Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 12-17-2014, 12:51 AM   #101
Thinks s/he gets paid by the post
Sunset's Avatar
 
Join Date: Jul 2014
Location: Chicago
Posts: 4,749
When I started reading this thread, my wife asked what was so funny?
I told her I was reading about the market crash.
She said "Did we lose all our money?"
Guess I will have to de-sensitize her like other have done.
__________________

__________________
Sunset is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 12-17-2014, 12:55 AM   #102
Thinks s/he gets paid by the post
 
Join Date: Dec 2014
Posts: 1,664
tell her yes.. go back to work!... but don't tell my wife.. or I will not be able to RE
__________________

__________________
bingybear is online now   Reply With Quote
Old 12-17-2014, 01:15 AM   #103
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,442
Quote:
Originally Posted by Sunset View Post
When I started reading this thread, my wife asked what was so funny?
I told her I was reading about the market crash.
She said "Did we lose all our money?"
Guess I will have to de-sensitize her like other have done.
You should have replied "No, not all the money. Just our vacation next year. In addition to your kitchen remodel that we lost the day before".
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is offline   Reply With Quote
Old 12-17-2014, 01:19 AM   #104
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,442
Quote:
Originally Posted by bingybear View Post
crap... not again... another 3 week bust and boom... and I'll likely miss it.

if this is another 2008-9... likely worth looking at.
Who says there will be a boom soon after this one? Somebody guarantees that?

But if it happens, I will drink to that. And if it does not happen, damn, I will need even more drinks.
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is offline   Reply With Quote
Old 12-17-2014, 04:00 AM   #105
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,414
Quote:
Originally Posted by tuixiu View Post
y2k retirees with 100% of their assets in the stock market, do you think this is common?
not at all but bonds had a real return of zero after inflation for much of that time frame and in fact still do so they didn't effect things to much in a positive way to help pull that 15 year real return average to over 2% for that hypothetical retiree following the 4% rule in 2000..

of course the real world with spending adustments and spending patterns factored in the outcome would have likely been different and they would still be ok.

anything pertaining to the 4% rule can only be hypothetical since spending patterns are a huge factor but are not included in the "rule"
__________________
mathjak107 is offline   Reply With Quote
Old 12-17-2014, 04:05 AM   #106
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,414
the problem with drops is as our portfolios grow larger and larger after a while we tend to relate to things not in percentages but in dollars.


while a 7% drop does not sound like much that is 9 years worth of maxing out my 401k at the catch up level or 15 years worth of my wifes salary.


when we look at it in that perspective that drop is huge.
__________________
mathjak107 is offline   Reply With Quote
Old 12-17-2014, 01:28 PM   #107
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2013
Posts: 5,327
Quote:
Originally Posted by mathjak107 View Post
the problem with drops is as our portfolios grow larger and larger after a while we tend to relate to things not in percentages but in dollars.


while a 7% drop does not sound like much that is 9 years worth of maxing out my 401k at the catch up level or 15 years worth of my wifes salary.


when we look at it in that perspective that drop is huge.
This is how Wade Pfau phrased it in a Marketwatch article

“This is sequence of returns risk,” wrote Pfau. “People are more vulnerable to the returns experienced when their portfolios are larger because a given percentage change has a bigger impact on absolute wealth. A big portfolio drop at the end could possibly wipe out all of the portfolio gains from the first 25 years of one’s career.”

How to avoid sequence-of-return risk - MarketWatch
__________________
daylatedollarshort is offline   Reply With Quote
Old 12-17-2014, 01:54 PM   #108
Thinks s/he gets paid by the post
Major Tom's Avatar
 
Join Date: Nov 2009
Location: SF East Bay
Posts: 3,130
Quote:
Originally Posted by mathjak107 View Post
the problem with drops is as our portfolios grow larger and larger after a while we tend to relate to things not in percentages but in dollars.


while a 7% drop does not sound like much that is 9 years worth of maxing out my 401k at the catch up level or 15 years worth of my wifes salary.
I always thought it tended to be the other way around, due to the fact that as we age, we gain more experience in the market. I remember friends who were very nervous of equities when they started out. One co-worker was quite bent out of shape, because he'd put a first-time investment of a few hundred dollars into an index fund. A year or two later, he'd lost a significant percentage of that initial investment (must have been during a market crash) and was re-thinking the whole idea of equities.

