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We sold our S&P 500 shares from one retirement account to roll them into another, perfectly timing the market peak. I’d love to boast it was our shrewd insight that nailed the sale, but honestly, it wasn’t. We were just moving money from our 401(k) to our Vanguard IRA. Picture a typical morning—coffee in hand, idly glancing over our account balances during our usual monthly check-in.
No brilliance needed—just sheer luck. Some label it dumb luck, though it’s not about being foolish. It’s simply timing’s happy fluke. This isn’t the calculated dance of market timing, picking highs and lows with precision—that’s a different beast. Think of it as providence: an invisible guide turning our ordinary choice into a minor windfall.
Now, we’re waiting for the 401(k) check to arrive. Once it does, we’ll deposit it into our Vanguard account. Will that same providential touch strike again, letting us buy at the market’s temporary low? Time will tell…
Luck or providence? We’ll see.
Never underestimate the value of luck!
I didn’t hit the peak, but I did rebalance out of stocks when I took my RMD late last year. Now I’m waiting to see if I will need to rebalance back in. In the past I just waited the drops out.
My former employer was changing providers when Black Monday hit in the 80s. Many times I’d rather be lucky then good.
Nice. I do think luck and providence do play a part when investing, and in most other worthwhile endeavors.
I’m not into market timing and “buying the dip” may not be as important as steady saving and investing for long periods, e.g. 20 years or more. The impact of short-term bear markets may be exaggerated.
I’m writing because I’m again seeing articles about another “lost decade”. This seems to occur hand in hand with market corrections.
If a protracted bear occurs later in life, while finalizing a retirement portfolio it can negatively impact the value of that portfolio. When combined with withdrawals the effect can be magnified. On the other hand, market downturns earlier in the building period may have less impact.
I have experienced 1974, 2000, 2008, 2020 and 2022.
The lost decade 2000-2010 did impact my portfolio. During that period the S&P returned -1% each year and the NASDAQ -5%. By 2002 my investments had lost most of their value. However, even so I’ve read that the recent 20 year average return 2005-2025 for the S&P 500 was 9.8% including dividends (7.1% adjusted for inflation).
These recent statistics have done wonders for investment portfolios and include the downturns of 2020 and 2022. I’ve definitely benefitted. Now, were this reversed and a 20 year bull period were followed by a 10 years of malaise, the outcome could be very different. There have been papers written about how retirees portfolios fared poorly under such circumstances.
Because of my past experience I’ve always been more concerned about long periods of malaise. I suspect that I’m lucky I didn’t reach retirement age to experience 1973 or 2000.
My older brother had a similar stroke of fortune over the Black Monday (10/19/1987) market crash. He had changed jobs in late August, and decided to roll his 401K into his Fidelity IRA. He had closed his 401k and was holding the check when the crash hit. He was able to invest the money in his IRA at bargain prices. It’s often much bette to be lucky than good.
Sweet! Chris.