Most individual 401(k) investors are surprised.
When I ask them about their emotional risk.
How much money are they prepared to lose in their 401(k)?
Not because they’re reckless 401(k) investors.
But because their 401(k) default settings.
The target-date mutual funds.
Never take into account their emotional capacity for stock market losses.
I work with individual 401(k) investors who feel overwhelmed.
Uncertain about tehri current 401(k) mutual fund choices.
Trying to make smart decisions in a rigged retirement account system.
Here’s what I often uncover:
• Their 401(k) mutual funds are 80%+ invested in the same stocks.
• Their stock market risk levels only show up after a stock market drop.
• Their 401(k) emotional blind spots cost them a great deal of money.
There are simple steps to improve your 401(k) confidence.
That means:
• Picking 401(k) mutual funds using clear, evidence-based results.
• Using data from independent, third-party mutual fund database providers.
• Setting a 401(k) “stop loss” to limit future retirement account losses.
Let me give you a quick real-life example.
A mid-career professional came to me with a $400K 401(k).
On paper, it looked diversified.
In reality, it was 85% exposed to the same stocks.
Spread across many mutual funds that moved in near lockstep.
We sold a couple of the highest risk mutual funds.
And set a tight “stop loss” to limit future 401(k) stock market exposure.
It’s not hard.
If you have access to the right 401(k) mutual fund data.
And you are ready to take a close look at the numbers and your emotions.
Does your 401(k) deserve more than cookie-cutter mutual funds?
Let’s connect here on LinkedIn for a second opinion.
P.S. Rebalance your 401(k) mutual funds and your confidence.
