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Are 25-35 year olds feeling discouraged yet?
Old 02-20-2009, 06:41 PM   #1
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Are 25-35 year olds feeling discouraged yet?

I know I am. Household conversation:

DW: How much of our income did we save in January (2009)?
DH: $2,000. We're doing a good job staying witin our budget.
DW: How much did our net worth increase?
DH: -$4,000.
DW: Uhh...how do things look for February?
DH: The budget looks great, we will have at least $1,000 left to save.
DW: And the investments?
DH: Uhh...
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Old 02-20-2009, 06:43 PM   #2
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Well, I can't speak for your range, but the 30-40 year olds are pretty darned discouraged.
I quit updating Quicken some time ago. I don't want to know more than just round numbers. I congratulate you on knowing the truth!
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Old 02-20-2009, 06:47 PM   #3
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I'm 42 and starting to get a bit discouraged. Not that I think the USA will circle the drain or anything. But the huge number of doom and gloom articles I've been reading daily are starting to pick away at my confidence.
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Old 02-20-2009, 06:59 PM   #4
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We're not discouraged. We have years to catch back up and a lifetime to live. Winston Churchill said "Let our advance worrying become our advance thinking and planning." Things might be changing; we're young enough to change with them.
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Old 02-20-2009, 07:05 PM   #5
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Originally Posted by soupcxan View Post
I know I am. Household conversation:

DW: How much of our income did we save in January (2009)?
DH: $2,000. We're doing a good job staying witin our budget.
DW: How much did our net worth increase?
DH: -$4,000.
DW: Uhh...how do things look for February?
DH: The budget looks great, we will have at least $1,000 left to save.
DW: And the investments?
DH: Uhh...
I'm 43 and have been investing for retirement for 20 years. In 2008, we saved about $30,000 but our net worth dropped by about $140,000.

If the market is going to tank on you, being young is the best time for it.
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Old 02-20-2009, 07:09 PM   #6
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Maybe this will help

Quote:
Originally Posted by soupcxan View Post
I know I am. Household conversation:

DW: How much of our income did we save in January (2009)?
DH: $2,000. We're doing a good job staying witin our budget.
DW: How much did our net worth increase?
DH: -$4,000. Our net worth increased by 145.88 shares Vanguard Target Retirement 2030. We're buying a lot, they are on sale right now--they cost about 40% less than what we used to pay a year ago.
DW: Uhh...how do things look for February?
DH: The budget looks great, we will have at least $1,000 left to save.
DW: And the investments?
DH: Uhh... They are primed for a launch. I don't know when it will happen, but it always has in the past. We own more shares today than we ever have in our lives--some great companies. When the share price goes up, and they always have, we'll be in clover.
Sometimes we have to have some "creative" positive self-talk to maintain the motivation to do what we know is good for us.
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Old 02-20-2009, 07:09 PM   #7
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At 25 I'm not really discouraged, but it is never fun for anyone to lose money.

I just hope I remember this as I approach retirement age and make sure I'm not too heavy in stocks when I can't afford years like this.
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Old 02-20-2009, 07:10 PM   #8
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Aw, you kids have it so easy today. Stocks at ridiculously low prices; decades before you need the money. We had to walk through snow to buy mutual funds.
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Old 02-20-2009, 07:13 PM   #9
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Aw, you kids have it so easy today. Stocks at ridiculously low prices; decades before you need the money. We had to walk through snow to buy mutual funds.
Cue the Four Yorkshiremen!!!

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Old 02-20-2009, 07:37 PM   #10
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Darn you old timers, just when we were getting ready for a nice big cry.
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Old 02-20-2009, 07:41 PM   #11
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We're not discouraged. We have years to catch back up and a lifetime to live.
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If the market is going to tank on you, being young is the best time for it.
Urchina and Ziggy summed it up well. On the other hand, I don't check balances more than a couple times per year. If DH and I were having this conversation every month, he'd be downright depressed. Have faith! I figure if all the early retirees here did it, there's no reason we can't do it too.
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Old 02-20-2009, 08:14 PM   #12
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29/yo not discouraged, yet. However if I get my #ss laid off from work things may change quickly

I guess stocks can be considered 'cheap' (again this is a relative term) compared to inflated prices in 2007, but the same can be said about housing as well. Both fueled by easy and available credit. I was reading recently about how the S&P500 is trading at about 13.5 P/E which leads me to believe the downside risk from here is another 25%. When stocks trade at 10 P/E and the S&P stands at 600 or so, I guess I can say for certain that 'stocks are cheap'. DCA all the way down. Buy, buy, buy.

