only go up and not have short down turns? Over the long term it goes up if you invest wisely. If you don't ever want a down time, only put it into interest bearing accounts or bonds.
Yes the market is down from the unreasonable highs of a year ago, but still up over the last years.
If you are counting your loses from the very top of the market, you are being unrealistic.

This is what my advisor had said even before all this turmoil. Yeah, the loss is hard to bear but I do have a mix of things. But it was really riding high for a while

[numberthirty]

One guy's "I'm No Professional..." take -

Totally get being uneasy about seeing a twenty percent drop, and getting sick to your stomach.

That said, a person also has to get real with themselves about just how far they would be willing to go to make a move like cashing out and sticking the money under a sofa.

First off, you don't just get to do so with right around "Zero..." consequences. Unless you are older than sixty(well, fifty-nine and one-half...)? You will take a ten percent "Penalty..." hit before you get taxed at you current rate. After you take that punch and kick? Then you get to stick whatever you are left with under the sofa.

All that said? It's not like you cannot lift a so much as a finger when it comes to this.

First off, see if you can stop(or lessen...) your contribution when the next quarter comes around. In addition to that? Talk the the person(I'm guessing a "Human Resources..." person?...) about the "Big Picture..." aspects of that 401K. Can you actually move money from it to an individual IRA where you(well, you and an advisor...) might have a bit more control over it? If so, that alone might make you more at home.

There are some other specifics, but that might be a worthwhile place to start.

[CSTowle]

If you're not retiring imminently count this as one of the market dips, wait for it to rally back, and probably watch the cycle repeat a few times before you're actually having to count your money for retirement.

[Captain Nostalgia]

I agree you probably want to talk to an investment advisor, a comic book forum isn't the ideal place......but here's the general consensus in the day trading world.

1. If the CPI report on Thursday is bad, it will really sink the markets, but if it is good, and earnings aren't too bad (the banks kick off on Friday) we may have a bear market rally in the short term.

2. When the fed stops its tightening cycle (Raising interest rates) the market could go on a run (Say January to the end of March when earnings start again)

3. Then at some point, next Spring, summer or fall, or in 2023, when the interest rates start to reflect heavily in the earnings, and we have a horrendous quarter, were most likely going to go into a steep recession. We are already in a technical one.

Most investors are warning of a hard landing, The CEO of JP Morgan just announced that stocks could drop another 20% if we have a major global recession, a lot of people are sounding the alarm bell of 2008, but....

no one has a crystal ball. The consensus could be wrong, always do your own research, and at the end of the day big crashes are normally followed by years of strong growth.

[frankiedetroit]

The market will go up, the market will go down. Rinse and repeat. Whatever you were investing before in your 401k before, I'd suggest keeping that contribution as long as you're able to live comfortably. You're losing money, yes, but you're also buying more shares of whatever you're invested in -- so when the market does bounce back (and it will) you will have that many more shares. I don't know how old you are, but if you are under 50 or 55, you should really stay the course.

[Kirby101]

That wouldn't be a total crash, that would be a collapse of civilization.