I pulled out... How do I get back in?

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Domadosolo
Posts: 28
Joined: Wed Oct 02, 2019 10:53 am

I pulled out... How do I get back in?

Post by Domadosolo » Wed Oct 02, 2019 11:17 am

I have all my IRA in MM.
Suggestions for getting back in the market? ETFs?

Why did i pull out? I wanted to hedge some market downside, anticipating a 5% drop with the global uncertainty, knowing i could miss a 5% upside
I didn't pull out of the taxable assets due to tax issues,
Silly me, pulled out trying to time the market, anticipating a 5% drop...
But, Market is down so I might start getting in.

What do you suggest?

-58y, retired, sufficient cash flow from taxable assets for the next 10 years.

eer_no_evil
Posts: 30
Joined: Thu Jun 29, 2017 1:50 pm

Re: I pulled out... How do I get back in?

Post by eer_no_evil » Wed Oct 02, 2019 11:29 am

jump back in and forget your password and the tinkering....

dacalo
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Re: I pulled out... How do I get back in?

Post by dacalo » Wed Oct 02, 2019 11:33 am

Get back in with the same vindication as when you pulled out.

bloom2708
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Re: I pulled out... How do I get back in?

Post by bloom2708 » Wed Oct 02, 2019 11:33 am

Get back in with 40% stocks.

You have to be able to sleep at night. Keep some short/intermediate term bond index funds on the other side.

No easy answer. 2 "down" days in a row. Is that a trend or just 2 down days in a row? No idea.
“People don’t want advice, they want confirmation.” Unknown

H-Town
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Re: I pulled out... How do I get back in?

Post by H-Town » Wed Oct 02, 2019 11:36 am

Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.

FrugalConservative
Posts: 118
Joined: Thu Aug 17, 2017 9:44 am

Re: I pulled out... How do I get back in?

Post by FrugalConservative » Wed Oct 02, 2019 11:38 am

H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
This is horrible advice during the current bull market.

AHTFY
Posts: 64
Joined: Mon Jul 23, 2018 2:33 pm

Re: I pulled out... How do I get back in?

Post by AHTFY » Wed Oct 02, 2019 11:40 am

1) Admit you don't know where the stock market is going.
2) Decide what asset allocation you want.
3) Invest.

l1am
Posts: 214
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Re: I pulled out... How do I get back in?

Post by l1am » Wed Oct 02, 2019 11:47 am

I suggest buying back in now with an AA you're actually comfortable with.

H-Town
Posts: 2019
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Re: I pulled out... How do I get back in?

Post by H-Town » Wed Oct 02, 2019 11:48 am

FrugalConservative wrote:
Wed Oct 02, 2019 11:38 am
H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
This is horrible advice during the current bull market.
Yours could be worse. You implied that this is still a bull market. Best of lucks. :beer

Buying the dips gave me a decent profit during Dec 2018. Can't wait for the next one.

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ruralavalon
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Location: Illinois

Re: I pulled out... How do I get back in?

Post by ruralavalon » Wed Oct 02, 2019 11:52 am

Domadosolo wrote:
Wed Oct 02, 2019 11:17 am
I have all my IRA in MM.
Suggestions for getting back in the market? ETFs?

Why did i pull out? I wanted to hedge some market downside, anticipating a 5% drop with the global uncertainty, knowing i could miss a 5% upside
I didn't pull out of the taxable assets due to tax issues,
Silly me, pulled out trying to time the market, anticipating a 5% drop...
But, Market is down so I might start getting in.

What do you suggest?

-58y, retired, sufficient cash flow from taxable assets for the next 10 years.
Jump back in with a reasonable asset allocation, something in the range of 60/40 to 40/60. Use only broadly diversified index finds or ETFs, such as total market index funds.

Stop trying to guess the direction or magnitude of the next stock market moves.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

CurlyDave
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Re: I pulled out... How do I get back in?

Post by CurlyDave » Wed Oct 02, 2019 11:52 am

Domadosolo wrote:
Wed Oct 02, 2019 11:17 am

...What do you suggest?
Follow the advice of that ancient financial advisor, William Shakespeare. "...Screw your courage to the sticking place..."

