Study Shows Consistency Pays Off with Investing

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Jean Keener, CFP® and principal at Keener Financial Planning, reports on recent study.

For those tempted to stop investing when the market is declining, there’s now one more piece of evidence showing that it’s best to stick with your game plan through good and bad market conditions, according to a study released jointly by the Employee Benefit Research Institute (EBRI) and the Investment Company Institute (ICI).

The study "What Does Consistent Participation in 401(k) Plans Generate? Changes in 401(k) Account Balances, 2007-2012," analyzed 7.5 million 401(k) plan participants who participated in their plans consistently throughout 2007-2012. It compared their results with the broader database of 24 million participants. The broader database also includes those who had enrolled in or dropped out of their plans during that time frame.

Despite the stock market drop of 2008, the average account balance of 401(k) participants who continued investing during the five-year period ending Dec. 31, 2012 grew by a compound average annual rate of 6.8 percent, according to the study. The average account balances of the broader database actually declined by an average annual rate of 0.5 percent.

“This data strikingly supports the value of a consistent investment program,” says Jean Keener, CFP® and principal at Keener Financial Planning in Keller, TX. “During a market decline, many investors become scared and stop making their contributions for fear of ‘throwing good money after bad.’ This mistake is costly, however, because during a downturn consistent investors can actually purchase more shares for the same amount of money because the prices are lower.”

The study also included some other interesting takeaways:

  •     Over the analyzed period, the average account balance for consistent participants grew from $77,049 at the end of 2007 to $107,053 at year-end 2012; this was significantly higher than the 2012 average balance of the broader group ($63,929).
  •     The median account balance for consistent participants at the end of 2012 was $49,814, almost three times higher than the median balance of the larger group ($17,630).
  •     As of Dec. 31, 2012, over 30 percent of the consistent participants had more than $100,000 in their 401(k) accounts, compared with just 18 percent of the broader group.

Keener goes on to say, “Investing requires patience, discipline and consistency. This study is just one more example that maintaining a consistent focus over the long term is hugely important to a successful investment outcome and being prepared for retirement.”

More perspective on the study from Certified Financial Planner™ Jean Keener is available at The full study is available at

About the company:

Keener Financial Planning is a fee-only financial planning and investment management firm with offices in Dallas and Keller, TX. They provide as-needed financial planning on topics, including retirement planning, college and investing, as well as ongoing investment management services. They provide a free, no-obligation initial consultation to potential clients. For more information or to schedule an appointment, visit

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