With all the threads concerning investing in bond "funds" in a rising rate environment, was wondering what the community thoughts were concerning stable value funds. Recently my son started a new job and signed up for the 401k plan and had to make investment decisions and solicited my thoughts.
Even though he is 26, he has noted that his Roth IRA (he's had a Roth since he was 18), invested in Wellington fund and VTI, has taken a hit in the past year and feels that investing is a losers game. He did note that of his investment choices, the stable value fund was the only one that had not lost money in 2022. My recommendations were to contribute enough to get the full company match (50% up to 9%), fully contribute to his Roth outside the company yearly, and invest the 401k money 50% stable value fund and 50% S&P 500 fund.
Seeking thoughts on continuing to invest in a stable value fund in the current environment. Thanks in advance.
Even though he is 26, he has noted that his Roth IRA (he's had a Roth since he was 18), invested in Wellington fund and VTI, has taken a hit in the past year and feels that investing is a losers game. He did note that of his investment choices, the stable value fund was the only one that had not lost money in 2022. My recommendations were to contribute enough to get the full company match (50% up to 9%), fully contribute to his Roth outside the company yearly, and invest the 401k money 50% stable value fund and 50% S&P 500 fund.
Seeking thoughts on continuing to invest in a stable value fund in the current environment. Thanks in advance.