The sky is falling! What should you do with your 401K

The stock market is choking on millions of dollars in bad debt. Paulsen wants to infuse a $7 Billion dollar bailout, but the Bill was killed in the Senate due to partisan politics. The return on my 401K investment this year is a dismal -29.6%. A lot of people are panicking. The question is what to do.

If you are not close to retirement age then you can actually benefit from this market downturn. A majority of the stock market took a big hit on Monday. If you continue to contribute as you were, you will be getting more stock for your money. When things turn around, and believe it or not the economy will eventually improve, you'll be fine. At least this is my reasoning and what I plan to do. If you have a better idea, let me know.

If you are about to retire you are screwed especially if you had all your money in the stock market. Again it may take some time for things to turn around (I'm guessing 3 to 5 years) and if you can't wait out the depression, get your money in safer investments like bonds.

On a side note my bank Wachovia was purchased by Citigroup. I am interested to see what will happen. I'm not afraid of losing any money, but I hope Citigroup knows what they are doing.

I am not worried.

Adventures in Stock Picking

My stock market experience update: a few months ago I sold my shares of MEDX for a $9 profit, which includes all brokerage fees. I also jumped into two other stocks a small cap SDTH, which I think has some real potential, they have a good balance sheet, and a cheap dollar stock call XCR. XCR I bought into the hype and will probably lose some money. It's a company that makes equipment for dialysis, including a portable dialysis machine. It is fun checking the quotes.

In related news my 401K is atrophying this year, already down 24% not counting yesterday's blow to AIG. I just glad I have a long investment horizon and am not planning on retiring anytime soon. I still think I'll be on track to reach my goal of $30,000 in my 401K by the age of 30.