Poll: Stay the course or Sell it All. May 2020

[gauss]

I planned for this type of event since 2015 knowing I was retiring in 2020. I bought laddered bonds out 7-8 years plus from my retirement date. Dialed back equities over the last few years. Plan to slowly add back into equities over the next few years as bonds mature. Kitces’ rising equity glide path model. Now I just let my plan work. I really don’t have any concerns.

+1

I changed my AA last year to 45 Stock / 55 Bonds in an attempt to setup the rising equity glide path to mitigate SOR risk also.

The bonds are throwing off regular income and since I formed a 10 year ladder, there is plenty of bond principal in case I need it. FWIW I used the Bulletshare target-maturity ETFs to easily implement this.

I will hang onto the stock funds and not watch it too closely. Not interested in market timing ,in that I have already won the game (ie retired - enough money) and I am not trying to maximize anyone's inheritance.

If I were still working and looking to retire, I would probably be much more concerned about market behavior.

 

[mamadogmamacat]

staying the course I went to 40% equities 5 yrs before I RE (which was nearly 5 yrs ago) and have stayed there ever since, so already more conservative than some. As a nation we have dealt with worse than the current situation, with all its uncertainties as regards what the outcome will look like once we are past this and able to look back on it, more than once in the past.

 

[Katsmeow]

Voted pie since I really wasn't sure what to say. I haven't sold it all and don't plan to sell a lot (whatever that means). I did switch out my mid cap and small cap funds to the total stock market fund. I had been planning to do that as part of simplification right before this happened. Then when everything went down, I was hesitant whether to go ahead and do it. I did do it.

There is a possibility I may make an asset allocation change. I had been 55/45 for years but was planning to go to 50/50. Basically I felt that DH and I had gotten old enough that was warranted (DH is 72 and I am 66). I even thought about whether I should go to 45/55 or even a little lower. But before I really decided everything went down. As it turned out when everything went down that sort of took care of the asset allocation. I'm now at 46/54 and will probably hold there. It is possible I might go to 40/60 but no plans to right now.

 

[DrRoy]

I don't see how the market is holding up as well as it is with what must be happening to earnings and how long it will last. However, I am pretty convinced that if I get out it will be the wrong thing in the long run. I do think that we may have seen the absolute bottom in the economy, as even partial reopening will stop the fall, even though the recovery will likely be slow until there is a vaccine.

 

[Ronstar]

Staying the course. I got out for a while in y2k, and vowed to never do it again.

 

[Markola]

At ages 55 and 57 we are using the Rule of 55 to bridge to 59.5. DW is doing that already and now my job is in some question. A couple of weeks ago during this “bounce back” I moved about $300,000 in already-conservative Target 2020 funds in our 403b and TSP into a bond index and G Fund (Treasuries) respectively. I left the longer term IRAs and Roth’s alone at 50/50. Net effect is, I sold about 10% of our stocks at June prices to gain peace of mind for 3-5 years.

It seemed a prudent adjustment since our need to use the money has emerged now, after a decade long bull run, when all asset prices were already high even before this pandemic-based recession.

 

[Red Badger]

Key Lime Pie.

I bought some equities in late March. Since then, I became more convinced that the recovery may be slow and perhaps we've not found the bottom yet. Decided I'd sleep better with 10 (+) years of after tax assets, so I sold same. I got lucky, as I made about 10%. But that was just that - luck. I'm not a market timer. I'm okay if I miss any run up profits. Pigs get fed -hogs get slaughtered.

 

[Helen]

Key Lime Pie.

Trader Joe's has a seasonal frozen key lime pie that is to die for!

I sold some individual stocks late in 2018 and kept it in a MM, then sold some more individual stocks the first two days of the sell off (was going to do it anyway based on an article about supply chain disruptions.) I put some of the money back into iTOT and a big chunk into an Ally penalty free CD.

I am doing the dirty market timing thing with the CD money. My long term plan as been to move out of individual stocks and into index funds/ETFs. A down market in 2021 would help to sell off and reinvest the remaining stocks.

 

[Earl E Retyre]

I did not sell it all … I am not staying the course … I did reduce my equity exposure. So, I am not sure if that is other or if that is pie. Not sure what pie means - unless we are talking apple or moon. So, I voted other.

 

[IMATERP]

I planned for this type of event since 2015 knowing I was retiring in 2020. I bought laddered bonds out 7-8 years plus from my retirement date. Dialed back equities over the last few years. Plan to slowly add back into equities over the next few years as bonds mature. Kitces’ rising equity glide path model. Now I just let my plan work. I really don’t have any concerns.

Ditto....

I

 

[Rex]

Steady as she goes....Been there, done that.

