Worried about your 401(k)? Here's what a financial expert recommends
A financial advisor in Roseville advises retirement savers to keep investing, and even consider increasing contributions, despite market volatility.
SACRAMENTO, Calif. — As stock market swings rattle investors and the U.S. economy posts its first quarterly contraction in three years, a Roseville-based financial advisor is urging retirement savers not to panic and instead stay the course.
Elizabeth Daffner, founder of Diligence Wealth Management, says most Americans, especially those not planning to retire soon, should consider increasing 401(k) contributions.
“This recent market dip is an opportunity to anybody who has a retirement account they’re contributing to, because remember when the market goes down, stocks are on sale,” Daffner said.
The U.S. economy shrank in the first quarter of 2025, largely due to a slowdown in consumer spending and concerns over tariffs enacted under the Trump administration. Still, financial experts caution against knee-jerk reactions that can undermine long-term retirement plans.
“If you’re adding money each month from your paycheck into those retirement accounts, you are going to make even more money when the market recovers,” Daffner said.
401(k) accounts are structured for long-term growth and short-term emotional decision-making can have lasting consequences. Daffner encourages consistent contributions even during economic downturns.
“Absolutely, definitely, 100%. Increase it and be consistent about it and don’t worry — the market will eventually come back,” she said.
There’s no one-size-fits-all formula for how much to contribute, but Daffner recommends contributing as much as is financially feasible.
“If you can, increase that 401(k), increase that SIMPLE IRA contribution,” she said. “Some people just set it and forget it. Don’t do that.”
The longer your money is invested in the market, the more potential it has to grow.
“The longer that money can sit in the market is good for you,” Daffner said.
She cautions against investing money that may be needed in the short term, like funds set aside for near-future expenses such as buying a home within the next year or two.
Instead, Daffner suggests placing the money into a high-yield savings account.
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