Last week was a rocky one for the stock market. Maybe you also experienced the turmoil of asking, “what’s happening to my money?!?”. Personally speaking, my retirement account dropped almost a third from its previous high! That was enough to get me lighting candles, burning incense, and praying to the patron saint of 401(k)s.
“Saint Ralph”, I prayed, “what is happening to my money?! Here I am, trying to pay my bills, save for retirement, and have a little leftover for some holy wine. What should I do?”.
Here are the answers that came:
Do Not Panic, Child. Chances are good that the market will bounce back up. Even if you’re 45, you still have 15 years before you need to cash in your retirement account. You’ve got time.
I was happy with that answer, but concerned he thought I looked like I’m 45. Next he said:
Do Not Sell, Child. Ralph explained that by getting out now I’d lose the flip side of a down-turn, which is the bounce back up. Values may drop but that’s okay. He said, “Maybe you should consider buying more while the price is lower….”
Fine Ralph, fine. What else?
Take Care of Your Finances, Child. Ralph explained that a 401k is just a portion of proper money-management. To really maximize what you have you need to strengthen the basics: budgeting, debt management, long-term forecasting, and asset diversification. Ralph asked, “What are you doing to satisfy these aspects of your finances?”
I started making a mental list. After all, I work at Geezeo. We live and breathe personal finance! We help people with their money every day. Doesn’t that count for something?
Ralph said, “He only helps those who help themselves” — and then he pointed me to these related articles:
How Wall Street’s Washout Affects Your Retirement
What the Wall Street Crisis Means for Your Money
Wall Street’s Old Guard Regroups [photos]
10 Money Lessons From the Great Depression
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