BH gratitude - my first rebalancing against an actual plan

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NashTransplant
Posts: 115
Joined: Mon May 22, 2023 3:28 pm

BH gratitude - my first rebalancing against an actual plan

Post by NashTransplant »

Since I only became part of this community in the last two years, I only created an actual personal investment plan 18 months ago. Prior to that, I was on a generally OK track via index investing, but honestly I had no real plan other than save pre-tax money and invest in index funds.

Over the past couple of months I hit my plan's "trigger point" on rebalancing - in my case, veering 5% off from my desired allocation. Given the nature of markets the last two years, that predictably was that I became equity-heavy. So yesterday I sold stock funds and bought bond funds to get back to the plan levels.

And the cool thing was - I felt great about it, thanks to the wisdom of this community. Not because I think bonds will outperform stocks - I have no idea whatsoever. But because I had a plan, I had pre-determined action steps to take against the plan, I have comfort in knowing that I don't know how any investment will perform, but I know that the plan itself has some logic behind it. And I know that I am selling something that has gone up and buying something that has gone down, and that feels good too.

This community will probably save/make me money over the long term, but just as important - it gives me a much greater sense of security and stops my constant second-guessing of myself. Very glad to be a part of things here. Onward.
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retired@50
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Joined: Tue Oct 01, 2019 2:36 pm
Location: Living in the U.S.A.

Re: BH gratitude - my first rebalancing against an actual plan

Post by retired@50 »

NashTransplant wrote: Tue Jul 09, 2024 1:04 pm And the cool thing was - I felt great about it, thanks to the wisdom of this community.
Good for you. This is the right frame of mind.

Regards,
"All of us would be better investors if we just made fewer decisions." - Daniel Kahneman
bonesly
Posts: 1659
Joined: Mon Dec 18, 2017 9:28 pm
Location: WA

Re: BH gratitude - my first rebalancing against an actual plan

Post by bonesly »

NashTransplant wrote: Tue Jul 09, 2024 1:04 pm Over the past couple of months I hit my plan's "trigger point" on rebalancing - in my case, veering 5% off from my desired allocation. Given the nature of markets the last two years, that predictably was that I became equity-heavy. So yesterday I sold stock funds and bought bond funds to get back to the plan levels. ... And the cool thing was - I felt great about it, thanks to the wisdom of this community.
Congratulations on your first post-plan action on "the boring path to accumulate wealth"! :D
Don't do what Bogleheads tell you. Listen to what we say, consider other sources, and make your own decisions, since you have to live with the risks & rewards (not us or anyone else).
heisenberg.
Posts: 84
Joined: Fri Aug 28, 2020 11:46 am

Re: BH gratitude - my first rebalancing against an actual plan

Post by heisenberg. »

I love this post and hope it won’t get buried amongst all the FOMO threads..

To me personally it actually feels even better to ‘drop some dry powder’ into equities when i rebalance during ancorrection. March 2020 was so fun - hindsight included
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