Investment Planning & 401k Advice. Financial Advisor Help in Benton Washington County AR Arkansas

www.PinnacleHillsFinancialServices.com

There are over 42 million Americans that are trying without much success to manage their 401k and retirement savings on their own. Two recent studies on 401k plans and 401k plan participant behavior revealed some startling statistics.

• 89% of people who participate in a retirement plan experienced a negative return in 2008. The average balance declined by 28.3% in 2008

• 82% of employees find that where to invest and what funds to use to be the most confusing aspect of their retirement plan.

• The average retirement plan balance has only increased 13.9% since 2002 even with contributions from both the employee and employer.

• Even with the market turmoil in 2008, only 19.6% of participants made any changes to their investment mix.

These results are definitely eye-opening and make managing the funds in your retirement account more important. The buy and hold strategy is the most popular investment strategy for retirement plan participants, because it is the easiest. I´ve actually renamed this strategy the buy and hope strategy, because you pick the mutual fund names you recognize in your retirement plan and you hope for the best.

In the years that I have been helping people manage their retirement plan accounts I have found what works and what does not. I have found what people want and what they don´t want. But the most important thing I´ve learned is that I know what retirement plan participants need in order to make better investment decisions on their retirement plan assets.

The biggest question that a retirement plan participant has is:

"Where do I invest in my retirement plan today?"

You notice the question has nothing to do with what the stock market did last year or what it will do next year. It has everything to do with where to be invested right now. The last thing that retirement plan participants want is predictions from some computer generated historical model.

Let´s look at some indicators that may help you make better decisions for your retirement plan funds.

Point and Figure Method

Charles Dow is the creator of this method of charting. He developed the practice of charting stock price movements. At the end of every day of stock market trading, Dow "figured" a picture of the price movement of the stocks he was interested in. The purpose of these charts was to present an accurate picture of the buying and selling of each stock. If there are more buyers than sellers, the price of the stock will rise. If there are more sellers than buyers the price of the stock will fall. If there are about an even amount of buyers and sellers then the price will stay basically the same. This is the law of supply and demand. It is irrefutable. The same reasons that cause gas and groceries to rise and fall cause prices in stocks to rise and fall—the law of supply and demand.

Everything you need to make an informed decision on whether to buy, hold or sell a stock or mutual fund can be found in the Point & Figure chart method. It does not matter what the outlook for the market is, what interest rates are doing or who won the last Presidential election. What matters is if there are more buyers than sellers or if there are more sellers than buyers. This answers the question of "when to buy" and "when to sell", but what about the question of "What to buy?"

Relative Strength

Relative strength is the investment tool that answers the most basic question that every retirement plan participant has "Am I in the right mutual fund at the right time, or am I in the wrong mutual fund at the wrong time?" Relative strength tells you whether the trend of a stock or mutual fund in your retirement plan has been up or down and if that trend is likely to continue. Knowledge of this indicator will allow you to own the mutual funds in your retirement plan that are outperforming and avoid the ones that are underperforming. The best thing about this indicator is that it is unbiased and unfiltered.

Conclusion

First, you need to know if the stock market is going to allow you to make money or if it is going to take money away from you. Second, you need to know which funds in your retirement plan are in favor and which ones are not. It may be Growth or International or Small or Mid Cap funds, but it probably will not be what a computer model predicts it will be.

For more information or a complete review of your investment choices inside your retirement plan please contact Braden Hill at 479-631-9700 or visit www.PinnacleHillsFinancialServices.com.