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6 Months Later How Has Meddling With my 401(k) Fared

//6 Months Later How Has Meddling With my 401(k) Fared

6 Months Later How Has Meddling With my 401(k) Fared

Approximately 6 months ago I came up with a nonscientific plan for my 401(k).  At the time I felt that the market was reaching a high it had to come down from and I should put my contributions into cash rather than my balanced portfolio.  I would then allocate the cash reserves when the market corrected itself or took dips.  If this sounds like marketing timing…it is, and it is not a long term strategy for my 401(k).  Notwithstanding, since I have been doing it and since I always want to hold myself accountable I should share the results.

Market Timing with my 401(k)

I have said it in the past, but I am not a particular fan of my 401(k) choices, but since I am getting a match it is what it is.   The choices are expensive but overall I am in four funds:

  • RGACX – American Funds Growth Fund R3
  • OPSIX – Oppenheimer Global Strategic Income
  • OPGIX – Oppenheimer Global Opportunity
  • CRSXX – Oppenheimer Cash Reverses
  • CGRWX – Oppenheimer Value
  • QVSCX – Oppenheimer Small & Mid Cap Value

So for the past 6 months or so I put my contributions and match into the Cash and Strategic Income Fund selecting when to pull it into the market.  Most of the time I would spread it among the above funds evenly but one or two times they were top heavy to one or two funds.  I wish I did it a bit more strategic in terms of how to allocate so I could really measure if I had a positive impact.

401k returns

In case it isn’t clear from the picture between 11/6/2014 and 5/28/2014:

  • RGACX – 2%
  • OPGIX – 5.74%
  • CGRWX – 7.53%
  • QVSCX – 7.67%

If weighted equally the average return would have been 5.735% and the median return would be 6.635%.  My actual return was:

Actual Return

 

While an extra 1% over the long term could be the difference of tens of thousands of dollars over the course of my working career I don’t think this is a long term plan as I already reallocated my future contributions to a much more balanced approach.

 

Do you ever market time within your 401(k) or retirement account?

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By | 2014-05-29T23:52:21+00:00 May 30th, 2014|Qualified/Retirement|8 Comments

About the Author:

Evan is the owner of My Journey to Millions which was started to track his journey from a broke debt ridden law school graduate to building a positive balance. Need more Evan? Follow him on Twitter, Contact him or get new posts directly to your email

8 Comments

    • Evan May 31, 2014 at 4:46 pm - Reply

      HAHAHAH although if you had left your 401K from that post forward you probably doubled your money LOL

      • Lazy Man and Money May 31, 2014 at 5:41 pm - Reply

        Yeah, I don’t know what would have happened with the drop in 2009 and the recovery. I left the job and consolidated a few 401k plans into a rollover IRA and that relatively diversified.

  1. My Dividend Pipeline May 31, 2014 at 8:43 pm - Reply

    I’ve tinkered with my 401k so many times over the last 10 years that I finally just went with a standard 60/40 S&P Index 500/bond permanent portfolio. Solid long term returns with low fees and I sleep well at night.

    MDP

    • Evan June 1, 2014 at 8:55 am - Reply

      MDP,

      My 401K is frustrating b/c it is filled with expensive funds (1%+ in fees), but my match makes it worthwhile.

  2. Zee @ Work-To-Not-Work May 31, 2014 at 9:51 pm - Reply

    Interesting experiment. Was there any particular criteria that you used to determine when you thought it was a good time to invest your cash?

    • Evan June 1, 2014 at 8:58 am - Reply

      Zee,

      Unfortunately, No lol. I would just shuffle over some cash every time I noticed the market was noticeably down in comparison to the prior few days or week. Very unscientific.

  3. AT September 1, 2014 at 10:20 am - Reply

    At least you can track your funds online. My 401Ks/403B have always used mutual funds that you’ll never find a ticker for. So I always stuck to using the index fund in the group. At least I can get a real picture of what’s happening with my investment.

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