I am a big time advocate of Gold but we need to be resonable here.

Someone just suggested you withdraw your money and take a 50% penalty, that is nuts!

If you no longer work for the company where the 401K was accumulated, you can convert it to an IRA account and have much more choice.

If you are still with the employer your choices are limited.

If I were you I would take at least 50% out of the stock funds and keep it on the sidelines.

Now keep in mind that Gold rises because of the falling confidence in the dollar as a vehicle for storing ones wealth. Ones wealth could be stored in stocks also. Investing in foreign stocks is an added bonus because when the dollar falls you make that much more.

It is quite likely much of your “gain” is simply from the dollar falling and not necessarily from the actual foreign stocks rising, although it would really depend, you would need to read up on that.

Odds are the dollar is not going to have any major rallies.

Keep your money in the 401K, pull some out of stocks before Christmas (the FED will do anything and everything to keep people in the spending mood for Christmas so they will pull out all the stops to keep markets at least stable up till Christmas).

Again, if you can’t invest in Gold, the next best thing is any commodity so check for funds in your 401K that may invest in oil or lumber, anything like that.

Long term the value of the dollar will be less and less. Less compared to foreign currencies and less compared to what it use to buy.

When the market does correct (I think right after Christmas it will tank, but before the new year…..MY OPINION ONLY) don’t make the mistake and stay out too long.