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I am worried about the markets, should I stop making contributions to the retirement plan?

DAREN DERFLER:
Hi,I am Daren Derfler, a retirement counselor with Prudential. I get it – the market has changed very quickly and many people have been asking me if they should continue making contributions to their retirement plan. Here is what I tell them…

Buying across all market cycles, whether up, down, or in the middle, results in something called dollar-cost averaging. This means that you are buying investments at the current market price with each contribution you make to your retirement plan. So when the markets are down, and you continue to make contributions to your retirement plan, you could be purchasing stocks and/or bonds when they cost less. And if you continue to make steady contributions in all markets, studies have shown that the consistent investor typically gets a better overall price per unit/share versus an investor who buys in occasionally. 

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This material is intended to provide information only. This material is not intended as advice or recommendation about investing or managing your retirement savings. By sharing this information, Prudential Retirement® is not acting as your fiduciary as defined by the Department of Labor or otherwise. If you need investment advice, please consult with a qualified professional.

Retirement products and services are provided by Prudential Retirement Insurance and Annuity Company (PRIAC), Hartford, CT or its affiliates. PRIAC is a Prudential Financial company. 

Retirement Counselors are registered representatives of Prudential Investment Management Services LLC (PIMS), Newark, NJ, a Prudential Financial company.

Dollar-cost averaging and other periodic investment plans do not assure a profit and do not protect against loss in declining markets. Such plans involve continuous investment in securities regardless of fluctuating price levels of such securities. Investors should consider their financial ability to continue purchasing through periods of low price levels.

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