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What kind of fees are you paying? That chart does not reflect the market. For instance, if you had invested in a low management fee S&P 500 index find you would expect to have seen a 50% increase over the same period. Image
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Submitted 1 month ago by Buttflapper@lemmy.world to mildlyinfuriating@lemmy.world
Comments
Greg@lemmy.ca 1 month ago
Dkarma@lemmy.world 1 month ago
Dude isn’t in index funds…nuff said. Mine has more than doubled since 2021
LifeInMultipleChoice@lemmy.dbzer0.com 1 month ago
There is a large portion of the population that doesn’t know anything about how 401ks work. They are told there employer will take 3% or such out of their income and put it into a 401k account, and some part of that money will be matched by the employer (varying).
Those who don’t know the market don’t touch the money, it is invested for them. So it is very possible whoever posted this is among those people. It is not always wise on their end, but if a professional can lose money investing large amounts for companies like that, so could an inexperienced person. The annual report for 2023 for my company’s investments saw loses as well. The little money I had was elsewhere so I lucked out on that part.
frezik@midwest.social 1 month ago
This is the actual problem with these types of retirement plans, though. People are expected to know a lot about managing the investments themselves. There’s a whole industry whose job it is to give you bad advice. The real advice is “drop it in a mix of an sp500 index fund it and bonds according to your risk level” and the rest is bullshit.
Poik@pawb.social 1 month ago
Check the vanguard target retirement income fund (vtinx) and other similar funds. There was a dip in 2021 that absolutely destroyed a number of retirements, my patents included, despite being low risk options. Total bond index funds also suffered for some reason, and those are as low risk as you can get. Every other fund I have is doing great, but the ones that are supposed to be safe are not doing great.
tburkhol@lemmy.world 1 month ago
That drop was when the Fed was raising interest rates to stall inflation. Interest rates up, bond values down. But the drop in VTINX was only 20% over all of 2022, where OP is showing 50% in maybe the first quarter.
Incidentally, the sensitivity to interest rates is why I don’t like bond funds. If you buy actual bonds, you get the face value back at maturity, where bond fund are forced to mark them all to current market prices to calculate NAV. IMO, this negates the main “safe” factor in holding bonds.
moseschrute@lemmy.world 1 month ago
I like to go a step further and do a target-date retirement fund. I think Vanguard funds are based on index funds, but they will reduce how aggressively they invest as you approach your retirement date. And the fees are very low.
EatATaco@lemm.ee 1 month ago
If you’re really hands off these are a good choice. But if you are willing to rebalance a couple of times a year, it’s unnecessary to pay the extra fees associated with these funds.
Poik@pawb.social 1 month ago
The close to retirement ones suffered that year. The 2030 target lost 25% in less than a year recently and hasn’t recovered. Ironically, the high risk ones have been less risky during COVID than the low risk ones.
Kalkaline@leminal.space 1 month ago
You need to talk to someone about your risk tolerance. Clearly you’re not willing to accept short term losses and you’re going to be prone to panic selling and holding cash when you could be buying dips. Your risk tolerance does not match your portfolio.
IMongoose@lemmy.world 1 month ago
My Vanguard roth IRA is up 11% since 2020, and is up 30% just this last year. If you are investing into individual stocks yourself I would probably reconsider that strategy. Buying individual stocks is closer to gambling than investing.
scrubbles@poptalk.scrubbles.tech 1 month ago
Yeah idk what they’re doing, it sucks but relatively compared to a full retirement fund this seems more like a lesson than devastation. My retirement is up, and I have a modest risk portfolio. I don’t know what they set as their risk level (if it’s even managed tbh), but the market has generally grown since 2021. The only thing that makes sense with that is individual stocks, and there’s no way my retirement would ever run on individual stocks.