Remember what your IPS says your AA should be, put on your big boy pants, and move the money. A lot of brokerage houses have announced zero commissions starting today or tomorrow, making this a good time to just do it.

retiredjg
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Re: I pulled out... How do I get back in?

Post by retiredjg » Wed Oct 02, 2019 11:56 am

Your stock to bond ratio is a bit like a spouse - you want one you can live with in both the good times and the bad times. You have to do it that way because market timing simply does not work.

Figure out what you can live with in the bad times and invest that way. Dump it all in as soon as you figure it out.

Momus
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Re: I pulled out... How do I get back in?

Post by Momus » Wed Oct 02, 2019 12:40 pm


KlangFool
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Re: I pulled out... How do I get back in?

Post by KlangFool » Wed Oct 02, 2019 12:47 pm

OP,

No ETF. Pick a target retirement fund.

KlangFool

SGM
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Re: I pulled out... How do I get back in?

Post by SGM » Wed Oct 02, 2019 12:55 pm

As the expression heard so often in Saskatchewan, "put on your skates now get on the ice". :wink:
Pick an AA you are comfortable with then stay the course.

mptfan
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Re: I pulled out... How do I get back in?

Post by mptfan » Wed Oct 02, 2019 1:32 pm

dacalo wrote:
Wed Oct 02, 2019 11:33 am
Get back in with the same vindication as when you pulled out.
Words to live by. :wink:

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HomerJ
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Re: I pulled out... How do I get back in?

Post by HomerJ » Wed Oct 02, 2019 1:34 pm

H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
A 50% run-up would be missed, and it might happen before the next 20% or more drop.

In fact, missing that 50% run-up might cause the OP to run out of money in retirement.

OP, pick an Asset Allocation that you can stick with... Since you're retired, go conservative... maybe 30/70 stocks/bonds. And just stick with it. But jumping in 100% one way or 100% the other way is the absolute worst way to invest.
The J stands for Jay

H-Town
Posts: 2019
Joined: Sun Feb 26, 2017 2:08 pm

Re: I pulled out... How do I get back in?

Post by H-Town » Wed Oct 02, 2019 1:55 pm

HomerJ wrote:
Wed Oct 02, 2019 1:34 pm
H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
A 50% run-up would be missed, and it might happen before the next 20% or more drop.

In fact, missing that 50% run-up might cause the OP to run out of money in retirement.

OP, pick an Asset Allocation that you can stick with... Since you're retired, go conservative... maybe 30/70 stocks/bonds. And just stick with it. But jumping in 100% one way or 100% the other way is the absolute worst way to invest.
OP is close to retirement and if OP saved enough to retire, why would he or she need to take more risk in this environment? If you won the game, why keep playing?

knowledge
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Re: I pulled out... How do I get back in?

Post by knowledge » Wed Oct 02, 2019 1:57 pm

I'm not speaking from personal experience (I don't think you'll find too many on this forum that would, going to all cash is kinda of the antithesis of bogleheads), but I'll try to frame it in a way that I'd tackle the problem.

Imagine it was "Day 1" of this money. Put a strategy together, put together a plan, and then implement it.

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SevenBridgesRoad
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Re: I pulled out... How do I get back in?

Post by SevenBridgesRoad » Wed Oct 02, 2019 2:02 pm

Domadosolo wrote:
Wed Oct 02, 2019 11:17 am
I have all my IRA in MM.
Suggestions for getting back in the market? ETFs?

Why did i pull out? I wanted to hedge some market downside, anticipating a 5% drop with the global uncertainty, knowing i could miss a 5% upside
I didn't pull out of the taxable assets due to tax issues,
Silly me, pulled out trying to time the market, anticipating a 5% drop...
But, Market is down so I might start getting in.

What do you suggest?

-58y, retired, sufficient cash flow from taxable assets for the next 10 years.
You ask about ETFs. Not sure how ETFs help you. The problem is you are a market timer and BHs agree market timing is unwise. Even today though, you are a market timer still, since you say, "But, Market is down so I might start getting in." You timed getting out and now you are timing getting in. You asked us, "What do you suggest?" Admit you are a market timer and decide you don't want to be. Then protect yourself from your past behavior (which will likely pop up again). Write down your plan. Then limit temptation with a Target Date Fund with AA that doesn't keep you awake at night or even make you want to peek. No financial news programs, etc. Consider turning off non-financial news as well. Get busy with something else, especially since you don't need this money for about ten years as you say.
Retired 2018 age 61 | "Not using an alarm is one of the great glories of my life." Robert Greene

deikel
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Re: I pulled out... How do I get back in?

