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Old 08-03-2018, 11:39 PM   #41
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Business owner in mostly new construction work. Had been 18 years at that point. I had trained a superitendent in all facets of the business. Was getting very close to selling the business to him. I can't remember if if it was Jan of '07 or '08 but everything ground to a halt. Probably '08. ADC loans (development of bare ground) and home sales cratered. So not only was nothing selling but there wasn't anything in the pipeline (ADC). By June I had to lay him off. Then most of the crew got laid off. We had 17 trucks in 3 markets. During the worst of the crash we would have 1 or 2 trucks working some days.

At that point the name of the game was cash flow. I cut our salaries 3 different times. We stopped contributions to our Vanguard accounts. Sold off trucks. Contractor would call with a remodel project and I'd say I'll be right over. (LOL) I was really questioning if the business was even viable. But...what else am I qualified to do? Nothing. All I knew is construction. Looked briefly at driving a school bus. But that would have conflicted with answering the few calls that came in.

Very scary time. WoScrapr & I came to be much closer as we hunkered down together. Lots of long walks in the evening as I tried to figure things out. Later in '08 I think we hooked up with a company doing foreclosure clean outs. Loan servicer would foreclose and the owners would leave stuff in the house or property. We went in and cleaned it up. Saddest vision I have was a home where the wedding dress was draped over a stair case. It looked like it was one of those last minute decisions...do i take or do I leave? Brutal

That provided at least a bit of cash flow. Rates to do the work were low and the work was sometimes nasty. But it was a tiny bit of cash flow. We did that for 4 or 5 years as construction came back.
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Old 08-04-2018, 01:09 AM   #42
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I'm impressed that most of the posters were not fazed, although Scrapr's post reflects the microeconomic reality at the ground level.


I had a secure job. But I had experienced the beginning of the Southwest Savings and Loan Crash in '90, then moved back to Houston from Cali just before the Cali real estate "recession" in the late 80's/90's, so my own experience in '96 was to suspect, oh, sh** this could be a national Real Estate crisis. So I reduced stock mutuals from 95% to 60% from '05 to early '08, buying intermediate treasury funds and cash gradually, and with stock mutual gains. The gains were such that I had to keep buying bonds/cash even though I didn't really want them.

I was also about to turn 50 so that also was a huge factor.

Did I feel good when the crash that I feared actually happened?
No, but it did diminish the damage--significantly. I also rebalanced back into stock funds in late '08, '09, and early 10, not so much with the cash but more with new contributions.

Basically, actions before '08 and buying in late '09 and '10 paved the way for semi-retirement in '15.

It was a brutal time, and much more for the lower income workers in the US, many of whom never recovered.

I was lucky. I'm not sure if the stock "boom" had continued for another year or two if I would have persisted in what seemed a rather severe reallocation I started in late '05 and continued through '07 (I sold stock mutual gains gradually.)

My wife worked for Dynegy in the early 2000s during the Enron bust, so that also factored. In her case, all matching 401k contributions had to be in company stock that she couldn't sell (this is an important point that was changed post-Enron), and I watched helplessly through the Enron bust (Dynegy bought Enron's pipeline and was dragged down into bankruptcy as well.) I had told her we should buy options against her stock while it was in the rocket to the moon mode. It was an important lesson in risk assessment and diversification.

I have been scrupulously scraping gains over the last 3 years, even though I don't think conditions are anywhere similar to '07 or '00 (tech).

Just keeping the allocation and enough cash to maintain through a correction until SS kicks in.
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Old 08-04-2018, 01:20 AM   #43
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In '09, I thought we would be working until 65-70 after going down another 28% in '08-09 (after the earlier Dynegy debacle), so I'm not a visionary, in case my post makes it seem so.
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Old 08-04-2018, 04:14 AM   #44
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In September '08 we were working in Louisiana, 16 months out from planned retirement. We didn't do anything different, just kept putting the max into our 401k's and kept the same AA which was around 60/40 at the time as we were so close to retirement.

Over the following year half the production units were mothballed (Chemical site) no employees were laid off, but plenty of contractors. Skilled operators from mothballed units did guard duty, janitorial services, painting, documentation updates etc. No annual bonus for the next 2 years but so grateful to the company for staying the course and being ready for the economic upturn when it came. My wife's chemical company followed the same course of action. We retired as planned in January 2010 and later that year I received an unexpected 20% bonus check on my 2009 salary.
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Old 08-04-2018, 05:25 AM   #45
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Impressed by the many who didn't wet the bed!

