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Don’t leave your 401(k) on autopilot in 2022

With the start of the new year fast approaching, all New Jersey investors, including workers with a 401(k), need to take a fresh look at their portfolios so they can sync with changing conditions.

That’s a recommendation from Ken Kamen, president of Mercadien Asset Management, based in New Jersey.

He said that a lot of people who have relied on the S&P 500 in their 401(k) because they own an index fund, have relied on big-name growth stocks well but “in an environment of rising interest rates, there is no future dividend” even lower priced so far, So the outlook for stock growth as interest rates go up could really dwindle.”

So, what should you do?

“I think people might want to rebalance maybe just away from the straightforward S&P 500 and look at a more cyclical type — consumer staples, industries, materials,” he said.

“If you’re relying on growth stocks and those household names to fuel your returns, you may want to expand that over the next year.”

Screen above the trading floor at the New York Stock Exchange (AP Photo/Richard Drew)

As the supply chain disruption crisis continues, “we’re going to start to see a lot of countries, here in the United States and the developed world, start supporting more manufacturing and stockpiling more products,” he said.

The same scenario would also take place in Europe and other parts of the world, Kamen said, so “people really need to rethink their allocations, I don’t think 2022 is going to be a year where you leave your wallet on autopilot.”

The idea, he said, is to start moving from things that used to work “to things that are more likely to work when the world re-magnifies itself and manufacturing begins to shift from the undeveloped world to the developed world.”

What does this mean for 2022?

I actually think 2022 could be a very good year for the market as we all start thinking about COVID in a little bit more of an endemic kind of way than we have to live with it.”

Kamen noted that with inflation starting to pick up, it will be positive for stocks because companies “end up restoring pricing power at a time when people are flooded with cash.”

You can contact reporter David Matthau at David.Matthau@townsquaremedia.com.

Red flags for someone claiming to be from New Jersey

Teachers, NJ educators arrested at sex crime statues

Over the past few years, state lawmakers have taken on the challenge of dealing with accused child predators among the ranks of teachers and educators.

In 2018, a so-called “garbage pass” law went into effect, requiring more stringent background checks for a New Jersey school in relation to child abuse and sexual misconduct.

The following individuals have been arrested over the past several years. Some were convicted and sentenced to prison terms, while others agreed to plea deals for probation.

Other cases are still pending, including some court delays amid the COVID-19 pandemic.

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