Minyanville answers a question about the safety of someone’s 401K:
There are many reasons Americans are now conditioned to view common stock ownership and 401ks and IRAs as “savings,” and none of them are good. They range from Fed policy that systematically punishes savings, to the elimination of defined benefit plans to easy credit terms and predatory lending.
The end result has been the Death of Savings in this country. In its stead, a complacent view has developed where cash has been supplanted by credit and the ability to access credit has somehow come to be equated with “savings.”
Money in a 401k is investment money. Even money in a money market fund is, by definition, investment money. If the goal in your 401k is to avoid all losses, and it sounds like from your question it may be, then that money should by definition not be in a 401k. If the goal is to minimize losses, then you are in the safest investment vehicle available through your 401k. Just remember, savings is money you cannot afford to do without. Investments, even low-risk investments such as money market funds, are by definition money you are willing to risk losing - even if that risk of loss is very, very low. Risk is a two-way street.
People think of 401Ks and 403Bs as savings because so many politicians, consultants, pundits, etc. insist on calling them retirement “savings” plans. I cringe and want to shout “no, not savings, at risk investments” all the time.
Thank you for this little post about reality. And savings — of the old-fashioned kind — might be encouraged if banks paid more than 1% (or less!!!) interest on the accounts.