WHEN YOU’VE BEEN saving and investing for a long time, you have a long list of things you wish you could do over. Like hanging on to Apple, instead of selling at $85 a share. Like buying an index fund, instead of that hot mutual fund that quickly turned cold. My wife calls these “what ifs.” We have a rule not to talk about them because they almost always lead to arguments about who was wrong.
Of course, there are also “what ifs” on the positive side. What if we sold everything when the market crashed in 2000-02, 2007-09 and 2020? What if we hadn’t started saving in our 401(k) plans when we got married? What if I hadn’t chosen to leave corporate America to see the country in an RV and later entered seminary?
My most positive “what if” these days is this: What if I hadn’t become a devotee of the bucket approach to retirement allocation in the past five years? Most of our negative financial “what ifs” happened when we forgot when we were going to need our money. Selling stocks or mutual funds just because they go up or down is foolish, especially when retirement is 10 or 20 years away. Kathleen and I were foolish a lot over the years, usually when the market boomed or busted.
Discovering the bucket approach a few years ago has provided much more peace and financial serenity in our lives. We park two years of cash in certificates of deposit and savings accounts. Money for years three through seven goes into bonds and very-low risk mutual funds. Anything we won’t need for at least seven years is in stocks. Last year, when the stock market briefly crashed, I was—for the first time in my life—calm and serene because I knew we’d be okay for at least seven years.
I’m not sure we can ever eliminate all the financial “what ifs” in our lives. But figuring out how to have fewer of them can free us up to do more fun things—the things on our other bucket list.