All time high

[Meadbh]

I retired Jan 2007 and I'm still a little down from my all time high but the good news is my weight is hitting a fifteen year low !

 

[martyb]

I saw the title of this thread & thought it was related to the California marijuana issue (All Time High) lol

However, although our portfolio's still a little off from where I wish it was, in reality it is at it's all-time high. We're by no means the Rockefellers, but there shouldn't be any dog food in our future!

 

[harley]

I have read that it is better to retire into a thriving, growing market than into a declining market or crash. So in that sense, I think my portfolio is in better shape than I thought. On the other hand, I know that the market goes down and up. That attribute of the market is what kept me from selling in 2008-2009, and it also means that I will just hang on and watch (gleefully, this time) in 2010. Of course it will eventually go down, but meanwhile I am getting a lot of fun out of watching these high numbers, just as I get a lot of fun out of watching a pretty sunset

I’m thinking it’s better to retire right after a crash, when equity values are at a low point and have greater upside than down. Me – I retired a couple of months before the ’00 crash, but then again, my timing has always been like that. It’s amazing how we adapt and persevere.

It's interesting. I retired in 2006, which was near the end of a big jump up. But I feel like I retired into a big crash (for obvious reasons), even though I personally didn't lose much during it. I wonder what the theory is for retiring into a good market that immediately crashes followed by a huge run-up? I mean, what defines what you've retired into? The actions of the immediate future after FIRE? Or do you have to wait 10 years or so and look back to get a decent perspective on what things were like?

 

[W2R]

It's interesting. I retired in 2006, which was near the end of a big jump up. But I feel like I retired into a big crash (for obvious reasons), even though I personally didn't lose much during it. I wonder what the theory is for retiring into a good market that immediately crashes followed by a huge run-up? I mean, what defines what you've retired into? The actions of the immediate future after FIRE? Or do you have to wait 10 years or so and look back to get a decent perspective on what things were like?

I am not sure, but I think the implication is that if you don't have to sell low to fund your living expenses, you are doing fine. Still, I'm not really sure why that would make more difference at the beginning of retirement, than later on.

 

[Birdie Num Nums]

Being at an all-time high--and per FIRECACL "looking good"--why shouldn't I transfer everything I now have into cash equivalents?

 

[73ss454]

Does Firecalc say you are good with all cash? If so, do what you gotta do.

 

[Moemg]

I wonder what the theory is for retiring into a good market that immediately crashes followed by a huge run-up?

If you retire at a peak like I did and do the 4% plus inflation you are in danger of hurting your chances of survival by continuing that number even when your portfolio has dropped say from 1 mil to 750,000. You have a better chance of survival by just doing the 4% of portfolio . This is explained in "The Bogleheads Guide to Retirement Planning " which I highly recommend .

 

[73ss454]

Was it ESRBOB who introduced the 95% rule? You can run it in firecalc and it should help get you through the down times.

 

[W2R]

Was it ESRBOB who introduced the 95% rule? You can run it in firecalc and it should help get you through the down times.

Another method that some of us use to get through down times is to maintain several years' expenses in cash, perhaps 5-10%. If you live on cash and/or cash dividends during a crash, then you don't have to sell anything to fund 100% of your living expenses. Your non-cash investments will remain untouched. Then when the market is doing better, you can sell and replenish your cash percentage.

It seems to me that the trick is surviving through a crash until your portfolio has completely recovered. That's a whole lot easier for those who are able to just live on dividends.

 

[Moemg]

Was it ESRBOB who introduced the 95% rule? You can run it in firecalc and it should help get you through the down times.

I got through the down times by adjusting my 4% to reality .That combined with a pension & a survivor ss helped me maintain sanity . I had several years in my Money Market so I was fine but even if you have the several years set aside but do not lower your initial amount of yearly withdrawal you will damage your portfolio . So I Guess the rule is don't party like it's 2007 in 2009 !

 

[Meadbh]

It's interesting. I retired in 2006, which was near the end of a big jump up. But I feel like I retired into a big crash (for obvious reasons), even though I personally didn't lose much during it. I wonder what the theory is for retiring into a good market that immediately crashes followed by a huge run-up? I mean, what defines what you've retired into? The actions of the immediate future after FIRE? Or do you have to wait 10 years or so and look back to get a decent perspective on what things were like?

http://www.ifid.ca/pdf_newsletters/PFA_2006FEB_sequencing.pdf

 

[harley]

http://www.ifid.ca/pdf_newsletters/PFA_2006FEB_sequencing.pdf

Thanks. An excellent, if somewhat disturbing, paper. I guess using a Monte Carlo simulation is just an extension of this concept. I think the best thing to do is sell before the price drops, and buy back in when it hits bottom. I'll have to work on that.

 

[Meadbh]

I did a quick estimate today. Assets are up $800K since March 2009. NW is up $650K (liabilities have increased as I have taken on some low interest debt). Estimated additions to the portfolio over that time are $150K. Strategy during meltdown: take big breath, relax, buy some gold, do nothing. Strategy going forward: continue to risk proof the portfolio using asset allocation and diversification. It's all good.