Post by deikel » Wed Oct 02, 2019 2:27 pm

HomerJ wrote:
Wed Oct 02, 2019 1:37 pm


Bad news always gets more clicks/views/ratings than good news.

This is actually something I wonder...is there a news channel out there that intentionally shows the good news ? I know Adriana had such a plan, but have not heard from that in a while....but if such thing existed, I would watch it - more then some others that I can not name here...I find positive news much more interesting actually...has it ever been tried ? Or was this a self fulfilling prophecy and hence we end up with the crap new we have these days.

But for the OP, I would be most curious what the asset allocation was that the OP pulled out of....because that would tell us a lot about OPs risk tolerance. Clearly OP was concerned about a 5% dip - so with that little risk tolerance, maybe actually staying out and investing in CDs or treasuries or real estate might not be such a bad idea.

I don't think the generic 50/50 will do here
Everything you read in this post is my personal opinion. If you disagree with this disclaimer, please un-read the text immediately and destroy any copy or remembrance of it.

frcabot
Posts: 211
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Re: I pulled out... How do I get back in?

Post by frcabot » Wed Oct 02, 2019 2:31 pm

H-Town wrote:
Wed Oct 02, 2019 11:48 am
FrugalConservative wrote:
Wed Oct 02, 2019 11:38 am
H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
This is horrible advice during the current bull market.
Yours could be worse. You implied that this is still a bull market. Best of lucks. :beer

Buying the dips gave me a decent profit during Dec 2018. Can't wait for the next one.
Buying the dip is completely different advice than “stay uninvested.”
Last edited by frcabot on Wed Oct 02, 2019 2:41 pm, edited 1 time in total.

MotoTrojan
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Re: I pulled out... How do I get back in?

Post by MotoTrojan » Wed Oct 02, 2019 2:36 pm

If the market popped 5% over a week, or even a day, would you really be screaming to buy back in? Next thing you know, you missed a 25% pop...

Just buy in, tell yourself to stop market timing, and take whatever loss you got.

KingRiggs
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Location: Indiana

Re: I pulled out... How do I get back in?

Post by KingRiggs » Wed Oct 02, 2019 2:40 pm

Market is rebounding right now...too late! :beer
Advice = noun | Advise = verb | | Roth, not ROTH

H-Town
Posts: 2019
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Re: I pulled out... How do I get back in?

Post by H-Town » Wed Oct 02, 2019 3:00 pm

frcabot wrote:
Wed Oct 02, 2019 2:31 pm
H-Town wrote:
Wed Oct 02, 2019 11:48 am
FrugalConservative wrote:
Wed Oct 02, 2019 11:38 am
H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
This is horrible advice during the current bull market.
Yours could be worse. You implied that this is still a bull market. Best of lucks. :beer

Buying the dips gave me a decent profit during Dec 2018. Can't wait for the next one.
Buying the dip is completely different advice than “stay uninvested.”
Yeah, but take a look at OP's situation. OP already has cash flow to live on for the next 10 years. OP is retired. If OP can afford to buy the dips, why not?

I wouldn't recommend anyone to jump in/jump out of stock and time the market. But OP already jumped out. What done is done. If I have money sitting in MM right now, I'm in no rush to buy stocks. I'll buy during RBDs like today.

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willthrill81
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Re: I pulled out... How do I get back in?

Post by willthrill81 » Wed Oct 02, 2019 3:04 pm

Domadosolo wrote:
Wed Oct 02, 2019 11:17 am
I have all my IRA in MM.
Suggestions for getting back in the market? ETFs?

Why did i pull out? I wanted to hedge some market downside, anticipating a 5% drop with the global uncertainty, knowing i could miss a 5% upside
I didn't pull out of the taxable assets due to tax issues,
Silly me, pulled out trying to time the market, anticipating a 5% drop...
But, Market is down so I might start getting in.

