I wrote this article on September 2, 2011 on my Golden Valley Patch Blog.

Why aren’t Minnesota companies consistently hiring new workers when there are plenty of qualified workers seeking jobs?

Why aren’t Minnesota home sales trending higher despite new record all-time low interest rates?

Why aren’t the stock prices of Minnesota companies attracting new investors despite another summer GARAGE SALE stock market decline?

From what I hear from company retirement plan participants that I meet with, the answers to these three questions are all the same. In today’s uncertain economic environment, people are much more focused on what they can lose now rather than what they might gain later.

Today, I find that most working people are focused on preventing further losses of their financial assets, rather than trying to take on additional risk to maximize any future gains in their financial assets.

The combination of unemployment, housing and stock market events since 2008 have forever changed the way the current working generation looks at the largest investments of their lifetime—their company retirement plan account and their home.

The first rule of investing is to keep what you have. The only way to consistently keep the money you have is to consistently manage the risk on the money you already have.

The vast majority of investors are able to make and contribute enough money to their company 401(k) over their working lifetime in order to pay for a secure retirement. Along the way, the biggest mistake they make is taking too much risk with the money they accumulate.

Ric Lager
Lager & Company, Inc.

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