How did you react to the crisis?

[oldtrig]

I got an estimate to replace my driveway. Seven grand. I will just drive on the old broken one until I can find someone to do it cheaper. I tied up $$$$$$ in Cd's in 07, 5% for five years. Not bad when Cd's now are only paying around 2%. I still work but can see the light. old trig

 

[mews]

I didn't really do anything.

I did buy stock on one of those 500-point-down days. I was in the administration office, and a very nice young soul (23?? ) had cnn on with a red, flashing "banner of doom".

Hmmm - I asked her to get a quote on this and that, said "I'm going shopping" and bought 100 shares of a stock I had had my eye on. If I had had more loose cash, I would have done more.

I'm entirely indexed except for 2 things, so that was my excitement. (It is up $12 per share now.)

ta,
mew

 

[cashflo2u2]

I just crawled under my desk and assumed the fetal position. When the market turned my wife called me with "it's ok to come out now, hon".

 

[dm]

I retired in October 2007, I'm still retired. We watched our budget in 08 and stayed away from any big purchases. We still went on vacation and I'm still a member at a very nice golf club. This year we had our deck redone and I am planning on helping my adult sons out alittle bit to help them get ahead. If the market was still at 7000 I would probably not have had the deck redone.

So I guess that we tightned up alittle when the net worth was dropping on paper, and now that it is rebounding somewhat, we are spending alittle more. But I'm also 52 now so only 10 years away from SS and two years closer to death.

 

[ejman]

I rebalanced in February/March 2007 as the stock portion of my portfolio exceeded the 65% upper limit of my 10% band. I did nothing over the next two years other than worry if the end of the world was at hand. In March of 2009 I started thinking that it was almost time to start buying equities since I was rapidly approaching the 55% lower limit of my allocation for equities. Just about when I was wondering if I really had the guts to do it the market starting going up... saved by the bell. I'm currently at about 62% equities and if I get to 65% rinse and repeat.

 

[toofrugalformycat]

I rebalanced over several months, setting up automatic purchases in Vanguard so I didn't have to think about it. I am back to my target asset allocation just this week.
I had been sort of planning to buy a new car, but decided instead to keep the old beater(s). As of today they are both still running so I guess that turned out to be a good move anyway.
I stuck to my regular budget through the whole thing. I thought I was cutting back on discretionary purchases (the market drop freaked me out), but seem to have spent all my budget anyway.

 

[Telly]

How did I react? With CNBC on in the background, I moved the living room furniture closer to the center of the room. Then I ran around it in circles as fast as I could, yelling "Oh my Gawd! Oh my Gawd!!"

Seeing that my impassioned outburst had absolutely no effect on CNBC... I quietly turned off the TV, moved the furniture back, and went back to remodeling my kitchen.

In year 8 of an early-E/R. Pretty big cash buffer.

.......In March of 2009 I started thinking that it was almost time to start buying equities since I was rapidly approaching the 55% lower limit of my allocation for equities. Just about when I was wondering if I really had the guts to do it the market starting going up... saved by the bell.......

That PO'd me a bit, after the fact. Back in March, I dropped below my 55% lower trigger, didn't notice, wasn't paying attention, then just caught how low the S&P was. Didn't have enough time before the market closed that day to get the specifics together to rebalance. No worry, got a plan together that night for the next time, figured it would come in the few days after that, or weeks after. Never did. That exact day that I didn't have my act together was the market low. Oh well...

 

[traineeinvestor]

I'm nearing the end of the accumulation phase.

The first thing I did was calculate how many extra years it would take to reach our number - at one stage retirement looked like being deferred from 2013 to 2016 or 2017.

The second thing was to see how long we could last without having to sell assets if we both lost our jobs - the answer was measured in years so I decided there was no need to do anything other than try to pick the bottom and move cash to equities or real estate.

The third decision was to make sure I kept my properties tenanted even if I had to cut rent to keep a tenant (which I did). Keeping the rent coming in meant I did not have to dip into my own pocket to meet mortgage payments.

I started buying in November 2008 with the intention of running down my cash over a period of about six months. This proved to be a good decision.

I then got lucky - I changed jobs and received a substantial lump sum from my long service payment. The first installment was received at the end of January and I more or less immediately invested all of it in equities over a 2-3 month period. The second installment came through a few months later and was also invested in equities over a short period of time.

This was aggressive but so far has more or less got us back to the original retirement target date at the end of 2013.

 

[CyclingInvestor]

51, 3 years retired (paid-off house, no pension, divorced), 100% in dividend paying individual stocks.

No changes to investing, travel, or spending plans. Market value of stocks shot down, then up (couldn't care less), while earnings and dividends kept increasing, although slower than before the recession (much more important to me). My main reaction to the crisis was when the increasing tension in the financial sector in the spring and summer of 2008 made analyzing the assets of anything there difficult I traded in all financial stocks for ADP, SYY, PG, JNJ, KO, etc.

