Parents lost money in 401... put 401k on HOLD?

[yorkinvestmentreport]

Risk tolerance is also a huge factor here. If they can't sleep because of the volatility, they should be in less risky investments to begin with.

[jIM_Ohio]

This is not a good time to be selling any investment.

The best decision is to do nothing and let market recover, unless retirement is literally within 5 years. Even then I would advise waiting and taking other steps.

I advocate contributiong 15% of gross pay to a retirement account and another 5% to a cash account every month and every year.

One of the reasons for this is 25% of "new money" goes to cash and reduces volatility. Few people understand volatility well. The 10-11% returns people quote on stock market returns over 20 year periods comes with a volatility (standard deviation) of 14. This means a person is as likely to see a -4% return per year as they are a +24% return. That is a 28% swing 75% of the time. If a person "needs" the 10% return, they need to accept the volatility, then find other ways to lower risk (paid for mortgage, spend less than they earn, bank 5% of every paycheck to cash).

[snafu]

I doubt that retirees cash out their retirement a/c when they stop work. They are more likely to draw down sums monthly, according to their needs. Individuals who are 5 years from retirement need to invest in lower risk instruments and s-l-o-w-l-y adjust equity to bond type programs BUT this isn't the time to do that if it results in excessive loss. Typically equities offer higher returns than money items and retirees will need to support themselves for much longer time frames than in the past.

Don't expect instant fixes but the equity market will recover. If you [your mutual fund] bought stock in good quality, well run businesses, that have been beaten down because of the illegal or borderline legal shennanigans of the financial marketplace...your investment will recover.