I am panicking on how I’m loosing money on my 401k. I have a feeling recession will be next and I will lose it all. Should I withdraw now but pay that huge penalty but at least have enough to pay off my house?
5 replies (most recent on top)
"No. Don’t do any of the things you mentioned or take any advice commented."
He should only listen to you, because your financial outlook and objectives are exactly the same as his?
You think you are helping but you are not. I could just as easily say, "look up dollar cost averaging myth". The best advice here is the oldest comment.
No. Don’t do any of the things you mentioned or take any advice commented. Contribute as much as you can to your 401k while it’s down. Look up dollar cost averaging. The company match is nice here even though you could probably get better total compensation by going to a different company.
Don’t know your specifics (current age, risk tolerance), but if you haven’t retired cashing it out with the 10% penalty and taxes on the remainder could be a huge $ sacrifice. 401k should be for retirement, but certain life “happens” moments can quickly change that, but the penalty and tax on top of that can be significant. Find a fee only financial advisor (one is Garrett Financial Network), they are fiduciaries and pay for their advice before doing anything drastic!
HODL
You can adjust your 401K allocation to reflect your risk tolerance. Ask Fidelity to assist you. There are only a few scenarios where you want to pay off your house - you are likely better off with a mortgage at a low interest rate.