Newly Retired & Survived First Bear Market

[RetiredAt49]

I officially retired 1/1/2022 at the age of 49. I watched our professionally managed brokerage and IRA's drop 26% (including fees) and I survived

I must say that retiring at the peak of a bull and watching your portfolios drop 26% was rough... so much so that I fired our AUM financial advisors (thanks to this website and bogleheads) and we rained in our expenses a fair bit. We are lucky because we have substantial rental properties (they don't generate a ton of income but they are worth a lot of money if/when we needed to sell them) which is why our brokerage and IRA's are in 100% equities.

Curious to hear your perspective/thoughts especially if this was your first bear market... Hopefully nobody pulled out of the market because (fingers crossed) it's headed back up!

 

[jpeter1093]

You're assuming it's over?

 

[RetiredAt49]

You're assuming it's over?

Duly noted... but here's to hoping for a brighter future!

 

[ImThinkin2019]

This is our first bear market since being fully retired. I'm 65 and DW is 64, so we've been through several bears before. And sideways markets.

We were prepared for this. Our income generating bucket is more than sufficient to fund our needs. The equity bucket can go up and down - hopefully up long term it will be up. History would say so. Eventually.

It's nice to be in this group where we all share our experiences!!

 

[FREE866]

I retired January 2017 and since then there has been a nasty correction ( December 2018), a sharp but short bear market ( March 2020) and this latest bear market , yet my portfolio, including ~3-4% withdrawals is still up over 50%!!!
I've become , thankfully, really immune to the volatility.

 

[COcheesehead]

I retired in 2020. There was this thing called a pandemic at the time. LOL. In prep for retirement I built a plan to deal with SORR. I felt almost funny being so conservative. Now two years in, TWO bear markets and having more money than the day I retired, I feel downright smart.

 

[FREE866]

I retired in 2020. There was this thing called a pandemic at the time. LOL. In prep for retirement I built a plan to deal with SORR. I felt almost funny being so conservative. Now two years in, TWO bear markets and having more money than the day I retired, I feel downright smart.

Not sure when exactly you retired in 2020, but you most likely would have more money if you'd stayed in stocks the whole time.

 

[RobbieB]

Yeah, if you believe in equities, you hold on through the whole roller coaster eh?

Equities funded complete inside and outside home improvements with 3 sheds, landscaping and irrigation. New furniture, 2 new cars and domestic first class travel. Not to mention putting DSD through UCLA

And the best for last, Dream Catcher;

Pops told me when I was young, after you have the house and the cash fund, start buying stocks, that's where you'll make the most -

 

[FREE866]

Yeah, if you believe in equities, you hold on through the whole roller coaster eh?

Equities funded complete inside and outside home improvements with 3 sheds, landscaping and irrigation. New furniture, 2 new cars and domestic first class travel. Not to mention putting DSD through UCLA

And the best for last, Dream Catcher;

Pops told me when I was young, after you have the house and the cash fund, start buying stocks, that's where you'll make the most -

Yep. Pops is smart!

 

[COcheesehead]

Not sure when exactly you retired in 2020, but you most likely would have more money if you'd stayed in stocks the whole time.

I have more money than when I retired. Maybe you missed that in my post.

 

[FREE866]

I have more money than when I retired. Maybe you missed that in my post.

I did see it. My response was in response to you claiming you adjusted your portfolio to "prepare for SORR". My point is SORR was inconsequential as a fully invested portfolio saw increases as well.

 

[COcheesehead]

I did see it. My response was in response to you claiming you adjusted your portfolio to "prepare for SORR". My point is SORR was inconsequential as a fully invested portfolio saw increases as well.

Maybe

 

[OldShooter]

Good job. They get easier every time. Our first was 1987.

 

[Major Tom]

I stopped working in 2009, so I suppose this was my first severe downturn. It didn't feel that bad though, as I rarely check my accounts when the market's going down. I figure that if I can't see how little money I have, then I can't get too upset about it. I have much less than many here. At the peak of the market at the very beginning of the year, I had $1.25M. I don't know how much my portfolio dropped, but I checked it yesterday, and it was standing at $1.1M, so everything is fine.

No biggie, unless this was just the first warning salvo in a longer, more pronounced market rout

Congratulations on making it this far, by the way. Retiring when you did and immediately experiencing this market drop, really was a trial by fire!

 

[captain3d]

Congrats on your first relief rally [emoji3]

 

[audreyh1]

Welcome to the club!

