Hot off the presses after my 401k loss announcement, Fidelity also reported 401k balances dropping 28% in 2008. The average account went from $69,000 to 50,000. Good news is that contributions actually went up slightly since 2007. So while on paper a lot of us lost money, we still have more shares in our portfolio. As long as you aren’t retiring in the next year or two, you’ll be okay. Some other interesting facts from the Fidelity report:

• Borrowing declined. The total number of investors who borrowed against their retirement plans declined from 2007. The total went from 9.7% to 9.0%. This is good news.
• Keep on trucking. 96% of active 401k plans from Q3 2008 contributed to their Q4 plan. Q4 was ugly, yet we kept putting money in. Most of us understand why (hint: time value of money!).
• Hardship up, amounts down. Even thought the number of hardship claims increased, the amount withdrawn was lower.
• Diversification. More users had better diversification in 2008 than 2007. Total number of 100% equity accounts dropped from 20% to 16%. In 2000, it was 37%. No doubt most of that change is because of the dot-com bubble.
• cruise control. Automatic enrollment numbers increased as well as 60% of plans being in lifecycle funds (aka target retirement funds). Set it and forget it!

Hopefully the pains of investing in 2008 are behind us, but we shouldn’t forget. It’s a long bumpy road to financial wealth and retirement. Keeping track of your goals, reviewing your portfolio allocation from time to time, and taking advantage of employee matching and other benefits will smooth the adventure.