Not as chilled as the rest of you - need advice

[jim584672]

I saw some of the prices on the open, I thought they where incorrect or something. Too shocked to take advantage of it.

[harley]

Quote:

Originally Posted by frayne Always carry a flagon of whiskey in case of snakebite and furthermore always carry a small snake. - W. C. Fields.

Hey, you stole my sig line!

[NW-Bound]

Imitation is the sincerest form of flattery.

I steal borrow Uncle Mick's "Heh heh heh" line daily, and I am not abashed about it.

[harley]

True 'dat. I was realizing all it meant was that we had two flagons available just in case.

[NW-Bound]

Can't share a common snake?

[harley]

They get really PO'ed if you dip them in the whiskey to sterilize them between bites.

[Ready]

The OP did not state what percentage of total savings is in equities, so it's hard to understand the impact of this market drop.

If I was within a few years of retiring, I would likely have no more than 55% in equities, and would be whittling down to 50% around the day I finally quit and stop generating income. I like the idea of starting retiring off with a low exposure to equities and building it up a bit over time, maybe to 60% as the years go on. It helps to reduce the sequence of returns risk at the beginning of retirement.

But without knowing more specifics, it's hard to give advice here, other than "stay the course..."

[Fermion]

There has to be some fallacy with that method. If you eliminate the sequence of returns risk by not being in the market, you have to add on some longevity risk or something to balance things out.

So you reduce the risk that the market crashes right when you retire, but you may run out of money in 35 years instead of 40 years. Something like that.

What if all of the gains you will ever see in the market happen to fall within the first ten years of your retirement and you miss them?

[frayne]

Quote:

Originally Posted by harley Hey, you stole my sig line!

Guess we will have to share !!!!!!

[papadad111]

Quote:

Originally Posted by Fermion There has to be some fallacy with that method. If you eliminate the sequence of returns risk by not being in the market, you have to add on some longevity risk or something to balance things out. So you reduce the risk that the market crashes right when you retire, but you may run out of money in 35 years instead of 40 years. Something like that. What if all of the gains you will ever see in the market happen to fall within the first ten years of your retirement and you miss them?

Exactly ! I'm very heavily weighted in equities. FIRED in April and at just 46 I traded off sequence of returns risk for longevity risk.

I'm down 12% from all time highs earlier this year - equates to 7 or 8 years of living expenses in about a week -poof - paper losses. But, over the past 3 days I put a substantial portion of my cash to work and bought more ...

Dividends are hard to ignore in a near zero rate environment as long as the underlying assets eventually get back to par which they will eventually.

It's scary.

In past I held during 1987. Held during 2000 and happened to be I "in cash" during 2007 and 2008 . Problem was , it took me until 2013 to start going back into the market. Wish I'd have gone in sooner. Timing things is just too hard to do. Now that were fired I am nervous but also believe this is not the end of the world and is a long long overdue " real" correction and we may see 20 percent before all said and done. But I also hope we recover within 2-3 years !

[marko]

FWIW, at 10PM tonight the Dow futures are up 250.

Doesn't mean a lot I know, but....

[growing_older]

Quote:

from our perspective, if we had've cashed out before a/the drop, that money would've been in our hands...that was OUR money.......and now it's not.

The problem with this little voice running through your head is that you didn't really know when to sell before the crash. Now that a drop has happened, the voice is saying that was the time, but until that drop you might have just as easily cashed out before a big up move, or before a big sideways followed by a slow climb up the wall of worry. The worry and regret doesn't play fair with what was known before the fact vs after.

[Nemo2]

Quote:

Originally Posted by growing_older The problem with this little voice running through your head is that you didn't really know when to sell before the crash. Now that a drop has happened, the voice is saying that was the time, but until that drop you might have just as easily cashed out before a big up move, or before a big sideways followed by a slow climb up the wall of worry. The worry and regret doesn't play fair with what was known before the fact vs after.

