How About Just Sitting Tight (and Having a Cocktail)?

[marko]

As I've noted on other threads, I'm using this drop as an opportunity to "go back in time" and buy a stake in an S&P index fund; something I should have done a year ago but didn't.

Now it is September 2014 all over again. Of course, I'm betting on the S&P regaining itself, but I'm pretty confident.

I view it as that "missed boat" coming back to pick me up.

[audreyh1]

It would have to drop quite a bit to force me to rebalance. I hate rebalancing in Q4 when I get a bunch of distributions. If it happens sooner and reaches my threshold, I am obligated to rebalance.

I hope folks who had limit orders waiting for a drop don't regret they didn't wait for lower prices.

[Theseus]

Being an optimist, I'd say the dividend yields on equities are pretty attractive this morning. Having enough cash reserves set aside to sit out 5 years, I have little reason to be pessimistic. As long as I don't squander cash on a too early bargain hunting spree that is.

[Moemg]

I am sitting tight . I learned my lesson in 2008 -2009 . These drops do knock me into a somewhat more frugal mode but otherwise life as usual .

[nun]

As I don't use my stock and bond investments for income I just do my usual rebalancing whatever the situation.

At times like these living off pensions, annuities, SS or rent makes it easy to sit tight. However, if you are recently retired, didn't build in enough of a fixed income/cash cushion and have to sell into a prolonged downturn it could be nasty.

[2017ish]

Not retired yet, so we'll buy with 401k contributions four times each month, and every month with after-tax.

Sort-of-good news is that this is getting my asset allocation closer to where it objectively should be.

[Looking4Ward]

Not doing anything. Part of sitting tight means I don't have a large stash of play money waiting for a buying opportunity. The next 4 years of living expenses are sitting in Wellesley and I don't even need to touch it until next January. Years 5-15 are sitting in Wellington and years 15+ are in a mix of Wellington, Vanguard Health, and Vanguard Energy.

What I do hope, however, is that the fund managers are doing what I pay those fund expenses for. And that would be to make the smart buy/sell/hold decisions that they should be more qualified to make than I am.

[OnTheBeach]

Sitting tight as well - My 8% cash position will cover my living expenses for a few years so i don't have to worry about the markets. Now I just need to pull the trigger and resign....and go play golf.

[W2R]

Sitting tight: - - Nah, my plan for today was to invest half the money I got last Thursday afternoon from selling my house. I will DCA the rest over the next few months. So in accordance with my plan, I invested already this morning.

At least, I think I did. Vanguard said there might be a delay because the money has not cleared the bank (despite the fact that both my Vanguard balance and my bank balance agreed earlier this morning that the money is at Vanguard). Then Vanguard seemed to crash temporarily and I couldn't even get back in for a few minutes, which was unnerving.

Having a cocktail: - - Isn't it a little early for that? I don't drink, so I am enjoying the unusual third cup of coffee instead while I watch the market tumble. Extra creamer, please!

[RunningBum]

I've got a year or so sitting in cash that I could jump in with...but I'd just need to be selling something to live on again soon, so if it keeps dropping I'd be losing out. Still, I feel like I have to do something...so I'm going for a hike...and I'll have a cocktail later. At some point I'll look at whether I need to rebalance.

[ExFlyBoy5]

Well, if I were going to rebalance some holdings today, it might be a little difficult...

[Olbidness]

Interesting comments from people I work with. Stocks going down means time to sell.
Typical herd mentality.


Since I'm still w*rking I'll buy every two weeks when I get paid. Just like always.

[FI by 2024]

I've been sitting on cash since selling a home in May. I've been debating between investing the money using DCA and paying off my other house. I decided ~2 weeks ago to start the DCA, so while I am starting to buy now and I can see how it might look like market timing, in reality it's just fortuitous timing. Not that I am complaining!

I plan to DCA the entire amount between now and the end of the year, so if the market goes back up I will catch a small break now, if it continues to drop I will continue to get in at lower prices. Since the money was going into the market no matter what, I wouldn't mind if this drop hadn't happened. I see it the same as if I'd gone to buy milk an found a $.50 off coupon when I reached into the fridge. I was buying the milk anyway, but I'm happy for the discount.


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[ExFlyBoy5]

Quote:

Originally Posted by Olbidness Interesting comments from people I work with. Stocks going down means time to sell. Typical herd mentality.

And these are the folks that will be 70+ years old and can't figure out *why* they can't retire. I am looking forward to buying some since it looks like a good discount. But then again, I might just sit where I am. Oh, decisions, decisions!

[ArkTinkerer]

I retired at the start of this month. All those simulations show that the biggest gotcha is a market decline right at the start of retirement so I am a bit worried! Have a big chunk of company stock but at least I had the foresight to put a stop loss on the shares I was going to sell early next year (next year I expect to be in a lower tax bracket). I will be moving money from the 401K to rollover IRAs at a few other brokerages. Other than that I'm just going to ride it out.

[W2R]

Quote:

Originally Posted by FlyBoy5 Well, if I were going to rebalance some holdings today, it might be a little difficult...

Keep trying! I think the Vanguard website has been overloaded by all the traffic due to this crash. You might be able to get in now.

[antmary]

We don't live on our stock/bond investments. But, right now, our stock allocation is too low...will start to DCA this week.

[ExFlyBoy5]

Quote:

Originally Posted by W2R Keep trying! I think the Vanguard website has been overloaded by all the traffic due to this crash. You might be able to get in now.

I was finally able to get in, but it's just too volatile for trading (for me, anyway)...so I'm out for the day. Others can be happy that I have freed up some bandwidth.

[Mulligan]

Quote:

Originally Posted by FlyBoy5 Well, if I were going to rebalance some holdings today, it might be a little difficult...

Same here. I just wanted to poke in account to see live quotes only. Vanguard is hell bent on making you a "buy and hold" investor!


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[Major Tom]

I don't know enough to feel confident doing anything other than sitting tight. Dyed-in-the-wool passive index guy here due to my lack of knowledge and ability to do anything more. In a strange way, I'm rather welcoming this. It is the first serious drop/correction/whatever-it-is since I shifted from accumulation to withdrawal in 2011. I regard this as my first "seasoning" and am quite interested to see how I handle it. I think my INTJ nature helps in this regard.

My strategy for dealing with this was to break my monthly budget last night by dipping into next months money by just a little. I used the extra dosh to order some more parts for my hobby of building radios. I'm working on a project that has been going on since the beginning of this year and am keen to finish it so I can document it fully on my blog. This hobby takes up a big part of my days.

In other words, I'm concentrating on my daily life, the same as I always do. I have about a year's worth of cash which means that combined with dividend payouts, I should be able to keep going for about 2 years if the drop is extended and dividends drop a little also.

This will be interesting. I welcome it!