The absolute dollar amounts are usually much larger when we are older, but we also have been around long enough to know that what goes down eventually comes back up.

At least, that's my perspective. I guess it depends on your psychological make-up/risk tolerance.
__________________
ER, for all intents and purposes. Part-time income <5% of annual expenditure.
Major Tom is offline   Reply With Quote
Old 12-17-2014, 03:44 PM   #109
Thinks s/he gets paid by the post
DFW_M5's Avatar
 
Join Date: Sep 2003
Posts: 4,982
Hopefully after today's close, you can forget about big drops for a while.
__________________
Doing things today that others won't, to do things tomorrow that others can't. Of course I'm referring to workouts, not robbing banks.
DFW_M5 is offline   Reply With Quote
Old 12-17-2014, 03:49 PM   #110
Moderator
Ronstar's Avatar
 
Join Date: Aug 2007
Location: A little ways southwest of Chicago
Posts: 9,363
Crash - what crash?
__________________
Ronstar is offline   Reply With Quote
Old 12-17-2014, 05:29 PM   #111
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,414
Quote:
Originally Posted by Major Tom View Post
I always thought it tended to be the other way around, due to the fact that as we age, we gain more experience in the market. I remember friends who were very nervous of equities when they started out. One co-worker was quite bent out of shape, because he'd put a first-time investment of a few hundred dollars into an index fund. A year or two later, he'd lost a significant percentage of that initial investment (must have been during a market crash) and was re-thinking the whole idea of equities.

The absolute dollar amounts are usually much larger when we are older, but we also have been around long enough to know that what goes down eventually comes back up.

At least, that's my perspective. I guess it depends on your psychological make-up/risk tolerance.
the problem is we do not know when it is coming back or even if it will be in our lifetime.

it can be especially damaging early on in a retirement .

but i think there is not one of us in 2008 -2009 who stayed the course and wondered is this time different.
__________________
mathjak107 is offline   Reply With Quote
Old 12-17-2014, 05:30 PM   #112
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,414
Quote:
Originally Posted by daylatedollarshort View Post
This is how Wade Pfau phrased it in a Marketwatch article

“This is sequence of returns risk,” wrote Pfau. “People are more vulnerable to the returns experienced when their portfolios are larger because a given percentage change has a bigger impact on absolute wealth. A big portfolio drop at the end could possibly wipe out all of the portfolio gains from the first 25 years of one’s career.”

How to avoid sequence-of-return risk - MarketWatch
so true. one session today in the upmarket we had was 2 years income for my wife.
__________________
mathjak107 is offline   Reply With Quote
Old 12-17-2014, 06:24 PM   #113
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,442
Everyday I compare my portfolio percentage change with the indices, meaning the Dow, S&P500, and the NASDAQ, to see how I fare. And I also look at percentage change for longer-term performance tracking.

I know not to look at the change in dollar terms, but man, when I was younger I would not think there would be a time when I would see a drop of $80K in a single day, or a gain of $50K (it always drops more and faster in a day than it does going up), and still acted cool.

Well, the market movement still hurts or makes me feel a bit happier, but I know that's the nature of the beast. And it's only money.