What do you suggest?

-58y, retired, sufficient cash flow from taxable assets for the next 10 years.
If you had not pulled out, would you do so now? I suspect not.

As others have noted, it sounds like you need to (1) adopt a conservative AA (HomerJ's recommendation of 30/70 is a good one) and (2) turn off the news.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

KingRiggs
Posts: 240
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Location: Indiana

Re: I pulled out... How do I get back in?

Post by KingRiggs » Wed Oct 02, 2019 3:04 pm

KingRiggs wrote:
Wed Oct 02, 2019 2:40 pm
Market is rebounding right now...too late! :beer
Oh, wait...it's back down now...sell! :oops:
Advice = noun | Advise = verb | | Roth, not ROTH

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HomerJ
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Re: I pulled out... How do I get back in?

Post by HomerJ » Wed Oct 02, 2019 3:06 pm

H-Town wrote:
Wed Oct 02, 2019 1:55 pm
HomerJ wrote:
Wed Oct 02, 2019 1:34 pm
H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
A 50% run-up would be missed, and it might happen before the next 20% or more drop.

In fact, missing that 50% run-up might cause the OP to run out of money in retirement.

OP, pick an Asset Allocation that you can stick with... Since you're retired, go conservative... maybe 30/70 stocks/bonds. And just stick with it. But jumping in 100% one way or 100% the other way is the absolute worst way to invest.
OP is close to retirement and if OP saved enough to retire, why would he or she need to take more risk in this environment? If you won the game, why keep playing?
Because inflation is a risk, and one usually needs SOME growth to make a nest egg last 30-40 years.

I don't think 4% worked very well in the past with a 100% money-market portfolio.
The J stands for Jay

WhiteMaxima
Posts: 1977
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Re: I pulled out... How do I get back in?

Post by WhiteMaxima » Wed Oct 02, 2019 3:07 pm

willthrill81 wrote:
Wed Oct 02, 2019 3:04 pm
Domadosolo wrote:
Wed Oct 02, 2019 11:17 am
I have all my IRA in MM.
Suggestions for getting back in the market? ETFs?

Why did i pull out? I wanted to hedge some market downside, anticipating a 5% drop with the global uncertainty, knowing i could miss a 5% upside
I didn't pull out of the taxable assets due to tax issues,
Silly me, pulled out trying to time the market, anticipating a 5% drop...
But, Market is down so I might start getting in.

What do you suggest?

-58y, retired, sufficient cash flow from taxable assets for the next 10 years.
If you had not pulled out, would you do so now? I suspect not.

As others have noted, it sounds like you need to (1) adopt a conservative AA (HomerJ's recommendation of 30/70 is a good one) and (2) turn off the news.
(1) AA 60/40 (2) Re-balance every quarter (3) Enjoy your life.

H-Town
Posts: 2019
Joined: Sun Feb 26, 2017 2:08 pm

Re: I pulled out... How do I get back in?

Post by H-Town » Wed Oct 02, 2019 3:11 pm

HomerJ wrote:
Wed Oct 02, 2019 3:06 pm
H-Town wrote:
Wed Oct 02, 2019 1:55 pm
HomerJ wrote:
Wed Oct 02, 2019 1:34 pm
H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
A 50% run-up would be missed, and it might happen before the next 20% or more drop.

In fact, missing that 50% run-up might cause the OP to run out of money in retirement.

OP, pick an Asset Allocation that you can stick with... Since you're retired, go conservative... maybe 30/70 stocks/bonds. And just stick with it. But jumping in 100% one way or 100% the other way is the absolute worst way to invest.
OP is close to retirement and if OP saved enough to retire, why would he or she need to take more risk in this environment? If you won the game, why keep playing?
Because inflation is a risk, and one usually needs SOME growth to make a nest egg last 30-40 years.

I don't think 4% worked very well in the past with a 100% money-market portfolio.
It's better than a scenario when you have 50+% drop during your first few years of retirement. I do know some stories about people who retired during 2007, 2008. They had to go back to work, and it's 2019 (12 years after their supposedly retirement).

OP can wait and buy the dips. He/she won't stay 100% MM forever.