I was/am in the commercial real estate business back then, self employed with 4 kids and a SAHW with an 80/20 AA then so yes, I did wet the bed! Frankly, I felt completely paralyzed at the time. I watched my portfolio take 7 figure paper losses for a period of time and then did hit the sell button with about 25% of my dough. The only good news is I shortly thereafter came to my senses and bought back in on no other reason at the time other than I figured I would tie my wagon to Uncle Sam... if we fall into the Dark Ages, I will have allot of company, right!

Fast forward, I feel like I learned a valuable lesson about staying the course. That being said, I cannot help but be somewhat concerned of a big correction the day I launch (end of 2019).
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Old 08-04-2018, 06:29 AM   #46
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I was working with a group of 6, myself being the second youngest.45% of my 401K was evaporated during that meltdown.As I watched the older group pull what remained of their 401's into cash, I maxed mine and went all in.Made an incredible amount of money in 2009, stayed the course and signed my retirement papers last week.
As Warren said:
"Be greedy when others are fearful"
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Old 08-04-2018, 06:36 AM   #47
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My employer saw the eminent bankruptcy in their future and offered buy-outs to everyone close to retirement age. I was only 52 then and the deal was not sweet enough without other income. I contacted the company who had offered me a job in January 2008, and which had not yet been filled, but they saw the impending doom too and had decided to not bring on additional employees.

So I had to stay at a company which, for the next two years, would randomly send Security Personnel into working departments to escort individuals to their cars with a single box of personal property. Anything more than one box would be packaged by the Supervisor and shipped to the employee's home.

Pensions were significantly cut for those with under 30 years of service (I had 30-1/2 years). Some co-workers with only a couple years less service than me lost 35% of their future pensions!

I stuck it out for four more years, endured two rounds of age dependent forced lay-offs, saw my pension frozen and replaced with a defined contribution only plan, learned my name was at the top of the list for the third forced retirement program because of my seniority, so I resigned via their retirement program and got another job, taking my frozen pension with me.
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Old 08-04-2018, 06:37 AM   #48
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In the middle of two things:

- BIG layoff at work and warnings to us that everything will change. Boy how it did! Many reasons apply to the fact that my base wage at Megacorp today is only %2.5 higher than then. After bonus, it is lower in real terms.

- Buying a car! DW needed one badly. Car companies were dealing because the problems were working their way into these kinds of purchases. Recall also $4 to $5 gasoline just a few months before! I figured, what the hell, let's get the car. It at least is a hard asset of sorts and won't go to 0 which is apparently what my investments will do.

The one thing I remember from that September is the look on Bush's face during the legislation discussions. It looked like he saw a ghost.

BTW, I was fazed. Oh yeah. Luckily, I didn't liquidate or anything. I stayed the course. I was not ballsy enough to buy real estate like some of the confident posters here. No bragging from me, I was worried. It ultimately did delay my ER mostly out of fear.
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Old 08-04-2018, 06:47 AM   #49
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I spent every week traveling extensively for work--working megahours. Little did I know every 30 year/55 year old employee was going to be sent home with an ER termination package. Megacorp overreacted to the economic times of 2008.

Now they are running a $15 billion company with people with little or no experience and many jobs subcontracted out. The forced ERs was the best thing to happen for the employees.
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Old 08-04-2018, 07:00 AM   #50
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At the time, 47 with 2 kids at home and DW started having severe heath problems and could no longer work.

I had a very good job but was stretched to meet the lifestyle we built, especially with medical issues. (Stress and money)

401k was 100% equities - so I felt like yakking on my shoes for about 2 years. Stayed the course and kept contributions up. Glad I did not sell like some coworkers.

A bit of a news hound, and watched with horrid fascination the dominos start fall to what looked like the collapse of capitalism.

One great example is cars - we had just upgraded to a newer used car with loan when the credit markets began freezing up and no one could get a loan. National talk about letting the big three go under. Ford motor stock hovered around $2 and if I had a few spare nickels I would have bought in.

Friends began losing jobs and stopped paying mortgages.

Unfortunately- history repeats itself.
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Old 08-04-2018, 07:03 AM   #51
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We were in the middle of concluding the purchase of our 1st home in Mexico. We were in the US and and watching the stock market slide with one eye and the currency markets with the other.

But it all worked out and here we are in 2018 living in our 2nd Mexican home.
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Old 08-04-2018, 07:08 AM   #52
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One great example is cars - we had just upgraded to a newer used car with loan when the credit markets began freezing up and no one could get a loan. National talk about letting the big three go under. Ford motor stock hovered around $2 and if I had a few spare nickels I would have bought in.

