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Jonathan’s thought of the day is, If the stock market’s performance over the next five years was miserable, would you be? I thought it might be fun to kick this one around a bit.
Though I am positioned just fine to survive five or even ten years of misery from the market, I still wouldn’t like it. I guess I’m just too used to seeing things go up. So while the nuts and bolts of our life would be fine, I may still have to tamp down a few stubborn emotions.
I suspect most of us would say we wouldn’t like five years of poor market returns, even if our finances could withstand them. There’s a difference between financial security and emotional comfort. One lesson retirement has taught me is that the market and my happiness don’t have to move in lockstep. If my basic needs are covered and the people I care about are healthy, a miserable market would be an annoyance, not a crisis.
Easier said than done, of course, when we’ve spent decades being conditioned to cheer every green number. But one lesson Jonathan has taught me, stop checking your account balances every day!
We can always live in the camper van.
…down by the river😂
I would like to think not but I really don’t know. During the GFC, the last prolonged downturn, I was entering my peak earning years, had a fairly solid position at my company, and was aggressively invested but with a much smaller portfolio. I didn’t panic then but my I’m sure my concern back then was keeping my current income/job.
Now I have been retired for 18 months with no earned income and a much larger portfolio. I believe our investments are positioned to weather a downturn and still provide the needed income, but I just don’t know how I will feel when that downturn comes.
Enjoying seeing everyone’s thoughts on this. Ken
Interesting timing for this post. Even though I don’t use a financial advisor I went yesterday to receive the Portfolio Risk Analysis that one ran for me.
His software runs 1000 scenarios and gives a percentage chance of having our portfolio run out over the next 20 years.
Best case scenario and average scenario returns going forward it indicated we have a 0% chance of going to zero. Worst case scenario which includes another downturn similar to 2008 puts us at a 1% chance is running our portfolio to zero.