Sell Off emotional managment

[Doolish1]

After last Friday's sell-off, I lost maybe 40K in a day. I understand this is like 2-3% of a portfolio and a blip not a trend, etc. I know the market trends should be measured closer to decades not hours, etc.

Just for advice:

But if you are retired, how do you, personally, emotionally reconcile the concept that you may have lost a year of spending (for me at least) in a day?

 

[freedomatlast]

Look at how much your portfolio increased in the last 6 months or a year, and if the amount of the decrease in one day ruined your day, perhaps you have too much in equities.

 

[Luvtoride]

I just “rationalize” that I had taken funds out of that account to replenish cash needs a couple of day before…so the withdrawal was of a smaller portion of my portfolio than it would have been on Friday
Other than that, one or a couple of days of decline doesn’t phase me.

 

[chemEguy]

I was relieved to see it if I’m being honest. The run up we had wasn’t sustainable and had to reverse at some point.

We’ve seen a 900K increase in 12 months. During Covid’s early weeks, it was the opposite in about a month.

It’s what I expect with the portfolio mix we have. Not the first, won’t be the last. It’s the nature of the market. Do nothing and stick with the strategy. That’s the answer. It’s not pleasant, but there you go.

 

[CyclingInvestor]

67, retired 19 years. I see investing as simple math, no emotions involved, which for me means staying 100% in stocks. Since retiring I have watched 3 40%+pullbacks (including 52% in 4 weeks in March 2020) with no stress at all.

 

[EastWest Gal]

The longer I'm retired, the less days like Friday bother me. I retired in the same year as OP. One of tricks I use is to Google "DJIA graph over time" or "S&P 500 graph over time" and set it to the max over time. You will see that days like Friday and times like 2002, 2008, and 2020 are just blips. The remarkable thing about the 1990s and 2010-2019 is that there weren't many such dips.

Also, since the beginning of the year, my portfolio has gained more than twice the value of my previous annual salary.

 

[COcheesehead]

I have a financial dashboard I created right after I retired. It’s a piece of art if I might say. With just a couple inputs daily it shows me all kinds of data. It stress tests the portfolio at different drawdown levels, shows me historic levels of net worth, portfolio etc and it shows me number of years of expenses on hand. So when a day like Friday rolls around it puts it into context quickly. Friday was nothing. In fact we’d have to have the biggest correction ever before I’d even take notice. 63 and retired for 6 years.

 

[TheWizard]

Especially if you have a high stock percentage AA, it's important not to "anchor" too heavily on the most recent All Time High portfolio value.
Things are going to fluctuate.
Most of us who have been investing for a few decades are used to this...

 

[sparky08]

I keep a couple years of expenses in low risk investments.

On days like that I say “I’m glad I didn’t need that money for 3 years!”

 

[floss187]

I rationalize it as, oh, i have the same amount of money today as i did in april, and i wasn't scared then, why should i be scared now?

 

[The Cosmic Avenger]

Look at how much your portfolio increased in the last 6 months or a year, and if the amount of the decrease in one day ruined your day, perhaps you have too much in equities.

This. If you can, get a 1 year or even 2 year graph of your total portfolio, and look at how close to the top you really are. Then look at the last dip (for us, Feb 26-March 30), and look how long it took to get back to the previous high (for us, April 17, or 2.5 weeks). I also consider how much we could cut from our spending if there was an extended (6+ months) downturn, and remind myself that, even without cutting spending, we probably would make it anyway, although it might be uncomfortably close.

 

[Aerides]

I dont look every day, not even every week. I would not go out and spend more because I went up 40k, nor less if I were down many times that.

 

[Dtail]

If you have a retirement plan and truly believe in it, then a 40k loss should not bother you.
If you had a 40k daily gain, what would your thoughts be?
The market was up yesterday and appears it will be up today again.
Just relax and trust in the process.

 

[EQMAN]

I record my total investment balance each week and rank that week. As an example last week I was down more than I ever made in a year when working, but the prior several weeks I was hitting new highs. As a result last week ranked 4th highest balance out of the past 500+ weeks. So no big deal.

 

[RetiredHappy]

I just accept it as part of an elevator, which usually goes up to higher floors before coming back down a few floors. Mathemathically, even if we lose 30% of our portfolio, it does not affect our lifestyle. In our case, when we look at the big picture, our portfolio went up about 13% YTD and gave back about 3% over a couple of days. We were still up 10% after Friday's down day. I will take that every time.

 

[TripleLindy]

Did I lose money last week? I have no idea. I don’t pay attention to the micro gyrations of the markets. The only time I really felt panic was during the pandemic, when the markets fell by ~30%. I had only retired a couple of years before that. But even that turned out to be short-lived.

 

[target2019]

I don't track winning or losing days. I watch some tickers that are significant to our investments.

 

[jazz4cash]

Something happened on Friday in the markets? I better go look again.

 

[jazz4cash]

Something happened on Friday in the markets? I better go look again.

Ok, I see it now. The main portfolio dropped all the way down to where it was 2 weeks ago. This feels like a bubble.

 

[GrayHare]

If an account's value remains higher than the amount I put in, I'm content. Daily ups and downs are just small blips in the long term.

 

[TheWizard]

If an account's value remains higher than the amount I put in, I'm content. Daily ups and downs are just small blips in the long term.

That's being generous.
Some of the amounts I "put in" two or three decades ago have increased in value considerably.
I think my "content" level is at a bit higher level than yours...

 

[Toocold]

I do two things:
- I update every quarter.
- I only look at figures when it's at all time highs.

 

[chemEguy]

I realize some of the replies here are a bit flip. If you’ve seen it before, you know how it goes.

But as we know, there are always newer investors that have recently gotten on the same train we have been on for awhile. Depending on when they boarded, the first big drop and portfolio hit comes at different times. But it’s always a shock to the system.

It doesn’t become less sickening, but you learn that it’s part of the ride.

 

[audreyh1]

Fortunately by the time I retired I was inured to big market drops that dwarfed my annual salary. But I also set up a system that included 1-2 years of cash to cover living expenses upon retirement and it gets replenished annually. At retirement we had even set aside extra for a travel budget so that we could do a lot of travel immediately regardless of market conditions. As a result we easily ignore short-term market volatility and I don’t pay attention to drops from recent highs, but rather look at YTD and YOY performance. I’ve been convinced the equity markets are way overvalued for years now, but still willing to ride the rollercoaster.

 

[bonvoyage]

I have a tracking spreadsheet that I update every Saturday morning. In 2026, the maximum decline in one week was $314k and the maximum increase was $237k. If you have been doing this long enough, (35 years my case) you eventually get used to wild swings.