So, I am looking at my 401(k) balances.

My YTD losses are now down to $3K. Again, I'm trying not to lose my shorts if the market takes another nosedive. And I'm planning to retire in a year or less.

Current investments:
US bond index 28%
S&P 500 index 33%
Intl stock index 8%
Russell 2000 idx 3%
Global bond fund 11%
Divers.real asset 5%
Stable value 13%

The global bond fund and diversified real asset fund are actively managed.
The "stable value" fund is currently returning 2.8%/1 yr, 0.66% YTD.

This is just what's in my 401(k). My IRAs and non-qualified accounts are much more heavily in stocks, although a good portion of that is in non-US markets.


And the question has two parts: Should I change my current investments? Should I change where new contributions go? Currently contributions are distributed into about the same percentages as the current balances.


Thanks. This stuff makes my brain go numb.

I'm no financial whiz, but I do usually have a pretty good handle on the zeitgeist. I think it is reasonable to anticipate that markets will tumble again when covid comes roaring back at the end of the year and we're in no better a position to fight it. Also this election will likely cause some market turbulence. I'm waiting for the big correction that I believe is bound to come before getting back into stocks. (I got out a while ago.)

If you are nearly back to your best position and you want to try to time the market, sell now and wait until the bottom falls out to get back in. OTOH, it sounds like you can afford to ride out whatever happens. Maybe just reallocate to the stock/bond/real estate balance you want and forget about it.

My .02 - if you're selling your house in the near future and thinking you might need bridge funding or need additional capital, I might start keeping more liquid savings.

PJ by the looks of it that's a pretty conservative portfolio already.

Based on the balance range you shared and the additional guess that the 401k is the bulk of your portfolio, I bet your total portfolio throws off between 1500 and 2k a month in cash (incl dividends but not cap gains on the funds).

Assuming that guess is right, you can live - not just squeak by - on pension + portfolio cash, more or less indefinitely without touching principal.

Can you check that and see if it's true? (specifically, the amount of cash that your portfolio throws off per annum - don't just check a quarter because many finds pay much more in one quarter than others). Compare that number to a 'normal' level of expenses. I'll bet its pretty close.

And you have so many plan Bs. THere's the option to work, there's being extra frugal for a while if necessary, there's taking SS early if need be, when push comes to shove, there's selling the house.

You seem to be in good shape. But do check the cash per the above.


Maybe as an additional cushion you could redirect your savings into cash, at least until you have an amount that, when combined with your pension would cover your 'normal' life for a year or even more.

I didn't address the market bit.

Yeah I think it's too sanguine about a second wave and the current level of civil unrest. But I would question your ability to time this. It was one thing to sell in late feb, but who thought we had reached a (local) bottom already on March 23rd? I didn't.

So I would counsel against market timing. You should be in a position to wait out any dip. By which I mean be in a position where you can live off pension and the portfolio's cash and not touch any principal. (subject to the verification above)