Ha, ha, I retired in August 1999.

Then 2000 hit, bear lasted until Oct 2002! Market just kept going down, down, down.

Then 2008 hit! This one was far worse! Technically started in Oct 2007, it did not reach bottom until March 2009. This was the “Great Recession”. Economic recovery took a long time.

The ones since have been shorter .

 

[Time2]

Yeah, if you believe in equities, you hold on through the whole roller coaster eh?

Equities funded complete inside and outside home improvements with 3 sheds, landscaping and irrigation. New furniture, 2 new cars and domestic first class travel. Not to mention putting DSD through UCLA

Yep, retired Oct 2018, after Hurricane Michael did $90k of damage to our home, destroyed our small business and we started four years of dental tuition and housing for DD, at a cost $300k. Over saving for us has been a wonderful thing. Still working on BTD! Although, I have a plan to gift an equal amount to the DS to even things up. But those pesky RMDs have me doing Roth Conversions in a low tax bracket and gifting gets in the way of that.

 

[marko]

I REd at the end of 2005 just in time for 2008. My portfolio has doubled since then despite having withdrawn (over the years) our starting balance.

I'd have perhaps tripled it had I known then what I know now about investing, buying dips and not being overly conservative.

 

[copyright1997reloaded]

Good job. They get easier every time. Our first was 1987.

As was mine.
Graduated in 1978 and bought my first stock that year.

When 1987 hit I lost over a years salary (and 3X my starting salary) in four hours. My emotional response (besides taking $ from the bank to have some cash "just in case" the banks had a "holiday") was to buy, buy, buy.

But my biggest issue is that I tried to buy a bunch of things, it took 3-5 days to get confirmation of whether the buy had occurred or didn't. Things were so crazy that any kind of market order would be insane, so I put bids in on things using limit orders (but had to guess at things because the market reporting mechanisms (i.e. ticker tape) were hopelessly behind. The net result was that since I wasn't sure whether certain buy activities had occurred, I had to consider that capital committed until I eventually heard back.

Some got executed, some didn't. But there were some fantastic buys over that week.

Interestingly, one of my lessons from that experience is that cash and buying power is king - that when opportunities come along it is important to have buying power to take advantage of it.

Another lesson that I learned from then (which you will may disagree with) is that in the short run the market is an emotional, irrational beast. (In the long run it is a weighing machine.)

An interesting documentary of the crash for the youngsters out there:

Another video, a news report:

. Some interesting commentary that would be just as applicable today (and perhaps again wrong).

 

[Pellice]

Retired in 2018 and there was a short decline that fall - but an even sharper recovery. We have to remember the market rise that went up and up until basically the covid outbreak in 2020, which was followed quickly by another rise, and then the outbreak of war in Europe. There seems to be a sort of recovery going on.

Retiring in January, that must have been tough to watch, but stay patient. I was afraid to check my balance until this month, but the worst was over by then.

 

[street]

In a bear attack play dead, don't run, stay put and weather the storm.

You have seen many attacks and know the protocol to survive the bear attack.

 

[copyright1997reloaded]

In a bear attack play dead, don't run, stay put and weather the storm.

You have seen many attacks and know the protocol to survive the bear attack.

Then again, another approach is to whack your friends leg with a stick so that you can outrun him. "When there are two of you, you don't have to outrun the bear, you just need to outrun your companion."

Perhaps the market analog to this is to sell early, before the panic?

 

[RobbieB]

Selling in January has worked well for me so far. I sorta estimate what the new year plan is and fund accordingly in January. This year I took extra out for the boat and you know what happened next. Well, now I'm only down 5.5% YTD, so my (January) timing worked well again.

Sell high!

 

[Souschef]

Welcome to the club!

Ha, ha, I retired in August 1999.

Then 2000 hit, bear lasted until Oct 2002! Market just kept going down, down, down.

Then 2008 hit! This one was far worse! Technically started in Oct 2007, it did not reach bottom until March 2009. This was the “Great Recession”. Economic recovery took a long time.

The ones since have been shorter .

Thank you for clearing up something for me. I retired in January 2009 and rolled my 401K into a mutual fund. It was about $185K, and is now worth $1 mil. Apparently through dumb luck I got in at the bottom, it certainly was not due to market timing.

 

[MarieIG]

I'm newly retired as well, but the bear is not my main concern, inflation is. IMHO, it has raised prices permanently, and even when it slows, the base prices, i.e. of food and other necessitates have been permanently raised.