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  • Lordosis Lordosis 
    Participant
    Status: Physician
    Posts: 1861
    Joined: 02/11/2019
    Earnest refinancing bonus

    I hear it on this forum and on other sites as well.  “You young investors that have not been through hard economic times do not know how you will react”  Or some version of that.

    I was not investing back in 08-09.  I was still in school and taking a ton of loans at that time.  I however am quite capable of looking at history and market trends and can see what has happened in the recent past.  As long as you have a belief that the Market will always go up eventually you will stay in and ride out the tough times.

    Everyone seems to discount this most recent correction last December.  I felt it was a nice test.  I sold a home in December and needed to deal with the equity (about 50K) when my check cleared in early January.  I used it to start my taxable account and plunked it all in VTSAX.  Along with 12K more for the back door roth.  I only wish I got my hands on the money a week earlier.

     

    Those of you who have been around the block.

    Did you bite off more then you could chew in the past?  Do you preach stay conservative until you are a hardened investor? Any words of wisdom?

     

    Other young guys.

    Do you find this annoying as well?  Do you tread carefully or are you invested aggressively?

     

    Fun Aside- Every time I hear the argument I cannot help relate it to GoT when the older characters complain about the Green boys who only know summer.

    “Never let your sense of morals prevent you from doing what is right.”

    #236778 Reply
    Avatar DocNextDoor 
    Participant
    Status: Physician
    Posts: 58
    Joined: 01/27/2018

    Been through a few waves, learned a lot by being in economics class during 1987 Black Monday with Dow down 22%.

    I remember talking to our CFO during the 2001-2002 downtrend that its a great time to buy and he looked at me like I was nuts.

    By 2008 I had future plans in order and held tight.

    To navigate the waves trim the bow, we have a long ride to the other shore.

    #236787 Reply
    Liked by Lordosis
    Avatar octopus85 
    Participant
    Status: Resident
    Posts: 233
    Joined: 08/13/2017

    As a wippersnapper even younger than you, I’m very annoyed when I read comments on this forum like, “Great day to buy!” and “Buffet is holding a cash position!”. I realize *some* of those are tongue-in-cheek, but many aren’t, and I can’t help but shake my head at the mental incongruities necessary to write such statements with a straight face while simultaneously buying low-fee index funds and investing for 30+ years out.

    I think this annoyance bodes well for my ability to ignore such noise in the future.

    #236789 Reply
    Liked by q-school, Zaphod
    Avatar Nysoz 
    Participant
    Status: Physician
    Posts: 88
    Joined: 10/23/2017

    I’m on the younger end of investing for sure. In my mind with what I’ve read, the overall long term trend is up as the US is one of, if not, the strongest economies. If for whatever reason the stock market crashes and stays down for multiple years we’ll have bigger problems out there. With the correction last December I tax loss harvested and changed index funds.

    My plan is to stay aggressive, stay the course. When I have enough to “win the game” or get close to FI/RE, I’ll adjust my asset allocation accordingly.

    With that being said, past performance isn’t an indication of future returns and no one really knows anything. Last I heard yesterday, we were set to lose another 5-600 points on the DOW (in addition to the 750 lost yesterday) in the after hours and all the “analysts” were saying were in for a load more of trouble and hurt. This morning, futures are up 250.

    #236790 Reply
    Liked by Lordosis
    Avatar FIREshrink 
    Participant
    Status: Physician
    Posts: 1006
    Joined: 01/11/2017

    Thinking you know what a 60% market decline feels like just by reading a little about it is like saying you know what sex feels like after having read about it in medical school.

    In theory there is no difference between theory and practice. In practice there is.

    ” He never did marry, or see a B grade movie…”

    Avatar Peds 
    Moderator
    Status: Physician
    Posts: 4445
    Joined: 01/08/2016

    Yes old ppl can be annoying….

    And I still don’t agree with your 100% equity portfolio @lordosis.

    #236792 Reply
    Lordosis Lordosis 
    Participant
    Status: Physician
    Posts: 1861
    Joined: 02/11/2019

    Thinking you know what a 60% market decline feels like just by reading a little about it is like saying you know what sex feels like after having read about it in medical school.

    In theory there is no difference between theory and practice. In practice there is.

    ” He never did marry, or see a B grade movie…”

    Click to expand…

    I get the argument and I guess I am not claiming I know how I would feel but I know what I will do.  I may be pooping my pants but I will not be selling stocks for any reason in the next 20 years.

    Maybe if I need ransom money.

    “Never let your sense of morals prevent you from doing what is right.”

    #236793 Reply
    Lordosis Lordosis 
    Participant
    Status: Physician
    Posts: 1861
    Joined: 02/11/2019
    And I still don’t agree with your 100% equity portfolio @lordosis.

    Click to expand…

    HAHA.  Think that 10% will save you?

    I have done a lot of thinking about when to add my bonds and your points have made quite an influence jut so you know.  I have not pulled a trigger yet.  I just do not think I need the diversification until I hit 1MM.

    Some day we can debate it over a beer and our spouses can call us dorks.

    “Never let your sense of morals prevent you from doing what is right.”

    #236794 Reply
    Liked by hatton1, q-school, Peds
    Avatar SLC OB 
    Participant
    Status: Physician
    Posts: 565
    Joined: 06/23/2018

    I went through 2008-9, had less in the markets, as I was fairly new to the student-loan-free world… and I did not control my $$ at that time (Financial advisor had it)… road it out. However, things have changed, account numbers are higher, I have total control now… so we’ll see. I hope that I don’t do something stupid and I know logically I shouldn’t… and I don’t know what I would do differently, as I am following my plan… but I can’t say for sure I won’t be stupid.

