Join Early Retirement Today
Thread Tools Search this Thread Display Modes
Old 07-16-2013, 02:53 PM   #21
Full time employment: Posting here.
Join Date: Mar 2008
Posts: 735
Since I'm close to retirement, I'm holding more cash than what I'll likely hold 2-3 years into retirement. I just don't want to be surprised by an unknown and have to sell in a down market shortly after retirement. I've read the studies about a down market early in your retirement causing your plan to fail.

That said, if 2008-2009 taught me anything, it's to not be afraid to sell poorly run companies when the market is down. While I re-invested the cash in good companies then, I wouldn't be opposed to doing the same in the next down market to meet cash needs. I'd prefer to re-invest though.

akck 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 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 07-18-2013, 03:38 PM   #22
Recycles dryer sheets
Join Date: Jul 2013
Posts: 108
Originally Posted by LOL! View Post
It seems to me that lots of folks hang tough when the market is down, but many don't rebalance into the things that have dropped. A target retirement fund or a balanced fund like Wellesley or Wellington will do that for them without them even knowing it.
Either that, or you do it yourself. Bonds, US stock, Int'l stock, Small, Large, whatever category, it doesn't matter. Just sell what you strictly need, and sell whatever is at its highest point relative to your target asset allocation.

Such reverse rebalancing is such a simple rule, and yet it should work beautifully in the long run, while avoiding to get emotions and gut feelings mixed in the process. In addition, if you do a full rebalancing, you'll buy other categories at a low point, and be very happy in the long run.

Now why do people keep large pockets of cash instead of just using such a rebalancing procedure? Beats me.

Disclaimer: I'm not retired yet, so... although such approach makes 200% sense to me, I've never used it for real, so... what do I know...

siamond is offline   Reply With Quote

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


All times are GMT -6. The time now is 03:45 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2018, vBulletin Solutions, Inc.