Look at Tesla, 4 years ago everyone said they were stable and a great way to grow money. Now they’re floundering in the EV market now that there’s a ton of competition. You just can’t predict stocks over the course of a retirement. You can predict the market, and essentially the only market bet we make with our retirement is that it will hopefully grow over the next 30 years
Poik@pawb.social 1 month ago
They likely were using a full retirement fund, like VTINX or Vanguard Target 2030 or something like that. All of them tanked in the end of 2021 up to target 2060. Even my shares in the Total Bond Index tanked then, and those are supposed to be as low risk as possible, literally.
bamfic@lemmy.world 1 month ago
What most of the commenters are missing is that the assumption that one has to know how to gamble in order to have a retirement is a broken and stupid USA thing. Nobody should be forced to learn these things in order to not end up on the street. OP clearly has no idea what they are doing-- and so many comments point this out with varying degrees of rudeness, smugness, and shitty attitude-- but the point should be that we are feeding naive investors like these to the lions and that is morally wrong and collectively shortsighted. We all suffer as a society because people like this are being required to make investment decisions and doing that really poorly.
tomalley8342@lemmy.world 1 month ago
TexMexBazooka@lemm.ee 1 month ago
What this graph looks like to me is you made a really shitty bet, lost a bunch, sold at the bottom and then bought index funds and it’s been ticking up since.
Also you didn’t “lose” anything, assuming you didn’t sell. If this is a retirement plan, just keep your head on straight and stick with indexed and dividend funds
PriorityMotif@lemmy.world 1 month ago
[deleted]Zess@lemmy.world 1 month ago
For real. My 401k went from 40k to 85k in the same time period as OP.
partial_accumen@lemmy.world 1 month ago
I lost $4k on my retirement plan. It’s invested in total market funds, some tech, some big cap companies, and healthcare. But every sector has been ravaged by the stock market changes.
Its not your total market fund killing you, its your individual stocks. I don’t recommend picking specific stocks for your real savings. Save individual stock picks for money you can afford to lose. In your case it cost you $7,000.
I used your same data and here’s what it would have looked like if all of it was in your Total Market fund.
You would have $18,679. This would have been a gain of $3479 or a 22% return on investment in only 2 years. That is crazy good! Retirement isn’t a total scam, but unless you are VERY lucky, picking individual stocks is risky. You can successfully save for retirement with just one, two, or three funds: Total Stock Market fund, Total Bond Fund, and perhaps an International fund. I mainly focus on just the boring Total Stock Market fund and it performs fairly consistently well over time.
Dkarma@lemmy.world 1 month ago
This this this. Op is a shit investor using his 401k to buy individual stocks.
Tldr; he’s doing it wrong.
Poik@pawb.social 1 month ago
Stop. The Vanguard retirement funds all did this if the target is before 2060. And those are invested in index funds by professionals. OP likely had the VTINX or a total bond fund, both of which did this that year and were recommended for during retirement. This is likely the more liquid portion of the portfolio, not the penny stock portion.
vxx@lemmy.world 1 month ago
BBY all in yolo!
FundMECFSResearch@lemmy.blahaj.zone 1 month ago
3 years is absolutely nothing in stock market terms. Check in a decade.
xylogx@lemmy.world 1 month ago
You should be continually contributing over time allowing you to benefit from the dips by buying low. This offsets the losses and is called dollar cost averaging,
Johnmannesca@lemmy.world 1 month ago
Yep. Much like northbound travelers in the US South, when we see a low price we buy as much as our tank can carry.
RememberTheApollo_@lemmy.world 1 month ago
Invest in index funds. They are self- cleaning…IOW when a stock stops performing it is removed from the fund and replaced by a better performer.
Use a brokerage that is low fee. Fees steal your money.
Do NOT let someone manage your money that moves stocks around for fees.
Use Dollar cost averaging . Even if the market is down, keep adding regularly. Which is tied to…
Don’t time the market. You can’t win.
Don’t touch it. Don’t touch your money. Don’t incur fees and capital gains taxes. You will lose. Leave it alone.
I am up 8% average yearly over the lifetime of my fund including all the downturns, it has been stellar this year well over 12%. Is this a “get rich quick” way of doing things? Is it exciting? No. Not at all. But it works.
Investing (NOT TRADING) is EasyHard, because it’s really easy to do, but really hard not to mess with and screw it up.
nimble@lemmy.blahaj.zone 1 month ago
don’t touch it
Don’t even look at it on a regular basis. Looking at it makes some people do self-defeating things like breaking your other great points
Mereo@lemmy.ca 1 month ago
My brother or sister, invest in index funds, not in the stock market. And then forget about it for 30 years or more until you retire.