 

[Running_Man]

Stay the course, no brainer. I did in ‘87, ‘00 and ‘08-09, why change now? There’s a correlation between stay the course and FI, so this is not a typical audience for such a poll. I’m glad.

The logic is overwhelming, yet the belief that markets only go up in the long term is so ingrained that logic is ignored which shows why the stock market is valued so highly. One thing is fairly certain, the value of the stock market relative to GDP on May 8th is going to be the most overvalued level in the history of the Wall Street. One has an opportunity to cash out at nearly the highest value of stocks to GDP on a normal economic metric if one were to totally dismiss the dismantling of the economy. Indeed one could sell and set a rebuy point if the market were to even go up to 3100 on the S&P500 and risk a pittance of upside gain missed while provide a major risk unload on a very likely decline.

 

[Whisper66]

Voted "Other" - Increased asset allocation from 47/53 to 80/20 during the downturn. Taking advantage to increase equities during downturns is part of our financial plan.

 

[VFK57]

Sold MIC after they cancelled dividends (with a big loss) recently but the rest is: stay the course and voted so.

 

[Badger]

I considered selling some for a larger slice of cash a couple of years ago but didn't until the end of last year while the market was still high. Glad I did. Now I am in the catbird seat if the market takes a downward turn and if I want to buy a little. Otherwise I'm good for forever (for us that may be 15 years if luck holds up) and the kids will be set too unless they do something stupid. I always stayed the course while working and contributing to 403b and Roth. It's a little different when you are retired and past 70 with no mortgage, no debt, medical taken care of until the bucket is kicked, want to be stress free, have the option to blow the dough, and have enough for a good inheritance for each of the grown kids.

As long as the dollar holds most of its value and doesn't go the way of a Confederate dollar we will be fine.



Cheers!

 

[ejman]

I have been a steady 50/50 with wide rebalance bands since ER at the end of 2002. This present unplesantness has made me think of a few things. a) I'm going into my 70's now so time in front is reduced, b) there really isn't a huge difference per firecalc with ranges of about 30 to 70 % of stock, and c) the stock market has given us a gift of retracing a great deal of the March loss.


So, this felt like a good time to ratchet down to a 40/50/10 level, again with wide rebalance bands. If this makes me a dirty market timer for the first time ever so be it.

 

[gwraigty]

I voted stay the course, but I've been slower at putting new money to work, although I still intend to buy the same investments, so I think I answered correctly.

 

[pacergal]

Other--
Had been moving down to about 50/50 already.
Now plan to hold the course from now on, with updated investment plan.

 

[Happyras]

I am back, long time no post...voted other
I held on through the March dip and subsequent rise. My "retirement" tax deferred accounts were essentially 100% equities, but most of our net worth is in taxable other assets like real estate, notes etc. So I felt the equities risk is too high, not so much upside, if any, for the next few years. I started selling a few weeks ago at S&P 2830, and did a little more through Monday this week. I believe we got down to 70% equities, but as of today that is looking like 65%. I wish I had sold my real estate funds as we have too much in real property as it is. Going forward, we have no plan to increase this exposure, but there is no great opportunity currently for the cash. All the best to everyone!

 

[tdv2]

No major changes for me. Did a small re-balance move and some Roth conversions in March but that's it.

 

[RobLJ]

I had decided on a glide path, so took most 2018-early 2020 gains in 2nd half of 2019 and from Jan-early March 2020, to reduce from 58% stocks to 48% stocks by the first week of March.
Sold a little more near the end of March to get to 43%, then the rest of the slump took me down to 40% stocks, so I bought enough from cash to get to 43%. 40% is my low level where I'll rebalance back up to 43-45%. In 4 years after drawing SS I will increase back up to 50-53%, then to 60% in 8 years when DW hits full SS age.

 

[Splash]

Voted staying the course.

Did some Roth Conversions in March. Moved some small and mid-cap index funds into total stock market index consistent with my simplification plans.

 

[SecondCor521]

I voted "Other" by mistake because I actually increased equities in February and March. But this poll is about May, so I'm actually staying the course and intend to do so going forward. I have nothing I'm waiting to do (financially speaking).

 

[Vincenzo Corleone]

Went from ~70/30 to ~30/70 on Feb. 24th with S&P at 3225.89. I'm retired, DW to retire in a couple of years. Considering doing the glide path thing.

 

[Winemaker]

I voted other, I'm staying the course. But my course is different than most, I keep 3 years of withdrawals in a stable value fund. After my draw in January, I sell quarterly some of my holdings to refill the stable value fund, sorta like a DCA in reverse. My dividends, and interest are reinvested, but those dividends and interest, are more than my draw so far after 5.5 years. All is good.