That doesn't mean that your funds will never lose money. Stocks go up and down in the short term, but the long term trend is up. Your 401k has some target date funds. These are funds that have the right mix of stocks and bonds (and other investments) to match what experts think are the right amounts of risk for the year that you're scheduled to retire. If you're 30, you're scheduled to retire in 35 years (age 65), which is 2049 The investment mix for a 2049 target date fund will be different from a 2019 target date fund, which would be for someone who expects to retire in 5 years.
You don't have to get the year exactly right. The differences of a few years make very little difference. These funds allow you to automatically create a balanced investment that is appropriate for the year you plan to retire. It saves you from having to work out your own portfolio mix.
I'll add one bit of advice. Stocks go up and down (so do other investments, but I'll talk about stocks only just to keep this short). You want to buy low and sell high. Over time, stock prices go up overall, but there are short-term fluctuations. If the market takes a dip, don't suddenly get afraid of stocks and sell all your funds. That's selling low. Stay the course. Don't move out of stocks when the market drops and move into stocks when the market rallies (goes up suddenly). That's the opposite of what you want. Buy the funds and leave the money in there, even as the market fluctuates. Don't check your balance every day . You'll just drive yourself nuts.
Your 401(k) custodian should offer you a variety of investments, ranging from the ultra-safe (but low return) to the more aggressive growth-oriented stock mutual funds. You pick what you want to invest in (which can include a mix of investments).
Yes, the more aggressive choices can lose money. But, if you're young, the losses will usually be short-term, and you'll be better off in the long run by making the more aggressive choice.
You pick where the money goes out of the list if investment options they provide. And yes, depending upon how well you invest (or how badly) you can lose money.
you choose the investments,,, you have complete control,,, you get a quarterly statement in the mail,,, you can also sign up to see it online
"so can you lose your money"
absolutely, but for the most part you've only lost tax-free money.
Seriously, are you 12 years old?
I understand you basicly just give money to your company and they tell you it's in a 401k now. But what are they doing with the money?
If they invest it who picks what they invest in? Can't they lose money by investing too, so can you lose your money?
