Young investors, how do you feel about your 1st market crash?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
surfstar
Posts: 2273
Joined: Fri Sep 13, 2013 12:17 pm
Location: Santa Barbara, CA

Re: Young investors, how do you feel about your 1st market crash?

Post by surfstar »

runner3081 wrote: Fri Mar 20, 2020 8:40 am 39. Wish I had more money to put in the market at the moment.
Ditto on both counts.
We max all tax-advantaged options, but still would like to stash more away (likely will be able to start a taxable account this year, but not a huge one - good time to start at least)
stoptothink
Posts: 8509
Joined: Fri Dec 31, 2010 9:53 am

Re: Young investors, how do you feel about your 1st market crash?

Post by stoptothink »

surfstar wrote: Mon Mar 23, 2020 5:26 pm
runner3081 wrote: Fri Mar 20, 2020 8:40 am 39. Wish I had more money to put in the market at the moment.
Ditto on both counts.
We max all tax-advantaged options, but still would like to stash more away (likely will be able to start a taxable account this year, but not a huge one - good time to start at least)
Same position; we're very torn about getting rid of the mortgage ($14k to go), starting taxable, or bolstering cash/EF (~$6k ATM). Probably going to end up with a mixture of both.
EFF_fan81
Posts: 404
Joined: Sat Jan 07, 2012 11:23 am

Re: Young investors, how do you feel about your 1st market crash?

Post by EFF_fan81 »

I was theoretically 85/15 but I would purposefully let it drift upwards as I didn't like bond yields. Now I'm happy I have it!

I have no sudden urge to switch to a more conservative allocation now, I'd rather roll the dice and just work longer if I need to, but I can definitely appreciate the wisdom now of having a more conservative allocation as one gets older. I'd hate to lose all this much money a few years before retirement, and at risk of job loss or income decline at the same time.

Now, I know if I hang on and keep working, even if it takes a decade or more, I'll have all this back and then more. But you can't predict that at 57 -- maybe or maybe not -- so it would be best to be safer just to be sure.
SandraBumble
Posts: 12
Joined: Sun Apr 08, 2018 5:48 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by SandraBumble »

I'm 34. I've been investing since 2013, though I had much more to go in in recent years, and right now I am about even: i.e. on balance, all my gains and income are gone, but I'm not yet down from my principle. I'd be basically equivalent if I'd just kept money in a savings account all these years.

I'm trying to think of it that way-- as in, if I were buying in now for the first time, I would probably have gone in when the market is 30-plus percent down (or sooner) and felt ok about it. Rather than focusing on how much I lost, although I do keep thinking about that-- I'd gotten used to the comfort of thinking that money was "there," even though my emergency fund and income are fine. And it's been clear for ages that people weren't taking this at all seriously enough, but I didn't do anything about it.

I think my tendency is to want to be a market timer, but I never actually take action because I distrust my guesses and know market timing is dumb. (Usually I stress about when to buy, but don't stress about selling because I just never sell. I partially sat out the market during 2019 because it felt too inflated, but then reluctantly bought a fair amount at the end of the year/early 2020 because I needed to fill my solo 401k on a payroll schedule, and now feel resentment toward the companies buying back stock and the Fed's refusal to raise rates and Trump's huge corporate tax cuts, which all helped push things up into an absurd bubble that I knew I didn't want to buy, but I did buy). It feels way too late to take money off the table now, but obviously I wish I'd done it sooner, and I feel some probably irrational resentment about that....when I wanted to sell in February, I came here and convinced myself not to. But I also nibbled way too early, which is the same thing I did in 2018! And then I got over-cautious and stopped buying, thinking there will be a further drop. So clearly my crystal ball is broken.

I don't know how this will affect my future investing behavior. I think I'll be a lot more cautious if/when things recover. Maybe too cautious. I'm probably learning dangerous "lessons". Anyway, I'm not one who's feeling cavalier.
User avatar
inittowinit
Posts: 154
Joined: Thu Jul 05, 2012 6:37 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by inittowinit »

I'm 30, been investing 10 years.

This is more or less playing out in line with what I've been prepared for by the many Bogleheads posts and finance books I've read over that time.