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LadyGeek
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Re: I pulled out... How do I get back in?

Post by LadyGeek » Wed Oct 02, 2019 3:27 pm

I removed an off-topic post and several replies (conspiracy theory regarding the news media). As a reminder, see: Non-actionable (Trolling) Topics
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willthrill81
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Re: I pulled out... How do I get back in?

Post by willthrill81 » Wed Oct 02, 2019 3:54 pm

H-Town wrote:
Wed Oct 02, 2019 3:11 pm
HomerJ wrote:
Wed Oct 02, 2019 3:06 pm
H-Town wrote:
Wed Oct 02, 2019 1:55 pm
HomerJ wrote:
Wed Oct 02, 2019 1:34 pm
H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
A 50% run-up would be missed, and it might happen before the next 20% or more drop.

In fact, missing that 50% run-up might cause the OP to run out of money in retirement.

OP, pick an Asset Allocation that you can stick with... Since you're retired, go conservative... maybe 30/70 stocks/bonds. And just stick with it. But jumping in 100% one way or 100% the other way is the absolute worst way to invest.
OP is close to retirement and if OP saved enough to retire, why would he or she need to take more risk in this environment? If you won the game, why keep playing?
Because inflation is a risk, and one usually needs SOME growth to make a nest egg last 30-40 years.

I don't think 4% worked very well in the past with a 100% money-market portfolio.
It's better than a scenario when you have 50+% drop during your first few years of retirement.
A 50% drop in a portfolio has historically been extremely unlikely unless the portfolio was 100% stock or nearly so. A 50% drop in stocks would likely result in a ~25% drop in a 50/50 portfolio, and that's assuming that bonds experience no appreciation during the stock plunge. Granted, a 25% drop doesn't feel good, but that alone should certainly not warrant abandoning one's plan. I would argue that if retirees aren't prepared for a 50% drop in stocks immediately after they retire, then they aren't adequately prepared.
H-Town wrote:
Wed Oct 02, 2019 3:11 pm
I do know some stories about people who retired during 2007, 2008. They had to go back to work, and it's 2019 (12 years after their supposedly retirement).
It sounds like they were not well prepared for retirement (see above). If they had been, it's very unlikely that they would have "had" to go back to work. Year 2008 retirees have actually had much better overall returns and a far better sequence of returns than year 2000 retirees did. And year 2000 retirees are in good shape today.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

H-Town
Posts: 2019
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Re: I pulled out... How do I get back in?

Post by H-Town » Wed Oct 02, 2019 4:22 pm

willthrill81 wrote:
Wed Oct 02, 2019 3:54 pm
H-Town wrote:
Wed Oct 02, 2019 3:11 pm

It's better than a scenario when you have 50+% drop during your first few years of retirement.
A 50% drop in a portfolio has historically been extremely unlikely unless the portfolio was 100% stock or nearly so. A 50% drop in stocks would likely result in a ~25% drop in a 50/50 portfolio, and that's assuming that bonds experience no appreciation during the stock plunge. Granted, a 25% drop doesn't feel good, but that alone should certainly not warrant abandoning one's plan. I would argue that if retirees aren't prepared for a 50% drop in stocks immediately after they retire, then they aren't adequately prepared.
H-Town wrote:
Wed Oct 02, 2019 3:11 pm
I do know some stories about people who retired during 2007, 2008. They had to go back to work, and it's 2019 (12 years after their supposedly retirement).
It sounds like they were not well prepared for retirement (see above). If they had been, it's very unlikely that they would have "had" to go back to work. Year 2008 retirees have actually had much better overall returns and a far better sequence of returns than year 2000 retirees did. And year 2000 retirees are in good shape today.
Yeah, I lived through 2008 and it wasn't fun. I didn't sell, but I didn't know better to dump as much cash as I could into the market either. I just imagine the possibilities when I have another chance at the next market crash.

The person above was a senior manager at a megacorp with 6 figures salary back in 2008. He rode off to the sunset in early March 2008. Didn't know better. Panic sell at the wrong time, panic buy at the wrong time as well. He bought a big house with a huge pool back in 2006. He did all the things people would do during a bull market. Now he went back to the megacorp as a contractor capacity with a lower level of salary and still working.

