Many future retirees lost a significant share of their 401(k)plan balances during the economic downturn during 2008 and early 2009.To reduce the chance of a significant reduction in your 401(k)account balance as you near retirement,financial planners suggest that you should

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Financial planners suggest reducing the proportion of common stock in the account to reduce the risk of significant losses as you near retirement. Common stock is generally riskier than other investment options, so reducing that proportion will help protect your overall balance. Increasing the amount of company stock held in the account or investing in riskier stocks can actually increase your risk of significant losses. Beginning to take distributions before age 60 may not be feasible for some and could potentially result in penalties or taxes.

Many Future Retirees Lost a Significant Share of Their 401(k)plan