 

[Dawg52]

Hey Dawg, are you moving everything to CD's now. (heh)

20% stocks
30% bonds
50% cd's

The stocks are mainly dividend stocks. I'm satisfied with my AA now. First of the year I was roughly 50/50.

I wish I could have regained all my losses like some here, but didn't have the b*lls to double down or ride it out any longer. Just happy to be closer to my original 'number'.

 

[Walt34]

We didn't change anything investment-wise. On a whim, I applied for a job and got it. Been there a year now. The bulk of the extra income is going to savings but I did buy a new toy (motorcycle) that has been a lot of fun - 6,300 miles since December and a few nice restaurant meals that we probably wouldn't have done otherwise.

I'll stay at the job until at least next spring since in the winter we don't go outside much anyway so I may as well do something productive.

 

[tryan]

Mainly doing alot to repairs/maintenance I would normally contract out. Stained one house myself ... a 3k job done for half (with a rented lift and sprayer). Now finishing up painting our house; a 8k job I'll do for 2k.

Also found a laid off plumber who charges HALF what my existing plumber charges. Sent him on two rental jobs and smiled at the bill! That hasn't happened in a long time.

 

[Dennis]

Well, since we are Retired ( @ age 55 and now 62)? We weathered 08' quite well..
1. We have a Investment port of 20/80 an provides more than enough income & growth
2. We keep 2-3 yrs of COH to pay the bills in MMKt,CD's and ST Bonds
3. We live with-in our means most of the time- Modest Home , Used cars, etc..
4. We use Alot of Coupons and Discount Membership plans ( saves us ave of $5k yr) and gives us Alot more Things to eat an Do on the Cheap we otherwise wouldn't.

And While working Yrs? We never had more than about 50% in Stocks, that forced us to Live more with-in our means and Save more and when we hit in our late 40's and the kids were on their way, we dropped to a 30/70 mix portfolio..

We didn't make much last yr, only about 4% on our Investments, but our Pensions an New SS income is far more than we need anyway..Just Reinvesting our savings for the future days when we may need More Income..to hire a Live In to take care of us or NH costs, etc..

Or, if we die before then? More $ for the Kids and Some Chariities!

But, we're still looking for that 'Caccoon' retirement Village.. we want to stay at the Age and Physical status we are now at for another 100 yrs.. Life is Good..so far..

LOL..;-)

20/20 hindsight on Investing? Don't own more than 50% in equities an after age 40? More into Bonds.....

Kids? VWELX & VWINX isn't a Bad Place to start..then add some more Bal. Funds like OAKBX, FPACX, PRPFX and when you get 'really old-like 50's? LOL, add a HSTRX.
and just load them up with your Nickels and Dimes and let them take care of things..

Worked for Us and many of our Friends..!

 

[tuixiu]

I worried a little about my job but not hers. It wouldn't have crimped our lifestyle if I lost mine but I would have been pissed off about not having the extra monthly cash to buy at market lows.

 

[Moemg]

.

I wish I could have regained all my losses like some here, but didn't have the b*lls to double down or ride it out any longer. Just happy to be closer to my original 'number'.

The only way I regained a chunk of my portfolio was to stay at 70% equities and ride it up . I have now rebalanced down to 65% and that is where I will stay . I've read that the number should match your comfort level not your age and that is my comfort level .

 

[ejman]

The only way I regained a chunk of my portfolio was to stay at 70% equities and ride it up . I have now rebalanced down to 65% and that is where I will stay . I've read that the number should match your comport level not your age and that is my comfort level .

I've been struggling with the allocation % to equities and most sources I've read ( Bogle et al) indicate my 55-65% equities is way to high at my age (59). Your comment on matching your comfort level not your age is "comforting"

 

[audreyh1]

The only way I regained a chunk of my portfolio was to stay at 70% equities and ride it up . I have now rebalanced down to 65% and that is where I will stay . I've read that the number should match your comport level not your age and that is my comfort level .

I didn't have as high an allocation to equities (55%), but I rebalanced on the way down to maintain it, and so things have recovered very well (so far! - knock on wood).

It was very scary last Nov and March. Terrifying really. I don't know how I hung in there and my peers will probably say the same. Sure, we've been rewarded by seeing our portfolios recover tremendously. But things could have gotten worse - there was no clarity at the time, you just didn't know.

Audrey

 

[Moemg]

).

It was very scary last Nov and March. Terrifying really. I don't know how I hung in there and my peers will probably say the same. Sure, we've been rewarded by seeing our portfolios recover tremendously. But things could have gotten worse - there was no clarity at the time, you just didn't know.

Audrey

It was terrifying . The only thing that kept me somewhat sane is my house is still worth a huge chunk of money even with the drop in Florida prices so for me the worse scenario was I'd sell the house (which I'd like to do any way ) and replenish my damaged portfolio .

