What happened to the stock market — and what has happened to your retirement plan?

As the stock market continues to tumble to historic lows, many are considering what is the best move for their 401(k) and other retirement funds they may have invested. We asked AARP spokeswoman Kathy Keller, Vanguard senior investment analyst Donald Bennyhoff, and Motley Fool officials what to do with your retirement funds.

Q: Should I withdraw funds from my 401(k)?

Bennyhoff: No, no, no. That is an extreme position to take even if retirement is imminent."

Drop-offs in the stock market are usually not long-term. Ride out the storm. In the long-run, the recent dips may even work to your advantage as new investments will gain more ground more cheaply over time.

Q: Are bonds safer

Bennyhoff: Not necessarily. Bonds do not tend to grow as well during inflationary periods. Diversify your retirement holdings with bonds, a mixture of stocks and short-term reserves for the best return.

Q: I want to retire now. What should I do?

Motley: Plan to save way more aggressively or work longer. Saving is less feasible as, for example, if before the crash you had $500,000 in retirement savings, your 401(k) is now down to $360,000. To make up the difference in five years, you would have to save an additional $2,800 a month.

The longer you work, the more time you have to invest in your 401K and give the market time to rebound. It also subtracts years you will have to live off those savings.

Q: What are ways to save outside the market?

Keller: As part of the bailout, the FDIC will soon allow up to $250,000 to be insured in individual savings accounts. Right now, it is $100,000. IRAs (Individual Retirement Account), which are already insured for $250,000, are another good option as well as CDs (Certificate of Deposit). Check with your financial advisor.

Q:What about money market mutual funds?

Motley: They are less risky. Mutual fund companies have until today, Oct. 8, to sign up for a U.S. Treasury program to protect shareholders if the funds dip below $1. Check with your fund to see if it is participating.