llessac15 wrote:Is there any Bogleheads out there that has decided to hold onto cash right now since valuations are so high and interest rates are so low? I know that the 'Bogle' answer is to stay the course and just keep eating my allocation plan for breakfast. But it just feels so foolish right now to put money into such an inflated market or to expects bonds to produce anything to write home about.
I'm in my late 30's and have at least 15-20 years until I retire. I'm considering putting any new investment money into my savings account for the next 3-5 years until I see some kind of dip in the market. I know it's market timing, but I'm tired of buying expensive stocks via my index funds. Anyone else drinking that my same kool-aid?
Here's the good news, if I'm reading your post correctly. You haven't panic sold and are "going all cash" as many others have done recently, you are just putting money, that you would usually invest, into a savings account for 3-5 years. That gives you plenty of time to think about the answers you've received here and I suspect that you will reconsider your thinking in a time frame of closer to 3-5 weeks or months.
Here's the bad news. You have failed to define a plan, other than "some kind
of dip in the market" What kind?
To have a plan you must define your kind.
When the market dips x%, you will do what?.
I suspect that once you play around with math and percentages, as we all have done at one time or another, you will begin to see how futile it is to define an exact kind
of dip. So go ahead and stash some cash for a little bit, if it makes you feel better, but use the time to define a real plan, a long term plan, not just a short term dip plan. If sitting on cash allows you to come up with a better long term plan, it will turn out to be a good short term investment strategy.
"The stock market is a giant distraction from the business of investing." - Jack Bogle