 

[retire@40]

How do people know what their all time high was - and how often do folks update their portfolio value? I only know my past YE numbers.

I have been keeping a monthly net worth listing showing each of my assets, the YTD ROI, and related financial ratios.

Yes, I am at an all-time high as well, but the funny thing is, I don't believe it's real yet.

 

[Birdie Num Nums]

You're going to throw out the apple?

1) Actually, I took that apple off the TV and ate it, thank you very much.
2) I am a "he," not a "she." (Correcting a poster's impression.)
3) By saying that I'm considering letting my "freak flag fly" (courtesy of David Crosby's "Almost Cut My Hair"--meaning shaking your head and loosening yourself a bit), I meant that I may wanna loosen my frugalness girdle a bit, what with my "new all time high," and do some spending that I wouldn't otherwise have done.

Hey! Getting some Eggs Benedict at Glo's looks good!

 

[NW-Bound]

I did a quick estimate today. Assets are up $800K since March 2009. NW is up $650K (liabilities have increased as I have taken on some low interest debt).

Now that you mentioned March 09, I looked back to see that my lowest was on March 09, 2009 (I kept a diary). It coincided with the day the market hit bottom. On that day, the Dow dropped to 6547, the Nasdaq to 1269, and the SP500 to 677.

Since that day, my portfolio is up a bit more than your NW number above, not counting RE whose values are so illiquid I do not even bother to think about. With the S&P at 1226 as of Fri Nov 5, 2010, had one gone "all in", he would have made 81% gain! Of course most of us have gained less than that, except for younger people who are still accumulating.

It is truly an interesting time that we have been through. The $ amount above is what I can live on for 10 years, and a bit longer if I cut costs further. Think about that, it does not seem real, does it? So, it is natural that I have been mesmerized by the market movement and have to watch it frequently, even if I do not trade daily.

Well, the market giveth and the market taketh. I will still keep the little motor home just in case I need to head into the mountains of New Mexico...

P.S. Just found something for people to brag about. If you are like me, my previous high was reached on Oct 31, 2007. Again it coincided with the market high of 13930 on the Dow, Nasdaq of 2859, and S&P of 1549. The current S&P of 1226 is still only 79% of that all-time high. So, people who have reclaimed their old high while not putting in fresh money or even being 100% invested can legitimately claim to have beaten the market. Of course, the market abhors hubris, so it may be time for people to "rebalance".

 

[plex]

Hit "all time high" sometime during summer. Not exactly hard to hit an all-time high since i started investing in early 2007, and my stock returns were rarely significantly net positive until summer 2010. I also made two years worth of contributions in late March 2009, and switched my portfolio to stock as much as I could. Since this was only a 5 figure portfolio it wasn't that big of a difference, but it was fun. I also had 20% of my money tied up in a 6% CD, but I was happy with that return.

 

[obgyn65]

Congrats Alan

Same here. Since April '09 we are up 44%.

 

[obgyn65]

I update my xls file once a month and save it under a different name during the month of January of every year (i.e. nw2008.xls, nw2009.xls, etc).

How do people know what their all time high was - and how often do folks update their portfolio value? I only know my past YE numbers.

 

[dex]

The next down legs - down to mid Dec, bounce and then decline into June?

 

[dex]

Past info.

For those Asset Allocation (market timers) it might be an opportune time to reallocate some assets.

 

[73ss454]

Dex, I guess you actually follow this stuff. I think many of us have learned our lesson about market timing.

 

[Birdie Num Nums]

Does Firecalc say you are good with all cash? If so, do what you gotta do.

One of my Firecalc "assumptions" is that I'm gonna live a long, long time (perhaps to 95 or more, if I am very, very fortunate). But the odds are that I won't reach that age. And thus I won't need my nest egg to last for that "long, long time." Plus, I love the idea of living more in my early years of ER (spending more $ to enjoy life more--such as eating out more often for meals that are already-made, tastier, and more varied than I can spend the time in my kitchen making, entertainment, travel, and what-have-you) than during my later years--when I may not have the health, physical mobility, or soundness of mind I now have.

 

[NW-Bound]

Yep, all that jubilation finally has its effect. A delayed effect, yes, but it has finally come.

I should have sold ALL when W2R started dancin'. Is this not the 3rd time now? What did I do but holding on to my stocks, hoping that it will be different this time?

Just sold a high-beta stock to "rebalance" another 1% to cash. Oh, when will I ever learn? Where have all my cap gains gone? High-speed traders picked them all.

YouTube - Marlene Dietrich - Where Have All The Flowers Gone?

 

[Moemg]

Yep, all that jubilation finally has its effect. A delayed effect, yes, but it has finally come.

You are a slow learner . I hear the jubilation and see the dancing smileys and I skim off some profits or rebalance earlier than planned .