How can you trust an investment err, "specialist?"

[Alice S. Fuzzybutt]

I got my taxes done a few weeks ago. For the first time in eons I made a contribution to my IRA (I haven't since I've had a 401k for at least 13 years).

I didn't get "credit" for my 2008 contribution to my IRA so my accountant decided I should recharacterize my 2008 contribution as a ROTH IRA. I got an appt with an investment person at my bank (since I invested my IRA in a mutual fund) this past Friday. The paper work is done.

Then she asked me about my other retirement savings. I told her I have one with my current employer and that I left my other one with my last employer. She told me, "Don't leave ANY money behind. Case in point, Enron." SO I got the paper work rolling to roll over my old 401k into one of my IRAs. It made sense to me, but then she wanted to invest more of money. She was very nice and understood that my job may be short lived.

My question is: how do I know she's right? She made a good point that we will never have the chance that we have now to buy shares at such a low price when the market will eventually bounce back.

It all makes sense, but it also made sense when I put money into various mutual funds in 1996. Hell, I put a huge down payment on my apt b/c of the boom.

I'm just wary and scared. I know putting money into the stock market when it's down can be a good thing. But I'm not Warren Buffett.

Any insight is very helpful. THX.

[SatCam]

Personally I would agree with her. I have sank a good portion of my savings into the stock market within the past year and a half on this belief.

You have at least another 20 years until retirement (right?). If you let the money sit in a low interest account its value will be much less 20 years from now. However, if you put it into the stock market, you stand to earn good interest on the money. If it's invested correctly, you won't be a millionaire, but your money won't lose its current value (and it already has lost some value by not being rolled over into the IRA after you left the company).

If it's any comfort to you, the Dow is 246% higher today than it was 20 years ago. So even in this recession, we are still up from 20 years prior. Even better, two years ago the Dow was 456% higher than '89.

It is up to you. If you want to take the risk, then do it. If not, just say NO. She can't force you to do anything you're not comfortable with.