13 January 2005
Which is an odd phrase coming from me, since for most of my life I'd never thought of myself as having any assets worth managing.
Historically, I have done no worse than breaking even on the 401(k) while others around me were foundering, which I attribute to careful hedging. (I have contributions split among four investment options and still have holdings in two others to which contributions are no longer being made.) As a fan of at least partial Social Security privatization, I reasoned that breaking even would not impress opponents of the idea, which led me to this not-too-startling decision: don't change investment options this time around, and put your money where your mouth is already.
So I left things alone, and was rewarded with a return of slightly over 7 percent for calendar year 2004. The worst performer in the portfolio (which is one to which I no longer contribute) picked up slightly less than 1 percent; the best, a shade over 12. No doubt I could have done better had I tweaked things last January, but I wanted to prove, to my satisfaction anyway, that it's still possible to make money in an economy that doesn't impress Paul Krugman.
I'm a long way from wealthy, and I'm quite sure that with the combination of this nest egg, a pension I earned at a previous job, and whatever Social Security will be paying, I won't be buying any time-shares in Tahiti. But my position at the very bottom of the middle class or the top of the lower class, depending on your preferred index point isn't in jeopardy. Yet.Posted at 5:55 PM to General Disinterest