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willthrill81
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Re: I pulled out... How do I get back in?

Post by willthrill81 » Wed Oct 02, 2019 4:27 pm

H-Town wrote:
Wed Oct 02, 2019 4:22 pm
willthrill81 wrote:
Wed Oct 02, 2019 3:54 pm
H-Town wrote:
Wed Oct 02, 2019 3:11 pm

It's better than a scenario when you have 50+% drop during your first few years of retirement.
A 50% drop in a portfolio has historically been extremely unlikely unless the portfolio was 100% stock or nearly so. A 50% drop in stocks would likely result in a ~25% drop in a 50/50 portfolio, and that's assuming that bonds experience no appreciation during the stock plunge. Granted, a 25% drop doesn't feel good, but that alone should certainly not warrant abandoning one's plan. I would argue that if retirees aren't prepared for a 50% drop in stocks immediately after they retire, then they aren't adequately prepared.
H-Town wrote:
Wed Oct 02, 2019 3:11 pm
I do know some stories about people who retired during 2007, 2008. They had to go back to work, and it's 2019 (12 years after their supposedly retirement).
It sounds like they were not well prepared for retirement (see above). If they had been, it's very unlikely that they would have "had" to go back to work. Year 2008 retirees have actually had much better overall returns and a far better sequence of returns than year 2000 retirees did. And year 2000 retirees are in good shape today.
Yeah, I lived through 2008 and it wasn't fun. I didn't sell, but I didn't know better to dump as much cash as I could into the market either. I just imagine the possibilities when I have another chance at the next market crash.

The person above was a senior manager at a megacorp with 6 figures salary back in 2008. He rode off to the sunset in early March 2008. Didn't know better. Panic sell at the wrong time, panic buy at the wrong time as well. He bought a big house with a huge pool back in 2006. He did all the things people would do during a bull market. Now he went back to the megacorp as a contractor capacity with a lower level of salary and still working.
That reminds me of Buffett's quote; "It's when the tide goes out that you discover who was skinny dipping."
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Domadosolo
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Re: I pulled out... How do I get back in?

Post by Domadosolo » Wed Oct 02, 2019 5:32 pm

deikel wrote:
Wed Oct 02, 2019 2:27 pm
HomerJ wrote:
Wed Oct 02, 2019 1:37 pm


Bad news always gets more clicks/views/ratings than good news.

This is actually something I wonder...is there a news channel out there that intentionally shows the good news ? I know Adriana had such a plan, but have not heard from that in a while....but if such thing existed, I would watch it - more then some others that I can not name here...I find positive news much more interesting actually...has it ever been tried ? Or was this a self fulfilling prophecy and hence we end up with the crap new we have these days.

But for the OP, I would be most curious what the asset allocation was that the OP pulled out of....because that would tell us a lot about OPs risk tolerance. Clearly OP was concerned about a 5% dip - so with that little risk tolerance, maybe actually staying out and investing in CDs or treasuries or real estate might not be such a bad idea.

I don't think the generic 50/50 will do here
Thanks
A) this ira is 33% of total portfolio So moving out, tho anti-bh, was more a function of potential buy opportunity than 5%dip risk aversion. ... I was ok losing a potential market gain of 10%. (Am I thinking clearly? :/)
B) ira has 90% stock, 10bond

Topic Author
Domadosolo
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Re: I pulled out... How do I get back in?

Post by Domadosolo » Wed Oct 02, 2019 5:35 pm

H-Town wrote:
Wed Oct 02, 2019 3:00 pm
frcabot wrote:
Wed Oct 02, 2019 2:31 pm
H-Town wrote:
Wed Oct 02, 2019 11:48 am
FrugalConservative wrote:
Wed Oct 02, 2019 11:38 am
H-Town wrote:
Wed Oct 02, 2019 11:36 am
Nah - I would wait... If you're already out, no need to rush to get back in. A 5%-10% run-up won't be missed. On the other hand, a 20% drop or more would do damage to your portfolio.