My time horizon is about 30 years and the hope is that I can outpace inflation and taxes by a 1-3 percentage points each year. But as I've said in other threads, if nothing else, my expectations for investment gains and ER have to be tempered a bit. I just have to laugh at the Dave Ramsey's and David Bach's of the world assuming 10% ROI on index mutual funds. Nope no way, sorry. The only guy guaranteeing that over the past decade was some guy named Madoff.
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Old 02-20-2009, 08:16 PM   #13
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Ah, yes, I remember it well. At age 25 I thought I would never afford buying a house, ditto at age 35, and now, plus ça change, plus c'est la même chose. Still renting in an expensive city. My French hasn’t improved either.

On the bright side, at age 25-35, my PF seemed to stand still, but now despite many downturns is good enough to support me in RE. Keep the faith, baby. What Samclem said & the Yorkshiremen.
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Old 02-20-2009, 08:41 PM   #14
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Far worse than walking through snow, We?I had to talk to brokers and pay a load to buy mutual funds . Buying stocks might cost 5% or even 10% commission. Plus researching stocks involved a trip to the library to get your hands on Value Line.

No CNBC either, just Louis Reykeyser (sp) and his merry band of elves. I wish I was 25 again in a bear market, instead of retired.
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Old 02-20-2009, 08:52 PM   #15
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I know I am....
I hear you... lousy market returns, coupled with me trying to unload an unbearable job in a questionable economy. Sometimes... when it rains, it pours.
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Old 02-20-2009, 09:01 PM   #16
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No CNBC either, just Louis Reykeyser (sp) and his merry band of elves. I wish I was 25 again in a bear market, instead of retired.
No you don't. At least now we can stay home all day and obsess over CNBC between frosty beverages analyzing stocks and napping working out. Back when we were 25 we were expected to obsess over the markets and show up to work at the same time...

In 1985 when I was 25 I was standing midwatches and trying to get off the "qualification delinquent" list. No goin' back to those good ol' days.

Spouse and I have noticed that we're in much better shape today than we were in 2000-2002. So, yeah, this hurts and it might hurt for longer than it did in 2000-02, but we know how to deal with it.

When the markets eventually hit bottom and start thrashing around in the mud, the young'uns are going to start partying like it's 1982 again!
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Old 02-20-2009, 11:47 PM   #17
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I am 34. Still checking Quicken everyday. Not discouraged yet but only because income-wise, things were great and just got better in the last 2 days. Despite market losses approaching $200K since October 2007, our net worth has remained more or less stable thanks to hefty inflows. As long as we can manage to keep our net worth up there, we see no reason to get discouraged. The average household's net worth has probably trended down substantially over the past year and so, if we can manage to keep ours flat, we are actually becoming wealthier relatively speaking. I also focus less on account balances and more on building my passive income. We have made great progress in that area in the past year.
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Old 02-21-2009, 12:56 AM   #18
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47 and hammering down my cost basis every two weeks. Like FIREdreamer with large inflows this past year and paying down the mortgage we are staying even NW wise.

DD
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Old 02-21-2009, 01:24 AM   #19
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You should not feel discouraged at your age. William Bernstein (of The Four Pillars of Investing fame) would say that, at your age, you should get down on your knees and pray for times like these. The investments you make now, at these prices, will be the foundation of your future wealth. Congratulations! (Now keep your job and save, save, save!)

Older people who have just entered retirement are the truly worried ones, with good reason: they are making withdrawals at the worst possible time.

For someone like myself who was approaching FIRE? It's pretty unfortunate. But at least I've got some time before the "early" in E.R. would become a misnomer, and a very secure job, so I hope to wait this crash out while dribbling a little more money into the markets as I can (I only wish I could keep up with my losses).
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Old 02-21-2009, 02:27 AM   #20
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.... (Now keep your job and save, save, save!)

Older people who have just entered retirement are the truly worried ones, with good reason: they are making withdrawals at the worst possible time.

....
Some of us older people are actually less worried if we are among the ones who re-arranged our allocation to have many years in CDs and other fixed income investments. I would be more worried if I were working and might lose my job. But all in all this a very bad time for all of us, IMO.
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