    #236800 Reply
    Liked by Lordosis
    MPMD MPMD 
    Participant
    Status: Physician
    Posts: 2509
    Joined: 05/01/2017

    I don’t find it that annoying.

    What’s annoying to me is how everyone acts like the next big correction (if it comes) will be so easy to identify and deal with because you a) “don’t ever look at my portfolio” or b) “do whatever my IPS says.”

    (A) is just clearly not correct. I’m not going to believe that people who post on a financial internet forum don’t look at their 401k. I look at mine multiple times a week and I suspect many people who would publicly scold me for my naivety do the exact same.

    (B) sucks b/c it’s just some piece of paper you wrote down. It’s not a tablet from Sinai.

    It’s entirely possible that the next real dip will be absolutely terrifying. Not just a few months of slow returns in the market but combined with some domestic or geopolitical event that has everyone truly rattled. I’m not making some partisan statement here. Imagine if a flu pandemic really took off, there was a thermonuclear exchange, or the EU suddenly fell apart with total currency collapse. All of this is unlikely, but it flies in face of the cheery “well just follow your IPS” statements.

    Avatar JBME 
    Participant
    Status: Spouse
    Posts: 531
    Joined: 03/26/2018

    my parents taught me investing at a young age. That’s a good thing. But their idea of diversification is to buy 10-20 different stocks. That’s a bad thing.

    I distinctly remember getting my first job in ’99 in high school and them telling me to put it in the market. We were at market highs and they really wanted me to put my money into Microsoft. I specifically said, “no, we’re due for a recession.” I was strong-armed anyway. It wasn’t much…probably $1000, but that was a lot of money to someone in high school. Then what happens….dot com bust, Microsoft goes from $45/sh to $20 or less. I didn’t sell. But probably by 2007 or so, I noticed the market had had a tremendous run at that point, and still Microsoft wasn’t close to being back to $45/sh. So I sold and took the loss.

    I started full-time post-grad work in 2007 and was investing just in a Roth IRA. The recession happened and I didn’t sell anything. But we’re talking maybe $10k went to $6k. Now I’m much more invested. I feel quite confident I’m not going to do something dumb if the market dips 50%. Instead my reaction is going to be “stocks are on sale!!!” and I’m try to pull as much as I can to buy more. If the market dips another 50%, oh well. I don’t plan to access this money for at least 20 more years.

    So yes, these “old” people saying I don’t know what it’ll be like are irritating. Old people think they know a lot more than they actually know

    #236803 Reply
    Liked by Lordosis
    Zaphod Zaphod 
    Participant
    Status: Physician, Small Business Owner
    Posts: 6186
    Joined: 01/12/2016

    As a wippersnapper even younger than you, I’m very annoyed when I read comments on this forum like, “Great day to buy!” and “Buffet is holding a cash position!”. I realize *some* of those are tongue-in-cheek, but many aren’t, and I can’t help but shake my head at the mental incongruities necessary to write such statements with a straight face while simultaneously buying low-fee index funds and investing for 30+ years out.

    I think this annoyance bodes well for my ability to ignore such noise in the future.

    Click to expand…

    same with comparing house pay down or student loan pay down over some arbitrarily short time frame, drives me bonkers. What does a cherry picked and not your goal horizon time frame have to do with anything?

    In the same vein, no one applauds the mental relief selling at the bottom gives somebody, or the psychic income therein, yet we do it for aggressive mortgage paydowns, etc…Im not against those things in principal, just the horrific reasoning given.

    #236804 Reply
    Avatar tylerjw12 
    Participant
    Status: Spouse
    Posts: 23
    Joined: 05/23/2016

    I was wrapping up my finance degree during 08-09, where my classes basically became ‘current events’ courses. So keenly aware of it but no skin in the game. I’m not worried at all about a downturn the next 15 years and will continue to be aggressively invested. But I do wonder how I will handle a significant decline 25-30+ years out. Guess I need a written investment plan!

    #236806 Reply
    Lordosis Lordosis 
    Participant
    Status: Physician
    Posts: 1861
    Joined: 02/11/2019
    a) “don’t ever look at my portfolio”

    Click to expand…

    Nah I will look.  You have too.  I probably will not watch financial news though.

    do whatever my IPS says

    Click to expand…

    I hope I can do just that!

    It’s entirely possible that the next real dip will be absolutely terrifying. Not just a few months of slow returns in the market but combined with some domestic or geopolitical event that has everyone truly rattled.

    Click to expand…

    I am sure it will be.  At least we have a place to come and cheer each other up and encourage staying the course.

    The Bogleheads seemed to do that for each other during turbulent times.  We will see if this forum has the same gumption.

    “Never let your sense of morals prevent you from doing what is right.”

    #236807 Reply
    TheHappyPhilosopher TheHappyPhilosopher 
    Participant
    Status: Physician
    Posts: 145
    Joined: 08/04/2016

    In 2009 almost all of my investment career had been from 1999-2009. Go look at that chart! After accounting for the cost averaging my investments essentially made no gains in a decade, and all the pundits were talking about complete collapse of the baking sector and overall global economy. This was right around the time I was going through massive burnout. It was, to say the least…distressing. It took all of my will power to not panic and do something stupid like buy gold and ammunition. I basically did nothing, and kept slowly dumping money into the market. I probably held on to too much cash out of fear, and didn’t take advantage of some incredible real estate opportunities, so there was some opportunity cost. But it could have been much, much worse. It is true that one does not know how they will react. I know more than one doc who sold at the bottom and never got back into the market in a meaningful way because of fear. It is best to have an investment plan and try and stick with it. Easier said than dome though. This is actually where a seasoned financial advisor can be helpful. The real value in an advisor is not the investment management or some hack where they save you a few hundred dollars in taxes – it is preventing you from doing something catastrophic like selling your portfolio at the bottom of a bear market.

    #236808 Reply

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