How to get in? No perfect method. Just buy in 10% of the cash during RBD (Really Bad Days) where market dropped 1.5% - 2% in the row. For example: I would buy some today. Not all. But maybe 10% and then wait and see for the next RBD.
This is horrible advice during the current bull market.
Yours could be worse. You implied that this is still a bull market. Best of lucks. :beer

Buying the dips gave me a decent profit during Dec 2018. Can't wait for the next one.
Buying the dip is completely different advice than “stay uninvested.”
Yeah, but take a look at OP's situation. OP already has cash flow to live on for the next 10 years. OP is retired. If OP can afford to buy the dips, why not?

I wouldn't recommend anyone to jump in/jump out of stock and time the market. But OP already jumped out. What done is done. If I have money sitting in MM right now, I'm in no rush to buy stocks. I'll buy during RBDs like today.
Over what period of time would you recommend ? Next 6 months?

YogurtRunner
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Re: I pulled out... How do I get back in?

Post by YogurtRunner » Wed Oct 02, 2019 5:57 pm

HomerJ wrote:
Wed Oct 02, 2019 1:34 pm
A 50% run-up would be missed, and it might happen before the next 20% or more drop.

...

I'm just curious as to where you eternal optimism stems from? We have had an outstanding year until recently and yet nothing in my portfolio has, to my knowledge, experienced a "50% run up." A couple of notable funds were hovering at 24% YTD until the recent unpleasantness and though I have not looked, I suspect those gains will all be gone by the end of the year in the same fashion as took place last year because that appears to be the "new game" where insiders are making their wealth at the expense of buy and holders who are now some 60% of the all indexes and are thus sheep ripe for the shearing. If I am saying anything too far out of line, please correct me, I am all ears. And yes, I am mostly one of those sheep, but I do have horns.

stocknoob4111
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Re: I pulled out... How do I get back in?

Post by stocknoob4111 » Wed Oct 02, 2019 6:15 pm

H-Town wrote:
Wed Oct 02, 2019 11:36 am
On the other hand, a 20% drop or more would do damage to your portfolio.
I read the statistics and 20% drops don't occur that often, although 5-10% drops happen much more often. We just had a 20% drop in Dec 2018 so I am not all that certain we are going to have back to back 20% drops. I feel waiting for that kind of a drop is not prudent as the statistics are not on your side.

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Wiggums
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Re: I pulled out... How do I get back in?

Post by Wiggums » Wed Oct 02, 2019 6:30 pm

Here’s the problem. You can buy back In over the next 6 months and then the market can crash. If you truly have a long term view of the market, you would jump in tomorrow regardless of the price or perhaps invest 10% a day. there is no magic to 6 month, a year or any other timeframe.

the best advice I have for you is to verify that your AA across all accounts is appropriate and then get back into the market. Buying the dips only works if you are willing to do that. today the market was down 500 points. Did you buy anything? are you looking for the bottom? It sounds like you have a lot of fixed assets, so I am not sure if you’re still trying to protect your balance By jumping out or letting the tv news scare you.

Some people are good at buying the dips. I am not one of them. I like to buy and hold. I ignore the news and I have a lot of fixed income so that I don’t have to sell for cash flow.

I hope this helps.

KandT
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Re: I pulled out... How do I get back in?

Post by KandT » Wed Oct 02, 2019 6:49 pm

No one can answer that but you. Some people would be cool putting all their money on "Red" in Vegas. Others want their money in the bank. Others ride believe in the long term growth of the economy so they buy and hold.

You have to decide what type of investor you are.

Independent George
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Re: I pulled out... How do I get back in?

Post by Independent George » Wed Oct 02, 2019 7:02 pm

Pick an AA and stick to it.

zeal
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Re: I pulled out... How do I get back in?

Post by zeal » Wed Oct 02, 2019 7:08 pm

[OT comment removed by admin LadyGeek]

Just get back in at the earliest opportunity like we all try to do. The market is a fickle thing but you gotta commit to it if you want the rewards, none of this on-again off-again type stuff. Best of luck.

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Nate79
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Location: Delaware

Re: I pulled out... How do I get back in?

Post by Nate79 » Wed Oct 02, 2019 9:39 pm

Get back in asap and quit playing around with a failed market timing attempt. Market timing doesn't work so stop trying to play that game. Ignore the timing noise.

z3r0c00l
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Re: I pulled out... How do I get back in?

