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How will the recession or dollar devaluation affect my 401K &Roth investments? Should I sell off, buy euros?

Considering all I'm reading about this recession, I don't want to lose gains or especially capital I've invested into SEP, IRA, and rollover 401K accounts. If the stock market crashes or if the dollar devalues , what will happen to those investments? Could I lose my capital ? Should I cash them now and put that money into a money market account? Or perhaps buy euros or yen?

Public Comments

1. You`re already on the low side of a bear market, unless, Heaven forbid, we end up in a full-scale depression. We are already in a recession, as reflected by the stock market and other financial gurus (Warren Buffet, for one). A lot of damage has already been done to your portfolio, and the dollar has already de-valued. How low it will go? You, I and everyone else would love to know. Yes, worse case scenario, you can always lose capital with ANY investment. I won`t tell you how to manage your finances, but I will tell you this....Don`t liquidate. You`re going to pay some stiff penalties and taxes right off the bat if you do, and that on top of your (already) losses. Don`t buy Euros, because the dollar is ALREADY de-valued and your buying power is LESS. My opinion, Your SEP, IRA, and 401K ?? Ride it out, and wait for the upturn.
2. You have already lost money in this market, and through the devaluation of the US dollar. How much do you want to lose? Take back control of your destiny, and check out your investments. Sell your losers and buy more of your winners. If it's still in your IRA, it shouldn't cost you in taxes.
3. Of course you could lose your capital. This is investing and there is risk associated with it. The dollar is already devalued. A few years ago it was worth 1.5 per Euro. now it's .5 per Euro. Over recent years (30) our recessions have been fairly short in timing...if that's the case with this one then we are probably right in the middle of it. Which means we are at or near the bottom...to get out now would be selling at the low point. Then buying Euro's or Yens would be buying high...totally opposite of what you should be doing. If you're truly worried then modify your investments SLIGHTLY and get a little heavier in international equities. That will hedge you a bit. That and increasing your holdings in bonds too. You've got to diversify...get a nice balanced holding base and then tweak slightly every now and then to account for market conditions. You simply can't risk being too heavily in one sector of the market. Sure the gains are great when the market is humming but when it's down your balance gets devestated. Risk control is the key and it's only obtained through diversity.