I'm staying the course with my current investments, but keeping all new savings in cash to prepare for potential layoffs and subsequent depression. Once I have enough saved to feel safe, I may start investing again. Hard to say how much will make me feel "safe" though, given the historical economic cliff we're currently driving off...
User avatar
1789
Posts: 1796
Joined: Fri Aug 16, 2019 3:31 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by 1789 »

Age 36. Started investing 3 years ago. I had around 120k and lost like 40k. I felt nothing. To be honest with you i believe i couldn't say the same thing if i had a million and lost 300k. Anyway, i am planning to put 40-50k this year in retirement accounts including some mega back door roth. We only held SP500/US TSM and CA$H. I think the key is to be able to figure out how would i feel if i lost say 500k. That i don't have the answer.
"My conscience wants vegetarianism to win over the world. And my subconscious is yearning for a piece of juicy meat. But what do i want?" (Andrei Tarkovsky)
hadron
Posts: 45
Joined: Wed Aug 07, 2013 11:57 pm
Location: Big Apple

Re: Young investors, how do you feel about your 1st market crash?

Post by hadron »

39. Portfolio was ~2.5M at peak, now around 1.9M. Rebalanced to buy more stocks and plan to buy more with RSU monies. Overall not worried about finances. In fact this is a good situation to be in for me as I'm still in accumulation phase. More concerned about the health of my parents. Also, a lot of folks will be hit hard financially due to this, so I am bit sad about that as well.
softmax
Posts: 162
Joined: Tue Feb 04, 2020 1:27 am

Re: Young investors, how do you feel about your 1st market crash?

Post by softmax »

I'm 28. I felt nothing. My accounts can go zero and my life quality wouldn't be affected.
I also hope this crash can be a real crash (-50%?). It would be a life experience that is worth every penny.

As a foreigner on H-1B visa, I could lost everything I have in the US if I lost my job and couldn't find a new one within 60 days.
The only thing I ask myself is whether I'm competitive in the job market. If the answer is yes, I sleep perfectly well.

It also does't matter if the market goes back. If the economy is that bad, I'll just figure out another way to build wealth.
surfstar
Posts: 2273
Joined: Fri Sep 13, 2013 12:17 pm
Location: Santa Barbara, CA

Re: Young investors, how do you feel about your 1st market crash?

Post by surfstar »

Despite my increasing consumption of the market-Corona Virus news, since we do not track our overall net worth at all, and usually only update our AA spreadsheet, which has Roth/457/TSP accounts, quarterly; the "crash" impact won't look all that bad. Its just a point-in-time balance total in a table. No chart. No %s.
Since 12/31/2019, we fully funded our 2020 Roths (in Jan - D'oh!) and always contribute the max amount biweekly. So despite a 30%+ drop in equities, our spreadsheet tracking won't show a 30% drop from 12/31. This will soften the blow for sure. We just don't need that level of detail, and I do not actually track our IRR/annual performance or anything like that. Ironic as I love data and will track my vehicle mpg per fill-up over years and years.
The KISS strategy of low-priced index funds really helps in this regard. Save as much as we can and that will be more determinative of our final portfolio value, than when and what we bought.

I have updated the numbers un-officially to track AA and rebalance if necessary, but until we do our 3/31 timestamped total, the losses don't look permanent yet. :?
beefeater
Posts: 16
Joined: Sun Aug 25, 2019 12:08 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by beefeater »

{deleted}
Last edited by beefeater on Mon May 18, 2020 1:40 pm, edited 1 time in total.
seychellois_lib
Posts: 271
Joined: Tue Mar 25, 2014 12:05 am

Re: Young investors, how do you feel about your 1st market crash?

Post by seychellois_lib »

inittowinit wrote: Mon Mar 23, 2020 6:36 pm I'm 30, been investing 10 years.

This is more or less playing out in line with what I've been prepared for by the many Bogleheads posts and finance books I've read over that time.

