I agree with both of you.

But history is always a 100% clear. The future can be lot less so. Basing the future on historical data is helpful.

But again we are at the window in terms of length of time left.

So doing what is best is left to the individual which usually works out good if one takes the time and puts the work in.

quote:

Originally posted by old rugged cross:

quote:

Originally posted by Perception:
This is a great time to be in the market if you're not trying to retire right now. The more the market drops, the more shares you are purchasing with the same amount of money. If you're 15+ years out, this is fantastic news for you.

I always chuckle at this line. Because it sounds great. And I understand it. But what if we start a downward trend and
it last a dozen years. Do you keep telling your self this for the next 12 years?

When has that ever happened?

I'd be considered one of the contrarians to Rouges illustration above. I'm invested aggressively as if I'm 30 years old (clearly, I'm not) and not on a glide path to a conservative investment landing for retirement. Having said that, I'm somewhat diversified in my aggressiveness.

As a side note, I think I-Bond's are worth consideration for parking cash.

Five years from now I expect to become more conservative.

quote:

Originally posted by dave7378:

quote:

Originally posted by old rugged cross:

quote:

Originally posted by Perception:
This is a great time to be in the market if you're not trying to retire right now. The more the market drops, the more shares you are purchasing with the same amount of money. If you're 15+ years out, this is fantastic news for you.

I always chuckle at this line. Because it sounds great. And I understand it. But what if we start a downward trend and
it last a dozen years. Do you keep telling your self this for the next 12 years?

When has that ever happened?

October, 1929?

quote:

Originally posted by SIGnified:
October, 1929?

That downward trend lasted about 2.75 years. The stock market bottomed out in June 1932.

quote:

Originally posted by RogueJSK:

quote:

Originally posted by SIGnified:
October, 1929?

That downward trend lasted about 2.5 years. The stock market bottomed out in mid-1932.

Thanks; didn’t go look it up, hence “?” Could you make 7-10% yoy?

To the OP, you are young enough to still be thinking aggressive, especially during downturns. That is a good time to find some undervalued buys. When I first started investing in the late 90's I was terrified of loss. Seriously kept me up at night. Invest what you can, let it ride. I have been through a few ups and downs. The only people who lost money were the ones that got scared and sold. There were a bunch of time I wanted to get out but left it alone and I am thankful that I did. A lot of it depends on how close to retirement you are. If you are close then you have to start to think conservative, but where you are right now, invest and dig in.

quote:

Originally posted by mrvmax:

quote:

Originally posted by 1s1k:
I remember listening to a Dave Ramsey show and this woman was calling in with the same worries. Her and her husband had never invested and they had done a great job by saving 2 million dollars. When asked why they didn’t invest it was always the same answer thinking the sky is falling next week.

You should have heard her voice when Dave told her how much they would have had if they would have been investing that money the last 30 years instead of buying CD’s and money markets.

Remember for all the people that tell you the sky is falling there are just as many saying the Dow will be at 45,000 in 5 years. Inflation is terrible for the consumer but a lot of companies are making record profits because their products are selling at those higher “inflated” prices.

Yes, and I know a guy that lost most of his 401 in 2008. I believe he has since passed but he was too old to recover his losses.

That’s why you go more and more conservative as you age.

quote:

Originally posted by RogueJSK:

quote:

Originally posted by Rey HRH:
It's a minor setback if you're still young and working and the market tanks; it's another thing if you're old, don't care to or unable to go back to work and the market tanks and you still have a few years left to live.

Which is why many financial advisors recommend the concept of a "glide path", where your retirement investments become more conservative the closer you get to retirement.

This means less exposure to the volatility of the stock market when you're running out of time to bounce back from a crash/correction.

An investment allocation that works for a 30 year old won't look the same as what's best for a 55 year old.

For example, this example of a glide path starts out with 90% stocks and 10% bonds when you still have decades to retirement, and then gradually transitions over until it reaches only 30% stocks during retirement:

I'm aware of those "glide paths," but I also think they're overly conservative. It depends on how much you're working with and your intentions for the funds for when you die. It's just a take off from the idea that mixing stocks and bonds and whatever else that aren't correlated reduces volatility while still providing decent returns.

If you have some amount but still need growth to sustain financing your later years, you're going to need more percentage in stocks. If you have a lot like Ross Perot, no one's going to blame you for putting 100% of it in government treasuries like he did.

The good news, if I remember correctly, is that statistically, the stock market has recovered fully 5 years or less. So that's another threshold to consider if you want to continuously fund your retirement is how to strategically invest or make safe 5 years' worth of expenses.

I think my original point in my initial post is that the maxim of staying in the market because it eventually goes higher along with the maxim that most increases come in short spurts and missing out on those spurts by being out of the market is more adverse in your portfolio than just riding out the bumps is offset by the piece of mind of strategically making the decision of staying out of the market with a portion of your portfolio for a given period when statistically no significant benefit is gained by staying in.

You should definitely try to time the market and sell your investments and buy a bunch of gold. Or ammo. Or lotto tickets.

quote:

Originally posted by old rugged cross:

quote:

ETA: mrvmax, I just saw your comment. The guy you know who "lost most of his 401 in 2008" is exactly who I'm talking about. If he had done nothing he would have been fine.

Except he died. So there is that aspect.

"In the long run, we are all dead."

It may have been one the few times Keynes was right, but there is no denying it.

My point was not that he died, But died before he could recover in a positive market after the melt down of 2008.

But you knew that jhe

Universal truth # 237:

The Stock Market will crash.

And rebound.

And correct.

And rebound.

Or not.

Some people can afford to be cavalier about investment risk, others can't afford a flat tire between paychecks.

Your risk tolerance dictates your strategy.

quote:

Originally posted by old rugged cross:
My point was not that he died, But died before he could recover in a positive market after the melt down of 2008.

But you knew that jhe

It was just a little joke and JMK's expense.

My investments in Pb and brass have appreciated significantly; some of it by an order of magnitude in less than 10 yrs. Small Scrooge Mcduck vault of highly fungible assets.

quote:

Originally posted by SIGnified:
My investments in Pb and brass have appreciated significantly; some of it by an order of magnitude in less than 10 yrs. Small Scrooge Mcduck vault of highly fungible assets.

Yes, but would you be willing to sell it?

quote:

Originally posted by PASig:
I am

It's a shitty feeling too

What can I do to protect my 401k at this point? I've got about 15-18 years left to work before retirement but by then the age may be jacked up to 85

If you've got that many years left, you stay in and let it recover. A lot more people have lost their ass or missed huge gains trying to game the market.

Another bad day (or buying opportunity for others). I don't track the S&P500 but do follow the Vanguard 500 index admiral share (Vfiax).

quote:

Originally posted by old rugged cross:
Another bad day (or buying opportunity for others). I don't track the S&P500 but do follow the Vanguard 500 index admiral share (Vfiax).

If Russia invades Ukraine the decline will continue.