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Any 401K investors who luckily started investing in around March 2009..?


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2013 Mar 14, 2:48am   2,673 views  9 comments

by BoomAndBustCycle   ➕follow (1)   💰tip   ignore  

There's gotta be a lot of 20-30 year olds who started investing in their 401K accounts in March 2009... and in 4 short years.. have more than doubled their portfolio. That's some pretty impressive returns.

Curious how this will effect your average non-finance minded 20-something. Will they think doubling your money every 4 years is the NORM?

#investing

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1   BoomAndBustCycle   2013 Mar 15, 1:43am  

SFace says

That is bad. A 20-30 year old does not have much of a balance. doubling your 10K is 20K. It is falling behind.

How is that bad? Gotta start somewhere... and doubling your 401K money in 4 years is a great start to a retirement fund. Especially if your company is matching! Then your 401K money is coming from your employer.

2   Tenpoundbass   2013 Mar 15, 1:43am  

BoomAndBustCycle says

There's gotta be a lot of 20-30 year olds who started investing in their 401K accounts in March 2009... and in 4 short years.. have more than doubled their portfolio. That's some pretty impressive returns.

Curious how this will effect your average non-finance minded 20-something. Will they think doubling your money every 4 years is the NORM?

We'll never get out of this world alive, and you'll never retire from your job rich. Do you have any idea, how many Seniors are still working, because 2007-08 erased every penny they had in their 401K.

It's an evil insidious diabolical scheme, you can't take your money out with out getting penalized on top of being taxed outrageously. And yet, all you can do is watch it diminish every time the Fed does something stupid, or the President fails to improve economic conditions.

Fuck that, pay me my money at the rate I am willing to work for, and I'll provide my own damn investment venues, ones where I can do as I see fit with my money with out being punished.

As for 20 someodd year olds, non of their chapters are finished being written. When I was in my 20's, all of the guys that looked like they were going to be set for life, while I was couch hopping. Are now in rough shape, mostly due to the economic dynamics of how they made or had money 25 years ago, has changed. Now they lost their niche, and are lower on prospects than they had back then.

3   BoomAndBustCycle   2013 Mar 15, 2:37am  

SFace says

25 year old double their money from 10K -20K.

A 65 year old double their money 1M - 2M.

Great for the 65 year old, but the doubling of the 25 year old money is meaningless in the overall scheme of things. You agained 10K, but a whole class of people gained 990K. That is falling behind.

Wrong, the 65-yearold is basically at break-even... If you have 1 million in the stock market in 2007... and the market drops in half.. and it goes back up to break even in 2013... how did the 65 year old DOUBLE their money?

The only way a 65 year old could double their money is if they sold at the peak in 2007... liquidated their portfolio... and then sat out the market til March 2009 and then re-invested EVERYTHING.

That's some amazing market timing!

It's hardly meaningless.... for the 25 year old to double their money... ever hear of a thing called compound interest?

4   BoomAndBustCycle   2013 Mar 15, 2:40am  

CaptainShuddup says

Do you have any idea, how many Seniors are still working, because 2007-08 erased every penny they had in their 401K.

What about all the seniors that just stayed put in the market and didn't panic sell.. I think they are at break even.

5   mell   2013 Mar 15, 2:56am  

I bought stocks hand over fist in 2009, but I switched back to trading mainly biotech as I don't want to be so dependent on the market fluctuation. It was a nice run, but not enough for retirement or ditching your full time job - oh, and I never owned bank or real estate stocks - I call it conscious trading, no need to sell your soul to the devil ;)

6   mell   2013 Mar 15, 3:00am  

BoomAndBustCycle says

Wrong, the 65-yearold is basically at break-even... If you have 1 million in the stock market in 2007... and the market drops in half.. and it goes back up to break even in 2013... how did the 65 year old DOUBLE their money?

Correct, the seniors who didn't sell are just at break even now. You could say they made some gains from former years as the Dow was well below 14000 when they started their 401Ks. But when you take the debasement of the dollar into account, those gains are paltry - if at all. Inflation is a bitch.

7   mell   2013 Mar 15, 3:05am  

SFace says

The same person with 1M in their 401K would never need to contribute again, their gains would squash the contibution and your 10K gain.

Ok, but they likely had 1M before 2008, then 500K, and now 1M+ again. Unless they were awesome and cashed out in 2007 and reinvested in 2009. If they already had 2M in 2007 they should have moved some into safer havens long ago. 2M is too much to have it all in the stock market, unless you're a diversified fund/trader.

8   saywhatyouwill   2013 Mar 15, 3:09am  

I was in my late twenties in March 2009. Because of the timing of a job change in 2008, I had set up my direct deposit to max out my 401k in the final 3 months of 2008. I forgot to change the allocation in January 2009 and ended up maxing out the 401k in March 2009. I changed jobs again in March 2009 and moved my accumulated funds to a 90/10 IRA.

So, in my IRA, I have approximately 4 years (2006-2009) of "maxed out" 401k funds originally purchased before and in the midst of the bubble. According to the IRA, I put in $57k from those years and now "have" $85k. Not double returns because I did lose a hefty chunk of what I invested in 2006-2008, but I can't complain.

I don't expect those same returns ever again. I actually plan on about an average 3% to 4% annual return. I think I will be lucky to see an average return of 5% through the next 30 years.

9   david1   2013 Mar 15, 5:35am  

Turned 30 in March 2009.

Not 401k, but in a taxable trading account I started buying stocks in Feb/March 2009.

They went up around 25% in 3 months and I thought it was too much too fast so I sold. Whoops.

Then started reading Austrian voodoo and shorted treasuries via TBF/TBT. Lost what I had gained plus a little over the rest of 2009 and into 2010. Whoops.

Ever since have been long US stocks, particularly banking, energy, and tech. Its been a nice ride. Using Buffett's strategy of buying when others are fearful -notably BAC, BP, JPM, RIMM, now AAPL and as of today, INTC.

This rally is nowhere near over. Stocks are still relatively cheap. Retail investors are only now starting to come back into the market.

Anyway, my taxable account has beaten my 401k pretty handily since early 2010. 401k is restrictive in what to buy. Mutual funds only and even then only a handful. I focus on small cap value/growth there.

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