Oct 8, 2008 8:56 am US/Eastern
Planners Say Stay The Course On 401K
PHILADELPHIA (CBS 3) ―
Mary Dougherty has spent 30 years working and she looks forward to retiring. But after looking at her 401k account recently she became worried.
"I was pretty horrified. It's down 40 or 50 percent," says Dougherty.
Dougherty was one of the many people that called their financial advisors for help. Kent Addis with the Addis & Hill Financial firm in Wayne says he's fielded calls from many worried clients including Dougherty.
"Clients are scared. Clients are really concerned," says Addis.
The biggest dilemma for people is making a decision. Many wonder if they should move their money, decrease their contribution, or stay the course. Christopher Coyne, a financial professor at St. Joseph's University, says in the majority of cases people should leave their 401k plans alone.
"If they touch things and make other investments, what they've done is accept whatever loss has occurred," said Coyne.
Coyne says people planning to retire soon or already in retirement have the most to worry about.
"It wouldn't surprise me to see retirees returning to the work force at some level," said Coyne.
401K plans are the main source of retirement coverage for most Americans. Many wonder if their accounts can recover in time for retirement.
"I think I'm like a lot of people you're in a 401k plan. You're in a 40k plan and it's hard to know the direction to go in," says Dougherty.
But she says she will wait the market out and leave her 401k plan alone for the moment She agrees with the experts that moving the money would be a big mistake.
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