Will I lose all my retirement savings?

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NEW YORK (CNNMoney.com) -- Stocks Friday plummeted on fears that the banks might be nationalized by the federal government. The move took the S&P 500 index to its lowest levels in nearly 11 years.

Are we going to lose all our money? And, how can I protect myself?

1. Get perspective

There have been losses in retirement accounts. The average 401(k) balance is nearly $50,000, which is enough to keep a couple going for a couple of years in retirement at best. 401(k) balances dropped 27% last year from $69,200 to $50,200 according to Fidelity.

The fears that the financial rescue attempts are doomed to fail is overblown.

Already, the federal government's effort to stabilize money market mutual funds is a big success.

Remember last fall? There was a run on money market funds -- a critical part of the nation's financial infrastructure. The government guaranteed those funds, and now the balance in those "safe as cash" funds is $4 trillion -- more than before the run on the funds. What's more, the government has collected $1 billion in fees for its effort and has yet to pay any claims.

2. Consider other angles

What's more, you're entire 401(k) doesn't need to be in stocks. You need an intelligent mix of investments to make sure your money grows over time.