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View Poll Results: If the market drops 25%-how would this affect your retirement?
No problem, I can absorb this and maintain my expense level 86 69.92%
I can probably stay retired, but will have to cut expenses 25 20.33%
My retirement would survive but I would cut expenses &/or go back to work 10 8.13%
My retirement would be in BIG trouble 2 1.63%
Voters: 123. You may not vote on this poll

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Old 07-26-2011, 10:11 AM   #41
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Many of us who have a decade or more under our belts have watched our equity positions fall by more than 50% TWICE in one decade.

The first time it happened to us in 2000 we were about 80% equities. So we lost about 40% of our retirement portfolio. This was scary! We lowered our AWR accordingly and lived off our MMFs and laddered CDs until the market recovered. We then adjusted our AA to a more traditional 60% equities.

The second time it happened in 2008 we were better prepared. We were holding 60% stocks and lost about 30%. At the end of the year, we rebalanced to 70% equities and rode the market back up.

Right now we sit at 60% equities because I see more danger in the bond market than I do in the stock market. If the stock market takes another dump, we will INCREASE equities again to 70% and sit tight.
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Old 07-26-2011, 01:18 PM   #42
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I think it has never been clearer that, in general our politicians' main objective is to get re-elected, as opposed to doing what is right for the country.

R
Not disagreeing, but how did these two objectives ever become mutually exclusive
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Old 07-26-2011, 01:27 PM   #43
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I voted 2. We would cut back on our discretionary travel every year.
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Old 07-26-2011, 01:29 PM   #44
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Not disagreeing, but how did these two objectives ever become mutually exclusive
One way is, if the 'grasshoppers' are a majority, and the 'ants' are a minority, the majority can vote/elect for things that are good for them short term, and ignore the long term. That's the ants problem.

I'm not saying that is the case now or in the past, or that anything is different. It's just one way that it could happen.

What's the old saying, democracy is two wolves and sheep debating what's (who's) for lunch?


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Old 07-26-2011, 01:54 PM   #45
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Our logic was that time is more important than money. Since we didn't make it to FIRE until age 58, taking a couple of years out to hunker down with no discretionary spending (camper, kayaks, fishing trips, vacations, home remodeling, etc.) didn't seem like a very good idea, so we continued on. Thanks to the nice recovery we experienced, it worked out.
DW/me feel the same way as you. In fact, in preparation for our joint retirement (even though DW changed her mind the month before her scheduled date - found she wasn’t emotionally ready), we set our plan with no "discretionary spending". To us, it is all required (including extensive travel) and did not plan for any cutbacks.

We looked at it in a way that a big step such as retirement should not be done "part way" - that is with the thought that if things didn't turn out, we could cut back or even (heaven forbid) look for another job.

Like you, we did not retire as soon as we could have, but did so when we felt we could retire and meet any market "hiccups" along the way, at the age of 59.

It's a different POV from what most questions - "can I retire" vs. our "should I retire". There is a difference, IMHO. There is a very good chance that we retired with “too many assets” and could have done so earlier, but we’ve always been kind of “belt and suspenders” couple.
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Old 07-26-2011, 01:59 PM   #46
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If it drops 25% again, as it did last time, I'll buy using most of $ reserves. I regret not buying more aggressively last time, but of what I did get, its been great gains.
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Old 07-26-2011, 02:11 PM   #47
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Quote:
Originally Posted by Rambler View Post
I think it has never been clearer that, in general our politicians' main objective is to get re-elected, as opposed to doing what is right for the country.
R
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Originally Posted by youbet View Post
+1 Your opinion is shared by many.

There seems to be a ring of Chicago-style politics in some of this...

Da Machine rolls on! In fact, it seems to be spreading out.
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+1

That's precisely why I spent a few minutes earlier today emailing my Congressional Rep and Senators explaining they MUST find a way to settle this without defaulting if they didn't want me to support their opponent in the next election...
+1. It's nice to be able to agree with everybody. Unfortunately, I have no one to write to. Anyone want to make DC a state?
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Old 07-26-2011, 02:28 PM   #48
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+1. It's nice to be able to agree with everybody. Unfortunately, I have no one to write to. Anyone want to make DC a state?
I suppose you are marginally worse off than I. At least I can write to my elected officials. But they have already made it perfectly clear that I would be wasting the postage. We only have one "flavor" in our state (instead of your "none".)
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Old 07-26-2011, 02:41 PM   #49
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We only have one "flavor" in our state (instead of your "none".)
We may not be a state but we only have one flavor - Dem. Which, unfortunately, is why we will never be a state
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Old 07-26-2011, 06:20 PM   #50
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I am not retired but will be in less than 12 months. I voted 1.
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