I'm staying the course with my current investments, but keeping all new savings in cash to prepare for potential layoffs and subsequent depression. Once I have enough saved to feel safe, I may start investing again. Hard to say how much will make me feel "safe" though, given the historical economic cliff we're currently driving off...
I'm 68 and I think yours is a very reasonable approach. Get your emergency fund set. But you ought to have a plan as to what the baseline emergency fund needs to be, get there and then re-evaluate. When I was your age I wish to Goodness I had been much more open to equities. I am deeply embarrassed to say that I thought savings bonds were the way to go. I did not get my act together until 1999 and it absolutely saved my retirement.
I worked for the manufacturer of the Globalstar constellation. I lost a lot of money on that pipe dream too. Classic mistake, so diversify with a capital D.

Don't overdo the emergency fund. Equities may look like a black hole right now but, you are going to have to re-start investment in them. I think a depression - ie a long term (10 to 15 year) lack of economic growth accompanied by deflation and widespread poverty is highly unlikely. Not impossible of course but if you are 30, you have all the time in the world, you would even be able to overcome a 15 year downturn. Can you imagine coming out of that with a well diversified portfolio?
squirm
Posts: 3004
Joined: Sat Mar 19, 2011 11:53 am

Re: Young investors, how do you feel about your 1st market crash?

Post by squirm »

Annabel Lee wrote: Sun Mar 22, 2020 8:20 pm Legitimate question: does Dow 10,000 (or lower) change the relatively sanguine responses to this thread so far?

Genuinely curious as to if this is a point-in-time thread or if a 70% drop from market heights would change minds.

While priority is obviously staying healthy and staying concerned for family, I am 35 and would be lying if I said I wasn’t bothered by a $200k+ paper drop across 401k, unvested RSUs and taxable so far. The US corporate world is unkind to 50+ year olds generally; this level of portfolio reduction sucks when looking at reduced income generation. Of course, nothing I can do about it now.
Let's get out those Dow 10,000 hats again. Maybe CNBC will have a Dow 10,000 special like they did twenty something years ago.

Frankly, it's a little scary seeing all those who said they're fine with the recent downturn. I would think Dow 10,000 there would be panic, which is good.
squirm
Posts: 3004
Joined: Sat Mar 19, 2011 11:53 am

Re: Young investors, how do you feel about your 1st market crash?

Post by squirm »

softmax wrote: Mon Mar 23, 2020 6:52 pm I'm 28. I felt nothing. My accounts can go zero and my life quality wouldn't be affected.
I also hope this crash can be a real crash (-50%?). It would be a life experience that is worth every penny.

As a foreigner on H-1B visa, I could lost everything I have in the US if I lost my job and couldn't find a new one within 60 days.
The only thing I ask myself is whether I'm competitive in the job market. If the answer is yes, I sleep perfectly well.

It also does't matter if the market goes back. If the economy is that bad, I'll just figure out another way to build wealth.
Be careful what you wish for. 50% would take us down to about 1600 and probably a lot of unemployment claims that we haven't seen before.
6bquick
Posts: 120
Joined: Sat Mar 26, 2016 8:56 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by 6bquick »

pasadena wrote: Sun Mar 22, 2020 8:21 pm
Lee_WSP wrote: Fri Mar 20, 2020 12:10 pm I've realized that my emergency fund is not nearly as large as it should be. I should not have lump summed in 2020's contributions. That's my biggest takeaway.
This. This has been the main lesson for me, so far. I'm also somehow starting to look at my non-retirement investments in terms of "how many months or years of living expenses do they cover", which tells me that my EF still isn't as large as it should be.
Bingo. Same here. Early 30's, 2 little kids. have 6mo in cash and the rest is 80/20 across the board. lost bigly (at least to me) in Roth's, 529s, HSA, 401k, but it honestly doesn't phase me in the slightest, had no plans on using that for 20-30 years. Don't really know how to explain it; the losses almost feel abstract. However the equally bigly loss in taxable has me wishing I had more months cash just in case. I'm mostly 1099, and the cushion would be nice. I can't explain why, our taxable account isn't even 'short term' stuff for us. not retirement funds, per se, but had no real intention of touching them for 7-10 years at least. But, those losses feel more visceral, and I feel more vulnerable now than I did 2/1/2020. Heck, I may have just described not being ok with my AA, but what do I know. ha. :beer
JasonA1987
Posts: 25
Joined: Tue Dec 06, 2016 5:56 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by JasonA1987 »

32. 100% equities. The only thing I’m sad about is not having any money to invest more, but at the same time, my budget is pretty tight and all excess already goes to stocks. Money isn’t emotional for me, so I’m pretty happy to have a few years of accumulating at a lower cost

A huge part of the lack of worry is my wife and I have stable jobs in the medical field. So...yeah...we won’t be laid off. I feel bad for a lot of the world/country right now.

