The equity markets haven’t been kind to individual investors over the last decade. I always beware those sales pitches from investment firms that show equity growth over a specific time, choosing to show gains starting from a market bottom (2009).
If you have been investing into a 401k or any kind of equity account every year for the last decade, chances are that you lost quite a bit of money in both 2008 and 2011. Many people make it worse since they freak out and sell at or near the bottom: The flight to cash. The S&P 500 has taken over six years to recover to the 2007 level.
Now that the economic recovery is picking up steam and markets are on their way back up, you may find yourself in the position of inheriting a trust or other estate account that still has a capital loss. You can take over that loss as a capital loss carryover. To do this, you will need to get an IRS form K-1 from the trust/estate that documents unused Capital Loss Carryover. You then apply that against any capital gain/loss that you’re recording in your 1040 form.