Just when we thought it couldn’t get any worse, more companies are suspending their 401(k) match. A challenging economy is often cited as the reason for this decision.
The alarm bells went off last week when GM stopped their 401(k) match in order to conserve cash and survive this downturn/recession. I don’t think it will be long before more companies take GM’s lead and eliminate their match as well.
Prior to GM Goodyear, Frontier Airlines, Cushman & Wakefield, Entercom and Dollar Thrifty made the decision to cut their match.
Do you think this will hurt morale and decrease productivity?
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The Dow has been a roller coaster ride over the last few weeks. Many of us have seen our investment portfolios PLUMMET! I am certain we are all crossing our fingers/toes/arms and rubbing our rabbits’ feet to see if this upward move can sustain for a few days.
I have to admit, I began to panic a little on last week, though I didn’t make any drastic moves. I am surprised at the number of people who decided to withdraw their funds completely-despite the huge penalties and the future damage caused to their long-term investment strategies.
I even considered the withdrawal options, but during my contemplation I reached out to my financial advisor, here was his reply:
With regard to your investment strategy, our firms approach to investing is that of a ‘long-term, buy-and-hold’ strategy, particularly when there are many years between now and retirement.
I have reviewed your holdings and while we have seen significant drops in value consistent with the overall market decline, I do not recommend any changes at this time. History has consistently shown that major market declines and recessions are followed by periods of economic expansion and market growth. Only by staying invested and avoiding market-timing decisions can the real long-term average returns of the market be realized.
Did you make any major changes to your portfolio?
Are you considering more changes?
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