Prevent a 401(k) Retirement Plan 'Tornado'

Like you, I have spent the last few days on the telephone and in e-mails communicating with
my Golden Valley area clients about from last Sunday afternoon, May 22nd.

Recovery from any tornado damage is a simple process. Every Golden Valley resident who has paid up insurance premiums will receive full coverage on their property loss due to the tornado.

The weather in Minnesota makes every large financial asset you own is always “at risk.” Cars
and homes have certainly been through a great deal of snowy winters and stormy summers the last few years.

The local tornado damage got me wondering how many company retirement plan participants realize that they can take the necessary steps to manage the risk of a substantial loss in their company retirement plan accounts.

The last great stock market decline occurred from June 2008 to March 2009. During that time period, the S&P 500 index lost over 43% in market value. By any measurement, that decline qualifies as a financial “tornado” in a company retirement plan value.

The same insurance against a catastrophic loss on a home or car is available to most company
retirement plan participants.

There is no company retirement plan insurance policy that you can buy to avoid large principal losses in your company retirement plan. But, you can find professional financial advice in a variety of sources that will give you a game plan to follow in the early stages of the next potential stock market decline.

If you are at the stage of your working career that you cannot take on the additional risk
of having to replace a large part of your current company retirement plan account value over the next few years, you should seek professional investment advice on how to avoid the potential for a financial “tornado” in your company retirement plan.

Ric Lager
Lager & Company, Inc.