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I contribute to my 401k each pay period. When I receive my quarterly statement, my account has grown in value, but the mutual funds have lost value for the period. How can the value of my account be up when the investments have lost value? Answer: The value of your account will grow as the result of new contributions, income earning (dividends and interest payments), and asset growth. If your contributions and income earning are more than the amount your assets declined, then your account will still grow in value. The only way it will decline is if your investment funds loss more value than the amount of new contributions and or earnings. This is for educational purposes only. The information provided here is intended to help you understand the general issue and does not constitute any tax, investment or legal advice. Consult your financial, tax or legal advisor regarding your own unique situation and your company's benefits representative for rules specific to your plan. |
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