Oh, we realize it's selective thinking/viewing.......but it's a nagging, finger wagging, selectivity nonetheless.

[Major Tom]

I don't know if this helps any, but when the market is going down, I try to avoid checking my balance. I usually wait until we've had a few up days before looking. That way, even if the balance is lower than the last time I checked, at least it's not as low as it was. Conversely, when the market is going up, I check my balances much more frequently. I wouldn't want to go for too long without checking my account, in case there are any issues with it, but what's the point in watching the carnage in near real-time and just making yourself feel bad?

While, supposedly, the world's financial markets were in turmoil/freefall/experiencing a bloodbath today, or whatever other piece of choice hyperbole our beloved news sources decided to use, I cycled to the Post Office to return some slipper socks I had bought on eBay (the vendor sent me 2 left feet). I also visited a local business owned by friends and shot the breeze with them for a while. Then I read a message from a neighbor on Nextdoor.com whose kitty had died and had free cat food to give away. I cycled over to her house to pick it up and in doing so, found that she lived in a very unusual looking building that I have long noticed. She told me it was built for a weird cult in the late 60's, about whom there is a documentary. Interesting, as I had often wondered about that place. Apparently, some rather strange and sad things happened in it. Then, with free kitty food in hand, I fed our local neighborhood street cat and spent a wonderful half-hour with him. I also took delivery of some radio parts and spent some time sorting them into my parts bins. I bid on a fantastic vintage radio part on eBay - and won the auction. Went out, had a burrito, came home, drank a glass of wine, and napped on the bed with my youngest kitty curled up in between my knees for an hour or two.

That's how I'm planning to "get through" the market downturns - by doing the same kinds of things I do every day, and not buying into the drama. If it helps, look at a chart of what the market has done over, say, the last 10 years. That should help you feel a lot better.

[Big_Hitter]

Quote:

Originally Posted by frayne My advice, turn off the boob tube and go play golf, take a bike ride, or go fishing. The ups and downs of the markets are just the natural voice of the process that you can't control.

great advice - passive investors need to chill out and let it go - otherwise any attempt at market timing will just make it worse

[Meadbh]

Quote:

Originally Posted by Major Tom I don't know if this helps any, but when the market is going down, I try to avoid checking my balance. I usually wait until we've had a few up days before looking. That way, even if the balance is lower than the last time I checked, at least it's not as low as it was. Conversely, when the market is going up, I check my balances much more frequently. I wouldn't want to go for too long without checking my account, in case there are any issues with it, but what's the point in watching the carnage in near real-time and just making yourself feel bad?

That's what I do too.

[Dog]

Thank goodness I was hiking in the mountains all day yesterday oblivious to the day's events. Didn't hear about it until the morning news today.
I'll be busy running errands all day and then back hiking in the mountains tomorrow.
I just retired one year ago, and this downturn in the market scares me, so it's best for me to stay busy and thankfully hiking is cheap.



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[TimSF]

I am surprised by my emotional reaction to this sell-off - 2 years into my early retirement - compared with sell-offs during my work years. I am much calmer now. Before - especially those last few years of working - a sell-off would mean "Gee, I now have to work 2 years or 6 months or 18 months at this terrible job to make up for the losses in my portfolio and hit 'my number'..." Now, the sell-off simply means a little belt-tightening perhaps and reallocating assets at the appropriate time. No sweat.

[heeyy_joe]

I was nervous. I went shopping. In Home Depot I saw A Chinese man spend money.

I feel better now.

[Lawrence of Suburbia]

Apparently the OP's asset allocation is too much in stocks ...?

I was actually enjoying this last week, seeing it as stocks beginning to go on sale. Given my age and vulnerabilities, I've got my allocation (approximately) 1/3 stocks, 2/3 short-term bonds and some cash ... I have enough set aside that with S.S. I could survive for a decade without touching the stock portion (were I to retire now.) I am also working to stay in a situation where all I have to withdraw annually is 2.4%.