Greg@lemmy.ca 1 month ago
*Index funds with low management fees
golli@lemm.ee 1 month ago
broad market Index fund with low management fees
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tal@lemmy.today 1 month ago
My brother or sister, invest in index funds, not the stock market.
I mean, while I get what you’re saying and don’t disagree, I’d phrase it as “hold an index fund rather than stock in individual companies”. ETFs themselves are traded on the stock market.
Mereo@lemmy.ca 1 month ago
You’re right. I wrote it quickly while on the go.
ThePunnyMan@lemm.ee 1 month ago
You can also do target date funds. Each one indicates the projected year you expect to retire. As you get older, it shifts more to safer investments like bonds. The idea is invest in the stock market when you are young and don’t expect to use the money soon. You are able to hold through downturns in the market and returns have historically always trended up despite the occasional drops. When you are near retirement and expect to be using the money you can’t always afford to wait it out so you should invest in things that are more stable but have lower returns like bonds. Target dates have slightly higher fees and you should always check what the fees are before you invest, but they are very set it and forget it.
Poik@pawb.social 1 month ago
All target date funds through vanguard tanked that year unless you have 2060 or later as the target. 2030 lost 25% and hasn’t yet recovered.
Tygr@lemmy.world 1 month ago
Because you aren’t invested right. You probably clicked that option to allow them to invest it for you and so it picks all the funds with high expense ratios. Mine jumps 20-30% every year.
r00ty@kbin.life 1 month ago
Yeah, I was going to say. Not pension, but I put money into two different blended portfolios (I didn't choose the contents, just the two choices from a list). I started it in Feb 2021 and the overall gain has been over 35%. I have no idea what the pension fund put their money into there, but it seems like some bad choices.
OP should check the options they have.
capital@lemmy.world 1 month ago
JFC. Just buy a target date fund. This post makes it clear that you don’t really know what your’re doing so please do yourself a favor and just pick a target date fund like this (or equivalent if Vanguard funds aren’t available to you) and don’t mess with it until retirement.
If you want to take the time to learn more about what you should probably be doing, here are some resources:
Buttflapper@lemmy.world 1 month ago
[deleted]Jim@r.nf 1 month ago
He’s being “rude” because you’re losing faith in your fund for no reason. Thankfully you have a financial advisor. The problem is not US retirement plans, the problem is it’s only been a few years. If the target date is 2050 then assuming capitalism doesn’t collapse entirely, you’ll be fine. Look at it on the larger time scale that it is. A few bad years is normal fluctuation.
capital@lemmy.world 1 month ago
Because you’ve come to the conclusion that “retirement in the US is a scam” evidently based on a few years of data in just your portfolio. Retirement savings is built over decades.
sudoshakes@reddthat.com 1 month ago
If your portfolio was a Fidelity target date fund, it would not be impacted by the local industry you mention in your post.
I also happen to know more about the details of how our retirement fund recommendations to clients works at Fidelity… because I worked there for the last 5 years.
You are showing the results of poor selection on your part.
vxx@lemmy.world 1 month ago
How did you manage to lose money on a 3 fund portfolio, if one of its strengths is that it never underperforms the market?
Something doesn’t add up. Sounds and looks like you gambled first and then went with a solid investment.
CafecitoHippo@lemm.ee 1 month ago
But every sector has been ravaged by the stock market changes.
You just don’t know what you’re talking about. The S&P 500 is up like 25% over the same period. You’re just buying into specific sectors. Don’t do that. Buy market index funds or target date funds and stop trying to actively manage your retirement account. Also, you haven’t lost anything in value because you haven’t realized the losses by cashing out. It’s better for you currently if things are a lower price because you’re buying them at a discount.
Korne127@lemmy.world 1 month ago
The stock market averages are only true if you look at it for a really long time, like 30-40 years. In 10 years, the value can definitely go down a lot, but if you view it for the long-term, it will still be an improvement.
I understand that looking at it like that is unnerving though.
spankmonkey@lemmy.world 1 month ago
Needing to choose when to retire based on whether the stock market is up or down is a dogshit system.