Quote:
Originally Posted by mathjak107 View Post
so true. one session today in the upmarket we had was 2 years income for my wife.
Being in the distribution and not the accumulation phase, I look at the dollar amount fluctuation in terms of how many months of living expenses that equates to. So, 2% today is roughly 6-7 months of expenses.
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is offline   Reply With Quote
Old 12-17-2014, 06:31 PM   #114
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,442
Quote:
Originally Posted by Major Tom View Post
The absolute dollar amounts are usually much larger when we are older, but we also have been around long enough to know that what goes down eventually comes back up...
... except that the portion that a retiree has converted into consumables is flushed down the toilet (literally!), and has no chance of coming back up.
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is offline   Reply With Quote
Old 12-17-2014, 06:42 PM   #115
Thinks s/he gets paid by the post
 
Join Date: Feb 2007
Posts: 1,905
Quote:
Originally Posted by NW-Bound View Post
... except that the portion that a retiree has converted into consumables is flushed down the toilet (literally!), and has no chance of coming back up.
You hope it doesn't come back up!

Unfortunately, living out in the bunnies with septic systems I can tell you from personal experience it ain't necessarily so!
__________________
ejman is offline   Reply With Quote
Old 12-17-2014, 06:51 PM   #116
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,387
Quote:
Originally Posted by Major Tom View Post
The absolute dollar amounts are usually much larger when we are older, but we also have been around long enough to know that what goes down eventually comes back up.
If you don't mind having that "comes back up" part questioned, sometime read Triumph of the Optimists by Elroy Dimson and others.

The title is perhaps misleading. IMO a better one might be Triumph of the Lucky.

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 12-17-2014, 07:02 PM   #117
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,442
Quote:
Originally Posted by ejman View Post
You hope it doesn't come back up!

Unfortunately, living out in the bunnies with septic systems I can tell you from personal experience it ain't necessarily so!
Uh, I was thinking the same, but did not want to use too graphic terms. While I do have a septic tank in my other boonies home, it is underutilized and I hope to never have the problem.

Don't you have a high water table where you live? That would cause a big problem when it rains dogs and cats. Like it has been doing.
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is offline   Reply With Quote
Old 12-17-2014, 07:08 PM   #118
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,442
Quote:
Originally Posted by haha View Post
If you don't mind having that "comes back up" part questioned, sometime read Triumph of the Optimists by Elroy Dimson and others.

The title is perhaps misleading. IMO a better one might be Triumph of the Lucky.

Ha
This is a book that I knew about and would love to read. However, it is only available as an expensive hard cover, and the local library has it in the Reference section and will not allow it to be checked out.
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is offline   Reply With Quote
Old 12-17-2014, 07:45 PM   #119
Thinks s/he gets paid by the post
 
Join Date: Feb 2007
Posts: 1,905
Quote:
Originally Posted by NW-Bound View Post
Uh, I was thinking the same, but did not want to use too graphic terms. While I do have a septic tank in my other boonies home, it is underutilized and I hope to never have the problem.

Don't you have a high water table where you live? That would cause a big problem when it rains dogs and cats. Like it has been doing.
Fortunately no, my house and septic system are on a small hill about 250 ft above the area where the water pump is located. The water table is about 70 ft lower than that.
__________________
ejman is offline   Reply With Quote
Old 12-17-2014, 08:54 PM   #120
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Apr 2013
Posts: 5,599
Quote:
Originally Posted by ejman View Post
You hope it doesn't come back up!

Unfortunately, living out in the bunnies with septic systems I can tell you from personal experience it ain't necessarily so!
You have some really smart bunnies. Ours know nothing about septic systems.

Sorry too good to pass up.:confused:

Sent from my SAMSUNG-SGH-I337 using Early Retirement Forum mobile app
__________________

__________________
MRG is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
2014 Doritos Crash the Superbowl Contest nvestysly Other topics 2 01-09-2014 04:20 PM
I put it all in Disney in October 2012...and I got a lot of grief from memebers oldnews Stock Picking and Market Strategy 68 11-02-2013 04:03 PM
October 1987 Crash: What would you do? ZMAN FIRE and Money 47 10-19-2007 10:45 PM

 

 
All times are GMT -6. The time now is 01:52 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.