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Is this my birthright?
Old 09-25-2017, 08:05 AM   #1
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Is this my birthright?

I retired 6 years ago.

Since than :

S&P has risen from 1312 to 2499....That about 12% annual. ( I have averaged about 8%)

Inflation has been around 2%

That just nuts.

Thinking about "dollar cost averaging" out of the market . Only problem is I will have to pay taxes on gains. Today I sold some in my IRA while I think through this a bit.
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Old 09-25-2017, 08:11 AM   #2
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Market Timer ....

This is a good plan as long as you are going to die in the next 10 years, personally I feel the market will be twice as high in the next 20 years.

Generally the market makes big jumps, then drops a lot, then jumps back up, it's never a smooth ride. The problem is how to know it has finished going up.

You will feel very smart if it drops , and very dump if next year it's 10% higher.
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Old 09-25-2017, 08:37 AM   #3
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I have a higher net worth than I have ever had in my life this week. My portfolio alone is greater than ever, despite living mostly off it and buying my Dream Home. I agree, this is pretty mind boggling. Every day my portfolio reaches a new all time high.

I always envied those who were invested during the bull market of the 1990's, but now here we are after a long bull market too.

Eventually it has got to come to an end. But when? Honestly, all "Wheee!!!" joking aside, I have no idea. It could be tomorrow or later this year. It could be next year, or it could be in another 10-20 years.

I remember 2008-2009. It was terrifying. The drop seemed so steep. Everyone said, "This time it's different". Financial reporters said the market would drop to nearly zero and would never recover. Members here tried to keep one another from panic, and there was a lot of whistling in the dark going on (from me, too).

If one does not sell low, one does not lose anything, so that is my plan. I do have some cash, always, 5.5% of my AA, and if I cut my discretionary spending to the bone that should help as well.
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Old 09-25-2017, 09:42 AM   #4
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To slow, Nasdaq down 1% already.
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Old 09-25-2017, 09:44 AM   #5
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My system to to only rebalance once a year in January and that's what I'll stick to.

Though, emotion does creep in and I hear myself saying at times, "maybe should cash in some poker chips before a future tumble .
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Old 09-25-2017, 09:52 AM   #6
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Thanks for the responses. I needed that.

Think I will just go cash for about 10%. Problem with pulling back is when to go back in..ie 5% 10%...20% or wait for the big 50%.
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Old 09-25-2017, 10:18 AM   #7
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When I sold, if I could buy back at a lower price I would consider myself successful. It is not possible to time the exact market bottom. If I lose less money than doing nothing, I am OK with it.
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Old 09-25-2017, 10:37 AM   #8
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Since last November, I have taken about 10% of the chips off the table (into bonds). But it was mainly because I reached FI at that time. I will not put these chips back no matter what the market does in the future.

However, if the market continues upwards, I might take more chips off the table, I just don't know when to put them back.
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Old 09-25-2017, 01:41 PM   #9
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I've often told the story here how, on Friday of the third week of February 2009 my "always smarter than everyone else" neighbor quite proudly announced that she just sold all of her holdings that day.

Of course, just a few days later............
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Old 09-25-2017, 01:42 PM   #10
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... I just don't know when to put them back.
Again, if you buy back at any price below what you sold, consider that a success.

If you want to time the market bottom, then you have to wait till you hear a lot of teeth gnashing, and laments of "woulda, shoulda".
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Old 09-25-2017, 01:42 PM   #11
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I've often told the story here how, on Friday of the third week of February 2009 my "always smarter than everyone else" neighbor quite proudly announced that she just sold all of her holdings that day.

Of course, just a few days later............
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Old 09-25-2017, 01:48 PM   #12
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If you want to time the market bottom, then you have to wait till you hear a lot of teeth gnashing, and laments of "woulda, shoulda".
Two moments one can buy: too soon and too late. Luckily, you can also sell on those two exact same moments.
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Old 09-25-2017, 02:02 PM   #13
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I see nothing wrong with reviewing the retirement assets owned and the level of risk to take on based on the required withdrawal from those assets. If someone retired 6 years ago, assuming needs have not changed, a 4% withdrawal rate after 6 years of 12% returns means you only need an inflation adjusted withdrawal rate of 2.76 percent going forward
. This would mean a more conservative withdrawal rate would still be practical and successful in the event of a very historic event, or perhaps one would like to increase spending to start at 4 percent again gaining 62% in spending levels. With 6 years of retirement past and the 4 percent rule still in play, you have apparently won the retirement lottery.

As a conservative type I would tend towards the first solution and perhaps adjusting to a more aggressive stance later if the market became obviously undervalued such as in 2009. But in any case I think the past 6 years have been very good to retirees.
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Old 09-25-2017, 02:54 PM   #14
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I've often told the story here how, on Friday of the third week of February 2009 my "always smarter than everyone else" neighbor quite proudly announced that she just sold all of her holdings that day.

Of course, just a few days later............
I wonder if she is now telling everyone that she sold everything in October 2007, and jumped back in late February 2009.
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Old 09-25-2017, 03:14 PM   #15
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I've often told the story here how, on Friday of the third week of February 2009 my "always smarter than everyone else" neighbor quite proudly announced that she just sold all of her holdings that day.

Of course, just a few days later............
Your unfortunate neighbor sold after a huge crash. That's not what the market has been doing recently. So, it's not the same thing if somebody sells everything now.

Caveat: I have not sold anything, other than what was taken from me by some covered call options getting assigned because they became "in-the-money". Still at 70% stock AA. I always kind of like stocks myself.
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Old 09-25-2017, 03:31 PM   #16
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Oh my, this is the kind of thread that scares me. High 5s and only upupup is the harbinger of doom.
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Old 09-25-2017, 03:47 PM   #17
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Oh my, this is the kind of thread that scares me. High 5s and only upupup is the harbinger of doom.
Lol, No, No ,No ,hahah. Only positive energy on this subject, my small caps busted a move, all time highs.

OK back to the real world, Yeah, Im gonna get crushed soon, boo.
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Old 09-25-2017, 05:09 PM   #18
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Started in 1966. An ancient graph will show the relatively flat period til 1982 and the occasional dips since then. Now I started Bogle's Folly in about 1977 and even though I tried a variety of things since then - dividend stocks, pssst Wellesley, land , rental RE, individual stocks, etc - the index fund approach has stood the test of time.

It is a violation of my male hormones to 'hurry up and just stand there' so I watch a little football in season and yes have a few good stocks(not).

2006 I went full auto for 90 plus percent of portfolio in Target Retirement. I go long periods without even noticing Mr Market in contrast to 20 years ago in early ER when I checked it daily.

heh heh heh - Hindsight for me was Mr B's stay the course' although it violates (my) human nature.
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Old 09-25-2017, 05:36 PM   #19
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One school of thought says: "If you've won the game, stop playing."

But, jeez, playing is such fun!
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Old 09-25-2017, 05:55 PM   #20
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One school of thought says: "If you've won the game, stop playing."

But, jeez, playing is such fun!
Once you have enough, there is less risk if you were to take a beating in the market. Thus, even though you have 'won the game', the urge to continue rolling the dice is strong!

Besides- if we decide to back out of the market now, when times look good, it would also be known as trying to time the market. And we all know that doesn't work.

So we would need to claim that we were rebalancing, because that is a good thing. But changing your asset allocation at a time like this would also upset the market timing sniff test!
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