SynonymousStoat@lemmy.world 1 month ago
That’s generally why when you’re younger people tend to put their retirement funds into riskier investments and over time as you get closer to retirement you move portions of your money into less risky things that don’t have the potential volatility of the stock market so that by the time you retire you don’t have to worry about the stock market dipping and blowing out your retirement funds. At least that’s one way to do it; obviously this isn’t investment advice and you should seek your own professional investment advice.
ryathal@sh.itjust.works 1 month ago
You don’t have to choose, just keep saving and investing for 30 years.
Placid@lemmy.world 1 month ago
I’m in a Vanguard target fund and I’m up 7.8% over the same period. There was a lot of red until December 2023, when it broke even. All gains are pretty much from this year looking at my returns chart.
socsa@piefed.social 1 month ago
Yeah there is something else going here. No domestic markets are actually down in this interval. OP must have bought some individual stocks.
protist@mander.xyz 1 month ago
Or be invested in managed funds with high fees that are performing poorly vs index funds. My 403b is definitely up over this same period, but I’m only in index funds
IHawkMike@lemmy.world 1 month ago
Buttflapper@lemmy.world 1 month ago
Which funds did you invest into? I’ve studied like 25 hours of investing. Haven’t found a good fund yet except FSKAX and VTI
partial_accumen@lemmy.world 1 month ago
You found the good ones. No need to go looking further.
CmdrShepard42@lemm.ee 1 month ago
I’m in BTC S&P 500 Index, BTC Russell 2500, BTC ACWI EX US IMI, and BTC US Debt and am at 11.93%, 3.6%, 3.87%, and -1.34% over the last 3 years. Over the last year though, it’s 36.36%, 26.36%, 25.22%, and 11.6%. My funds are Large Cap Blend, Small Cap Blend, Foreign Blend, and US Bonds at roughly 67/7/20/6 percent division of my portfolio.
I think you just got into the market at the height of the markets during COVID and are still digging your way back out. You could try diversifying a little bit in a similar fashion to spread the gains and losses out a bit over both large and small US companies and foreign markets.
GuyDudeman@lemmy.world 1 month ago
I let my bank’s financial advisor handle that. They have apps that calculate everything.
ultranaut@lemmy.world 1 month ago
If you have an account with Fidelity, FZROX should be a better choice than VTI. Unless you enjoy investing or want to really get into it, either do a target date fund for the easiest and lowest risk, or a total market fund like VTI, or an S&P500 fund like VOO. You really don’t need to overcomplicate beyond that, except to potentially start buying bonds when you are nearing retirement if you didn’t choose a target date fund.
Placid@lemmy.world 1 month ago
Mainly VFFVX, which is up 4.46% over a 3 year period, but I have about 20% in various other funds.
Mozingo@lemmy.world 1 month ago
I’ve put my ira into FNILX. Zero fees and consistently beats 10%
Poik@pawb.social 1 month ago
Poik@pawb.social 1 month ago
Okay… I even came with receipts on this one. Am I just annoying? What’s with the downvote, even on ones where people are suggesting target date funds? The fund will bounce, it’s just a huge dip for one that was supposed to be, according to professionals, safe for retirement use. So sure, I can see the downvote as disagreeing with sensationalism, but I was contesting the suggestion that no funds dropped in that time. If it’s because I got spammy, sure… I assume most people don’t reread the other comments after the first time they go through, but I can stop.
For reference, target date funds are still usually good, but total stock index is always better in a ten year period, so whether they are actually worth it is questionable.
hedgehog@ttrpg.network 1 month ago
Understandably frustrating, especially if you’re new to investing. But it’s expected that the market will have both ups and downs.
The best advice I can give is to choose a good investment allocation and then stick to it. Contribute as much as you can each pay period or month and avoid looking at your balance as much as possible. You should figure out a rebalancing strategy, and you’ll probably need to look at your account to do that. Also, see The Best Order of Operations For Saving For Retirement.
Right now you have unrealized losses, but you haven’t actually lost any money (i.e., you have no “realized losses”) until you withdraw it. As it’s a retirement account and you just started it, I assume you aren’t planning to retire in the next decade, much less the next three years.
Is this your only retirement account? If so, why have you not been continuing to add money to it? If you wait to do that until the market recovers, you’ll lose out on all the gains between now and then.
I know you haven’t said you’re considering selling, but I recommend you check out the “Maintain Discipline” section of the Bogleheads investment philosophy, just in case that’s on your mind. I also recommend that you read up on dollar cost averaging (if you’re investing in a retirement plan every pay period, you’re already doing this).