 

[W2R]

It was very scary last Nov and March. Terrifying really. I don't know how I hung in there and my peers will probably say the same. Sure, we've been rewarded by seeing our portfolios recover tremendously. But things could have gotten worse - there was no clarity at the time, you just didn't know.

It was absolutely terrifying. At the time it seemed pretty much impossible that by September we would be doing this well and discussing who had regained everything and who hadn't.

And yet, here we are.

Seldom am I inspired to quote a Democrat, much less FDR, but he really nailed it when he said in his 1932 inaugural address

This is preeminently the time to speak the truth, the whole truth, frankly and boldly. Nor need we shrink from honestly facing conditions in our country today. This great Nation will endure as it has endured, will revive and will prosper. So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.

 

[Dennis]

using what your comfort level in Bonds, maybe good for some that KNOWS what their real comfort level is, but for others, not so much..
Why?
1. Most levels are based upon past performance and can be misleading, such as Bonds were great in 00-02', but not so much in 08'..
2. Inflation and Increased rates to pay taxes is comming.. an the last time this has happened? ( Think Carter -80's) Bonds were the worse to be in. Except of course Treasuries.. an How did bonds do most recently in 1999?
3. Traditional Bonds are what I'm talking about an why doesn't Vanguar have Global an EMD bonds? Those ade to one's Bond Portfolio would have boosted it by 2-3% apy...!
4. Then we have the Have Nots, or those that Aren't able to save enough that a 7% apy rtn will get the job done for them an thus they have to own more Equities, if they are going to Have a Chance..
5. If one is Saving Enough to More than enough an a 6-7% apy will get the job done? More power to you, you're among the Rich or you have Other Sources, such as Pensions an Max SS to Get the Job done..an your Still Considered Rich..
6. On the Otherhand? If One Truly wants to "Make as Much as they can" with their $? Then they shoul not own Any Bonds and just Learn and Invest into Equities, Leveraging, Options, etc.., Then an only after then they have made enough? Move the $ into safer ports..and go Sailing, fishing and golfing..

The Ave. savings a Senior has today is about only $50,000 per AARP and living on their SS and a Pension... Using 4% WD out of that $50k is only $2k yr to supplement your income.. But Invested into Small Caps for example? You can take out upto 8% WD and double that Supp. Income ..So, bonds in this case are a Determent an not an asset.. Others Opt to use Stock an Divs's instead of a Mutual Fund and are doing very well with them..Inspite of the 08's losses..their Divs/Ylds are paying the bills , while the Stocks Nav is recovering..

Bottom Line: I think, IAD.. ItAllDepends how much you have vs how much you need.( not want) should lead one towards what % in Bonds they should have..
and Guessing you feel comfortable at any level is strictly conjecture and a guessing game until the worse case happens and by then, it's usually too late to change things..

My Comfrot level? Is Making what I need and "0" Downside Risk..and I could care less if everyone else/ Wall Street or otherwise, is making + or - 40%..

;>)

 

[Dawg52]

The only way I regained a chunk of my portfolio was to stay at 70% equities and ride it up . I have now rebalanced down to 65% and that is where I will stay . I've read that the number should match your comfort level not your age and that is my comfort level .

And I stayed at 50% stocks and rode it up to the DOW 9,500 level. I regained a good chunk as well, but certainly not all of it. But comfort levels are quite different for most. I'm probably too conservative for my own good, but that's OK.

 

[Moemg]

And I stayed at 50% stocks and rode it up to the DOW 9,500 level. I regained a good chunk as well, but certainly not all of it. But comfort levels are quite different for most. I'm probably too conservative for my own good, but that's OK.

I 'm probably way too aggressive for my own good so we balance out !

 

[HFWR]

55, with 4-7 years left in the w*rkforce...

At first, I tried to stay the course. But as the "crash" unfolded, I had an "oh, sh*t" moment, or two...

Last fall, I reduced my positions in what I considered the most risky stuff, namely REIT, commodities, and emerging markets. Then, the volatility was killing me, so I widened the rebalance bands from 1%/10% to 5%/25%. I rode that until the first of the year, then bought HYG and TIP, while reducing my equity allocation some more. Have made good money from the HYG/TIP moves.

I've been ignoring the bands on the way back up, trying to keep the bond/cash portion topped off, for the inevitable "correction".

I'm now at 40% equity (SP500-15%, Russ2000-10%, VGK-7.5%, VPL-7.5%), 40% bonds (HYG-10%, TIP-15%, ST fund-10%, and total-5%), REIT-5%, CCF-5%, and cash eq-10%.

Still down 14%, which is a major improvement from down 34%...

So, reduced risk, and did some DMT, but didn't freak out totally...

 

[bbbamI]

Ok...I'll be honest. At first I

...then,

later on

.
It got to the point when I felt like

. However, I didn't

.

 

[kumquat]

Crisis? What crisis?