On the seven-years living expenses thread, Chuckanut made the following, sound post:
To those of you who have retired, did you find that your "ability to sleep at night" tolerance for swings in the market change much? It is easy for me to think that we have very high fluctuation tolerance, as we never have thought about getting out of 100% (now 95%) equities since we started investing in the mid 80s. But, I suspect that one's tolerance may change when there is no longer a dual-income streaming in.
Thoughts?
One thing that must be considered is the human emotional element.
If one's ability to act rationally in the face of a relentless bear market is strong, then keeping a big cash buffer is not necessarily useful.
If one is going to panic and sell low, then having the extra cash security blanket that will reduce or eliminate panicky selling, is a good idea.
Know thyself. Just my 2 cents.
To those of you who have retired, did you find that your "ability to sleep at night" tolerance for swings in the market change much? It is easy for me to think that we have very high fluctuation tolerance, as we never have thought about getting out of 100% (now 95%) equities since we started investing in the mid 80s. But, I suspect that one's tolerance may change when there is no longer a dual-income streaming in.
Thoughts?