You pointed out that the entire market has been impacted. I haven’t personally been paying attention in enough detail to confirm that (and my accounts that I just checked have gone up about 10% over the past three years, not down), but if so, that means you could change your asset allocation without selling low and buying high. I’m not saying you should change it, but if you take the time to learn about different investment strategies and decide a different one works for you, it’s nice to not have to sell your current investments while they’re underperforming relative to your new investments. (On the other hand, you can always change the allocation for your future investments without worrying about that.)
Treczoks@lemmy.world 1 month ago
Don’t worry, the money is not gone. It is just with someone else, probably one of the billionaires.
Tabooki@lemm.ee 1 month ago
How did you manage this. The market has been up every single year since you started.
foggy@lemmy.world 1 month ago
Tech is a wild ride.
Index funds are boring but not stable.
S&P 500 is always a good bet.
GBU_28@lemm.ee 1 month ago
Skill issue, total market is up
Tedesche@lemmy.world 1 month ago
Because you invested in a shit plan or simply made your investments poorly. I know plenty of people who are doing well on their retirement investment plans, and I’m doing fine too. Don’t blame America, the country, for your shitty decisions.
corsicanguppy@lemmy.ca 1 month ago
This is what we call Survivor Bias.
Tedesche@lemmy.world 1 month ago
LOL. Omg I’m such a survivor. I’m only a survivor because I survived this long. I would be a completely different person if I I just survived longer than this. 😝
viking@infosec.pub 1 month ago
3 years is nothing. Stocks move.
ultranaut@lemmy.world 1 month ago
What specifically are you invested in? That chart doesn’t look right if you are investing as you describe.
AdamBomb@lemmy.sdf.org 1 month ago
Dollar cost averaging, son. Good time to buy!
plz1@lemmy.world 1 month ago
If your portfolio is down that much over that period of time, you are likely not making good investment choices. S&P500 is up like 50% since 2021…
Your losses or lack of portfolio growth isn’t really something to complain about online without more info on what your asset mix is. Unless your goal was just to complain, and not get any advice from helpful anons that are having more success in investment choices.
It’s invested in total market funds, some tech, some big cap companies, and healthcare
Tech, big cap, and healthcare are already part of the total market funds, so you’re over-weighting (taking excess risk) by investing that way. Assuming you’re pretty young based on time in market, you’d be fine with just the total market fund, until you have more experience with the market or just want a set and forget, for a while.
Mac@mander.xyz 1 month ago
Retirement is a financial state. Set a goal and work until you get there. Diversify your investments and basically just ignore the market.
Unless there is a total collapse of the economy you’ll be fine and if there is a total collapse it’s unlikely you were in a position to captialize on it anyway.altima_neo@lemmy.zip 1 month ago
Yeah my 401k basically didn’t budge for years even though I was dumping money into it.
TexMexBazooka@lemm.ee 1 month ago
You need to revisit your allocations
bitwolf@lemmy.one 1 month ago
You put 15k immediately in?
That sounds stressful.
If so, I feel it would be better to put 15k into your account but purchasing in 1k a month increments. It would have flattened that dip for you.
Appoxo@lemmy.dbzer0.com 1 month ago
I started by putting a good amount of money in first with the goal to the the average later on.
I mean what should you do with spare 15k other then investing it somewhere.
Yes, yes you could diversify…
Catoblepas@lemmy.blahaj.zone 1 month ago
Not saying that’s not frustrating, but don’t fixate too much on the ups and downs of it if you’re not set to retire soon. What the stock market is doing now is barely going to impact the value of your retirement fund in 20, 30, etc years.
GuyDudeman@lemmy.world 1 month ago
Retiring on $15k is a scary fucking thought.
spankmonkey@lemmy.world 1 month ago
$11k
Blue_Morpho@lemmy.world 1 month ago
The OP is missing something. The two specific funds of his 5 holdings that he said he bought are both up. The 3 he didn’t provide specifics are up too.
$15k should be all in Vanguard total market index. Smaller funds are riskier and could take decades to show their greater returns.
Omegamanthethird@lemmy.world 1 month ago
Also, if they are look at the ups and downs, hopefully they invested when it hit the dip.