New year - Time to save your 401K

Dow bumped up to the 12.5k limit yesterday and sold a little today. How does that help your 401k? Well, most 401k accounts are designed to buy funds with the expectation of going up... If you are making contributions into mutual funds without regard to the market action, I'm guessing you'll start seeing your account drop over the next couple weeks.
As I've said before, I have my 401K account in a money market fund (cash) - so I don't see any of the up~down action in the market. Does that mean I could miss the next big market move to the upside? Sure does. More importantly, I could miss the big move down. Simply put, I'm protecting my nest egg.
Why do I think this way?
Two reasons:
1) Government debt, and not just the United States. Remember it's a world economy tied to the US dollar and our friends overseas are in a pickle. They owe too much and they're having a hard time getting anyone to loan them money. Much like a game of musical chairs.
2) Regular people are feeling the squeeze. No hiding how expensive everyday items are. Gas, food and basic materials have most of us shaking our heads in disbelief. The economic system is faltering and nobody wants to make needed changes.

My goal for 2012 is simple. I want to make 10% return on my 401k. That's it. Let's not get greedy!

How? The DOW is stuck between 11,300 and 12,500. I'll wait until the DOW get near the 11,400 mark and begin buying mutual funds through my 401K. Let's see what next week brings us...

Europe again

Looks like Europe can't seem to get anymore organized on their finances than the US, Germany tried selling bonds & had a hard time selling any. I really wanted to get in the DOW at 11,300, but I'm still not ready to pull the trigger. Setting on a 10% gain for the year and must be careful.
Gold started to drop w/ markets early, but turned north as the day went along. Gold ended at just below $1700.
Here's the thing. No volume - shows no conviction. All the big boys are raising cash and watching. That's what we'll do for the rest of the week. Watch and wait. Boring but safe...

Dow drops below 11.5k

Really slow market today - light holiday volume and very little news kept the markets in a small range all day. Federal reserve notes mentioned a few members interested in printing more dollars and gold liked that (hitting the $1700 level). I like the DOW 11,500 level and would love to see it drop to the 11,300... however it hung tough at 11,500. I'm thinking about putting 50% cash into small caps tomorrow. I have all day to decide as my order will not be effective until the end of the day.
I'm just looking for a small rally in stocks. I'd be plenty happy with a 2% gain and more than likely I'd jump ship after making my money. But here's the kicker when investing this way... You have to hold that trade until it is a gain. Even when it goes the wrong way, you can't let it become a loser. I'll post tomorrow after the market gets going.

Today's Action

No big surprise from the super-committee. Market gave them a half-spanking and turned their heads back toward Europe.
2% drop in stocks, while commodities took it on the chin. Gold & Silver are looking a little more attractive. Let's see how cheap they can get. Gold @ $1500 would really perk me up.
At this point I'm still 100% cash - Just watching to see if the DOW holds 11,500 tomorrow. Wouldn't be surprised to see a small rally tomorrow, only because we've had several down days in a row. 2% wouldn't be out of the question.
If DOW drops into the 11,300 range.... Afraid I'll have to give some serious thought about buying for a trade. However, I doubt she drops to 11.3K.
Love to get another 2% gain before the end of the year... But let's not get greedy!

Who's watching your 401k ?

I sometimes get the feeling that most people don't like discussing their 401k financial plans. Perhaps they choose to ignore it and hope it will take care of itself over the long run. Maybe they don't find the financial world very interesting and turn a shoulder to global events that can affect their retirement fund.
So the question is: Who's watching your 401k?
First, let's make sure we understand how it works. When you make a contribution at work, you generally have the option to choose from several different funds. They may include:

• Money market fund - Equivalent of cash - very safe, even when stock market is losing...
• Bond fund - You're lending your cash to businesses and governments - fairly safe until interest rates raise.
• S&P 500 fund - Stocks equivalent to the S&P 500 - Good when the S&P are going up.
• Small Cap fund - Stock of smaller companies
  
• Large Cap fund - Stocks of larger companies (WalMart, GE, Ford, etc..)
• Foreign / Overseas - Stock located outside of US (England, Germany...etc)
  

Most people make their choices and are told to leave it alone for the next 20 years. Maybe that's why they aren't too interested in talking about it? I dunno.
I do know that those who manage 401k accounts, charge a fee to track your money. And tracking your account is all they do, unless you ask them to transfer funds...etc. If you make money they charge a fee - If you lose money, yep, you guessed it, they charge a fee. Nobody from your workplace looks at your investment choices. And those folks managing the funds you're invested in - they manage their funds, not yours.
So you're all alone, managing what will likely be the largest sum of money you'll ever have. Your company can't help, the company managing your 401k isn't concerned (except getting their fee) and like everything else, it falls into your lap!
The point is: If you don't take care of your 401k - nobody will.