First Quarter Retirement Plan Performance Results

My daily personal finance routine continues to include net worth tracking. Call me obsessive but is there a better overall indicator of financial progress toward retirement? Not that I am aware of but I am certainly open to being educated by a reader on this. The results during the first quarter are positive but no doubt less than mediocre compared to many of you. The results are about what I anticipated.

My net worth increased by 2.0% during the first quarter of this year and by 3.3% compared to the same quarter a year ago. The reason I did not expect to do better is that I am presently uber-conservative in my investing.

My equity holdings represent approximately 25% of my retirement nest egg. The rest of it is in cash equivalents and inflation-protected investments. These include I-bonds and Treasury Inflation Protected Securities (TIPS) owned as individual bonds and in a mutual fund. Overall, bonds have not done well recently. Nor have commodities and I own a chunk of commodity-based mutual funds.

While I have rebalanced, I still believe that we will experience inflationary pressures before I retire. Therefore, I am not yet keen to completely divest from that category.

My 401(k) account has experienced a 1.6% personal rate of return YTD. Again, that is poor compared to the equity markets but I am not bothered by it. If others are doing better by taking on more equity risk, good for them. I am willing to trade potential gains for safety. With my present holdings, I can complete my plan for a reasonable and safe retirement income when the time comes.

If I miss out on some opportunities, so be it. I remind myself that many retirement income strategies (e.g., the “4% rule”) assume that the retiree is taking a reasonable amount of risk in the equity markets to boost overall returns, out of necessity. I don’t need those returns.

My net worth numbers would be somewhat better if I had not spent a good bit of cash this first quarter on more remodeling projects. I will continue with these projects until my Tennessee house is ready to sell and to prepare my Kentucky house for the long term.

I have no idea what percentage of my fellow baby boomers use net worth monitoring as a retirement planning tool. I’m considering putting together a simple net worth tracking tool (similar to what I use myself) and making it available to other baby boomers as a free or inexpensive download. Do you think there would be interest in that?

How is your net worth progressing?


  1. Tara says

    I only do a loose calculation of my net worth as cash in bank accounts, value of 401K and approximate value of house. Mostly I just look at the year over year gain/loss in the 401K as my progress in net worth.

  2. Frank Rutherford says

    I frequently check the direction of the markets (roughly daily), but I usually wait until the end of the month to do any analysis. I include bank accounts and investments, including 401k, but not our house which is much less easy to determine. Since we are still working, savings often makes the difference between an increase or decrease in assets at month-end. I have much of my assets in equities, but also have large cash reserves (uninvested cash) which I feel gives me some protection against down markets.
    I really appreciate your column and will be checking your ‘Medicare’ blog as I approach my 65th birthday this summer.

  3. Doris says

    I am retired presently —over four years now and still have the major core of my retirement monies in the TSP plan. I usually vary the percentages of my holdings between 25% to 35% in the C and S funds . I am a little down for the year—I was at a 6% gain and now am down to 5.05% gain for last 12 month period. I have not taken any withdrawals from this plan and will wait until 70 1/2 when the RMD becomes due. I have other investments in mutual funds and real estate holdings. Like the above poster, I watch the markets daily but still feel comfortable to keep a portion in stocks for growth. So far, I have not had desire to change my strategies and pretty satisfied with the way my investments are structured. My cash reserves are enough to deal with any major issue that may arise. Life , for hubby and me, is happy and contented and I pray this continues for us —for all you as well.

Leave a Reply

Your email address will not be published. Required fields are marked *