You need to keep saving for retirement, despite any current downturns in the economy. That’s the conclusion of a recent question-and-answer session posted on CNN Money.com.

When you invest your money in your 401(k), improving your retirement prospects over the long term should be your focus,” says Walter Updegrave, the moderator of the session and a senior editor with “Money Magazine”.

Updegrave says that most people are advised to diversify their retirement investments into a mix of stocks and bonds during the early and middle stages of their careers, so short-term economic downturns won’t have much of an impact over the long run. However, the closer you get to your retirement date, the more you may be advised to shift investments over to something more conservative, like bonds, but not to stop contributing.

Stopping contributions to your retirement plan now would deprive participants of the tax benefits, says Updegrave. Since many retirement-related investments are pre-tax in nature, you don’t have to pay taxes until retirement, at which time you are theoretically in a lower bracket. Another disadvantage to stopping contributions now is that it also stops the compound interest such contributions, as well as matching employer contributions, will bring.

Lastly, Updegrave points out that stopping contributions now makes it that much harder to start up again later. The longer you maintain your current spending habits, the harder it is to lower them for diverting money into retirement accounts and that much harder to adjust to lower your spending once you retire.

If you sponsor a NADART plan, we can help you and your participants navigate the ins and outs of saving for retirement. For more information, please contact one of our Marketing representatives at (800) 462-3278, ext. 7161 or e-mail us at nadart401k@nada.org.