...

Unfortunately- history repeats itself.
We're waiting for the next recession to buy a car. Hopefully, the next brand we buy will exist the following year.

DW has a Pontiac. Actually a NUMMI car. GM/Toyota killed NUMMI after the 2008 debacle. Fortunately, other GM brands still service it, although we have found it is a bit of an orphan of sorts and sometimes causes confusion or delay for things like recall.
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Old 08-04-2018, 07:11 AM   #53
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Right!

Everybody at that time, if they are still here, will remember you as the poster who used the most in his posts.

When I pass at least I will be remembered for something.
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Old 08-04-2018, 07:43 AM   #54
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15th year of ER having been ballpark 60/40, Boglehead convert for a long time AND having gone more or less full auto via Target Retirement index fund in 2006 I 'stayed the course'.

heh heh heh - investor since 1966 I stayed calm Right? Nope. Gervous and Nerky I lurked on Bogleheads, here and other other forums, piddled with a few good stocks and watched football. Thus stalling my way to victory. Love the smell of full auto index funds.

I had been a low level corporate officer at AIG, so through stock options my $28,000 aggregate cost-basis had grown to a $70,000+ value. But I wasn't following the news (I was no longer employed there in 2008). On my computer at a coffee shop I read an article about AIG's financial troubles, so took a check of my stock holdings.

I don't recall exactly, but at that point they were worth maybe $3000. I made a mental note to check further when I got home, but forgot to do so. Literally in the next day or so they were worth about $900.

But I learned my lesson that being an individual stock-holder is not for me. After discussion with my Vanguard advisor, I sucked it up and sold the AIG stock, along with the rest of my stock holdings (I never had a lot, anyway) and became an Index investor. That AIG loss was painful, emotionally, but fortunately in the grand scheme of things it wasn't critical to my retirement plans.
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Old 08-04-2018, 11:25 AM   #55
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I was working and DW was too. She ended up losing her District Manager's job at a commercial real estate company and technically retired at that moment.

I was still consulting (oilfield mostly) and stayed well employed. I remember myself and a worker mate setting up a table of great companies with common stock was selling at under $10 per share. We were going to put $10K into each one and hold on, but never did (big, big mistake) (remember Ford at $1.40/share?)

Anyway, I decide to buy another house in our area for DD to live in and was bidding on foreclosures and bank repo's @ $60 square foot. I never hit on the one's I bid on, but did snag a 2,000 sq. ft., 3 year old brick ranch that was a rental for $120K. Beautiful house in a great Woodlands neighborhood. The house is now valued at about $220K +. I should have bought a few more!
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Old 08-04-2018, 11:31 AM   #56
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Both DH and I worked for govt. so luckily did not lose our jobs. So many people underwater on mortgages, foreclosures and job loses everywhere. Scary times. Didn't like opening my investment statements and seeing the numbers go down consistently, however, I clearly remember my Dad saying "the stock market will recover, give it time, Gains and losses are only on paper until you sell". He was my reassuring guiding hand. Thanks, Dad!
Retired a few years earlier than anticipated.
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Old 08-04-2018, 11:40 AM   #57
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Anyway, I decide to buy another house in our area for DD to live in and was bidding on foreclosures and bank repo's @ $60 square foot. I never hit on the one's I bid on, but did snag a 2,000 sq. ft., 3 year old brick ranch that was a rental for $120K. Beautiful house in a great Woodlands neighborhood. The house is now valued at about $220K +. I should have bought a few more!
I'd like a ranch. A neighbor will be selling in 5 years. If there is a recession then, or a downturn right before (quite possible), will I have a fortitude and cash to buy it? I hope so. Right now, the market is way too hot.
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Old 08-04-2018, 11:40 AM   #58
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I'd like a ranch.
How many acres are you looking for?
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Old 08-04-2018, 11:45 AM   #59
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I was just over two years post-FIRE at that point. Actual nadir in net worth occurred six months earlier in March. Since September 2008, NW up 54%. Don't remember being overly worried, but I had other things on my mind. Daughter had major surgery the month before and son was starting to look at colleges.
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Old 08-04-2018, 11:59 AM   #60
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I recall thinking it might be a good idea to have a bigger wad of cash lying around the house...just in case our bank’s ATM no longer functioned and credit cards stopped working, too (or the financial system completely collapsed altogether)! I never had such thoughts of financial Armageddon before. To this day, we keep some extra cash handy “just in case”. September 2008 was definitely a wake-up call.
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