401(k) & IRA Review
Is Your 401(k) or IRA Actually Working for You?
Most retirement savings sit in a 401(k). It’s a familiar default, and for good reason, it’s what most employers offer. But it’s worth understanding where that default came from: the 401(k) was originally adopted as a cheaper substitute for the employer-funded pensions companies could no longer afford, with some employer matching added as an incentive to accept the shift.
The Gap Most People Don’t See Until It Matters
A standard 401(k) or IRA offers no built-in protection if the market drops. In 2008 the S&P 500 fell about 38%, and it took years to climb back. A drop like that is simply yours to absorb, and the arithmetic afterward is worse than most people expect: $100,000 becomes roughly $62,000, and a later 20% gain is calculated on the $62,000, not on what you started with. On top of that, every dollar you eventually withdraw, principal and growth alike, gets taxed as income.
This page describes general considerations about 401(k) and IRA accounts, not advice specific to your plan. We don't manage securities or investment accounts; this review looks at where insurance-based protection strategies may fit alongside what you already have.
What a Review Actually Covers
We’ll look at what you currently have, where the real gaps are, and what insurance-based options exist to add protection without starting over from scratch.
Frequently Asked Questions
Is my 401(k) or IRA protected if the market drops?
Most 401(k)s and IRAs have no built-in protection against a downturn, because the money is directly invested. In 2008 the S&P 500 fell about 38%, and the arithmetic after a fall like that is unforgiving: $100,000 becomes roughly $62,000, and a later 20% gain is 20% of the $62,000, not of what you started with. Behavior tends to compound it. People hold on the whole way down, sell near the bottom, and are sitting out when the market turns back up. Every dollar you eventually withdraw is taxed as income on top of all of it. We can walk through what protection actually exists for your situation, including what it costs you in upside, which is the part most people never get told.
Learn about our 401(k)/IRA Review →