Post by z3r0c00l » Wed Oct 02, 2019 9:52 pm

Devil's advocate: Stay out since you don't have the track record of being able to maintain a steady course. Plenty of people can make do with CDs and cash, just live a little simpler, work a little longer, etc. This isn't a more is lost through indecision scenario, more is lost by market timing attempts.
Last edited by z3r0c00l on Thu Oct 03, 2019 7:29 am, edited 1 time in total.

anoop
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Re: I pulled out... How do I get back in?

Post by anoop » Thu Oct 03, 2019 12:19 am

I pulled out in Feb 2008 and never got back in, so I can't help you. :)

wolf359
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Re: I pulled out... How do I get back in?

Post by wolf359 » Thu Oct 03, 2019 12:47 am

Domadosolo wrote:
Wed Oct 02, 2019 11:17 am
I have all my IRA in MM.
Suggestions for getting back in the market? ETFs?

Why did i pull out? I wanted to hedge some market downside, anticipating a 5% drop with the global uncertainty, knowing i could miss a 5% upside
I didn't pull out of the taxable assets due to tax issues,
Silly me, pulled out trying to time the market, anticipating a 5% drop...
But, Market is down so I might start getting in.

What do you suggest?

-58y, retired, sufficient cash flow from taxable assets for the next 10 years.
If you have sufficient cash flow from taxable assets for the next 10 years, then look at the stock market charts with a 10 year perspective. How does it look?

Spoiler: It looks like there isn't even a dip!

What is your desired asset allocation? I think it's time to rebalance into it.

You need to write an investment policy statement, including what you will do in certain market circumstances, and stick to that plan. If you're recently retired, it's a good time to update that plan.

tesuzuki2002
Posts: 784
Joined: Fri Dec 11, 2015 12:40 pm

Re: I pulled out... How do I get back in?

Post by tesuzuki2002 » Thu Oct 03, 2019 12:51 am

KingRiggs wrote:
Wed Oct 02, 2019 3:04 pm
KingRiggs wrote:
Wed Oct 02, 2019 2:40 pm
Market is rebounding right now...too late! :beer
Oh, wait...it's back down now...sell! :oops:
BUY, BUY, BUY!!!.
:sharebeer

gr7070
Posts: 328
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Re: I pulled out... How do I get back in?

Post by gr7070 » Thu Oct 03, 2019 4:33 am

I played poker with a guy three or four years ago who did the same thing. Said he wouldn't get back in until after The Correction.

I assume he's still waiting for that correction. He lost a frightful amount of money these last year's.

GoldenFinch
Posts: 1936
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Re: I pulled out... How do I get back in?

Post by GoldenFinch » Thu Oct 03, 2019 4:35 am

YogurtRunner wrote:
Wed Oct 02, 2019 5:57 pm
HomerJ wrote:
Wed Oct 02, 2019 1:34 pm
A 50% run-up would be missed, and it might happen before the next 20% or more drop.

...

I'm just curious as to where you eternal optimism stems from? We have had an outstanding year until recently and yet nothing in my portfolio has, to my knowledge, experienced a "50% run up." A couple of notable funds were hovering at 24% YTD until the recent unpleasantness and though I have not looked, I suspect those gains will all be gone by the end of the year in the same fashion as took place last year because that appears to be the "new game" where insiders are making their wealth at the expense of buy and holders who are now some 60% of the all indexes and are thus sheep ripe for the shearing. If I am saying anything too far out of line, please correct me, I am all ears. And yes, I am mostly one of those sheep, but I do have horns.
I think Homer’s point is that “nobody knows nothin,’” or that none of us can predict a 20% drop or a 50% run-up, but if you’re invested with a reasonable asset allocation you won’t miss out on the general long term growth of your portfolio that all of us here are predicting. Does that make sense? :twisted: :happy

UpperNwGuy
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Re: I pulled out... How do I get back in?

Post by UpperNwGuy » Thu Oct 03, 2019 7:05 am

KlangFool wrote:
Wed Oct 02, 2019 12:47 pm
OP,

No ETF. Pick a target retirement fund.

KlangFool
+1

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