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BoxingRaptor t1_iy872lr wrote

> I do my own contributions to 401k/roth but haven't done any this year d/t the market. I know you cant time the market or whatever. But being semi-young, I thought I was doing very well with my 75k in 401k/roth. That 75k fell to 60k, then 53k and now it is sitting at 44k. Granted, I only had about 51k of my own money invested but to see a 31k loss hurts.

You didn't "lose" anything. You don't realize a loss until you actually sell. What you ARE doing right now is missing out on buying stocks while they're on sale. If you're investing in target date/index funds, they will bounce back eventually, and you will have missed out on excellent gains.

You have a couple of decades until retirement, so you shouldn't be worried about some temporary dips and dives. I would get back to contributing yesterday.


Badroadrash101 t1_iy89206 wrote

When the share value drops in your fund, this is the time to invest more into the fund. The fund will recover and since you bought shares when they were cheap, you will see a greater return when the fund recovers.


TyrconnellFL t1_iy8edmv wrote

When the share value goes up in your fund, this is also the time to invest more in the fund. It’s going up!

Don’t time the market. Just invest.


Badroadrash101 t1_iy8hl2s wrote

Agreed. It’s that it is very common to see many investors to panic when their fund declines in value as has happened recently. In 2009-2010, my 401k dropped 60% and my coworkers were absolutely freaking out. I maxed out my contributions and benefited when the market recovered. This is a similar junction and if the OP has the ability to contribute more, then he should do so.


NoMoneyAnywhere OP t1_iy87yh5 wrote

Yeah you're right. But with the looming recession, wouldn't it be smarter to wait until they come down further? I get it, I am just gambling regardless, but with recession "96%" likely, wont the stocks just keep dropping?


BoxingRaptor t1_iy88ak5 wrote

Well now you're getting into "timing the market" territory. How do you know for a fact that the market will go down much further, and can you tell me where you bought your crystal ball, so I can get one? Just regularly contribute each pay period, and you will end up in a good place by the time you retire.


nolesrule t1_iy88t18 wrote

Recessions and market drops don't necessarily correlate. We may already have the market drop caused from an expected recession. And when a recession happens, people are often optimistic about the future of the market since "it can only get better" which will cause prices to rise.

Your relationship assumptions between a recession and market drops are questionable at best. Not to mention you have 30+ years to keep the money invested so right now will look like a tiny blip at that point in the future and won't make a material difference in the long term.


Rave-Unicorn-Votive t1_iy89ev2 wrote

> But with the looming recession, wouldn't it be smarter to wait until they come down further?

Come down further? They've been on an upward trend for 2 months.


iclimbnaked t1_iy89p6f wrote

Many people have thought a “looming recession” was coming just for it to not ever come.

What you’re describing is trying to time the market.

If it’s actually 96% likely a recession is coming then that’s already priced into the market today as investors would already know this and take money out now.

Just buy and hold. Time in the market always beats timing the market. Buy stocks and don’t look at their value ever.


Jaysons_Tatum t1_iy8bo78 wrote

The market has already priced in a recession a while ago which is a contributing factor to the poor market. Another major contributing factor is the uncertainty behind inflation. We have already seen a sign that inflation may be slowing per the last CPI report. If good reports continue the market will react accordingly. We are in a situation where bad news = good news for the market. A recession means a rapid deceleration in inflation which would be great news for the market. You’ve already payed for the recession within your 401k. Like everyone else is saying invest now, early and often and don’t try and fuck around. Don’t cancel your vacation cause you need an oil change.


Nagisan t1_iy8bez2 wrote

If you're the less than 10% that can consistently outperform the market via market timing, sure.

If you're like a vast majority of investors, investing early and often is better than trying to time it.


MikeWPhilly t1_iy8cp7z wrote

What happens when you miss rally? There are articles on this but most of hte big gains you see in stocks or investment accounts are from big single day rallies, those days where markets jump 3 or 5% after a string of losses.

You are literally trying to time the market. If it were that easy we would all be millionaires because everybody would buy stock when it is going to jump again. I literally lost a max year contribution 2 months after contributing it in 2022, I get it, But the point is we are young and you shouldn’t be looking at it that way. 401k is something you need to look 30 years down th e road. By not contributing not only are ou missing out on the match but you are missing out on compouning. So no it’s definitely not better to wait until post recession. Take a look at compounding articles and videos people really need to understand it. It’s why so many want out of SS.