:sharebeer
Last edited by JasonA1987 on Mon Mar 23, 2020 7:46 pm, edited 1 time in total.
triggerfish10
Posts: 110
Joined: Sat Apr 26, 2014 9:07 am
Location: Midwest

Re: Young investors, how do you feel about your 1st market crash?

Post by triggerfish10 »

42. I started investing in 2009, so I missed the big 2008 crash. And I wasn't exactly paying attention to the market all that much at the end of 2018, so it was business as usual. Thus far I am not phased by this crash, despite having an 80/20 portfolio. I don't have an IPS but I do have a defined AA, complete with rebalancing bands. However, since I still have a pretty long time horizon, I am confident that, in time, I will come out of this ok. For now, I am not exactly rebalancing based on my bands; instead, I am slowly converting bonds into stocks based on which of my index funds (total US, US extended market, total international, emerging markets, real estate, and total bond) has lost the most (percentage wise) YTD. Two of the funds are now down ~40%. I feel like those are the best bargains thus far, and should (I hope) produce the greatest returns going forward. Thus far I have converted just over 20% of my bond portfolio into stocks, with more room to convert as prices continue to go down. I am also investing in my workplace 403b just as I always have, and will max it out before the end of the year.

The reason I am not all that concerned right now is that I have a very healthy emergency fund (my wife and I had planned on having an addition built onto our house and were saving up for it) and my wife and I both have very stable jobs. Once the economy turns around, my plan is to rebalance back into my original AA (although I am not far off from it right now). I understand that this is a bit of market timing, but if I can stomach buying more stocks now, it should pay off in the long run. Now if I were in my 50's... :shock:
"A quiet and modest life brings more joy than a pursuit of success bound with constant unrest" - Albert Einstein
leemalk
Posts: 9
Joined: Sun Dec 03, 2017 3:29 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by leemalk »

31. Doing fine with it so far. I've always held a relatively large amount in cash (compared to a typical Boglehead) as I'm rather risk averse. I probably have something like 18+ months of expenses saved so that helps me stay comfortable. And at least for the time being my job appears very secure, so that helps.

I used to be in the habit of checking my portfolio balances each month and recording...stopped doing that in February. Maybe I'll get into that habit again in a few months.

I also deleted all stock apps of my phone and removed any news notifications. I'm basically taking the mindset that my brokerage/401k accounts don't exist at the moment. :sharebeer
User avatar
Noobvestor
Posts: 5655
Joined: Mon Aug 23, 2010 1:09 am

Re: Young investors, how do you feel about your 1st market crash?

Post by Noobvestor »

settlement12 wrote: Fri Mar 20, 2020 6:57 am
MotoTrojan wrote: Fri Mar 20, 2020 6:41 am
settlement12 wrote: Fri Mar 20, 2020 5:23 am Aged 29, started investing in 2015 after the mini crash in august. Bought in 100% equities. Sold out last year to avail of lower CGT after a move abroad but did not buy back in due to a concern about impending bear market. Now DCA'ing back in into 100% equities
You got lucky but now I fear for your future.

Imagine you had similar success back in 2000. The year is now 2011 and the financial media is talking non-stop about a bear/crash coming; you decide to stay in cash. When do you get back in? Ever?
Yeah I got lucky. I've already got back in 25% of my total cash on Monday. I'm planning on doing 3x more 25% DCAs, spread over the next few weeks. If it goes down further I'll just be glad that I won't be hit as hard as others, if it goes up well then well and good.
You got lucky, and now you're pushing your luck DCAing back in. Might want to just find an allocation you can buy, hold and rebalance. /2 cents
"In the absence of clarity, diversification is the only logical strategy" -= Larry Swedroe
User avatar
DameTime
Posts: 33
Joined: Mon Jul 08, 2019 8:04 pm
Location: SE

Re: Young investors, how do you feel about your 1st market crash?

Post by DameTime »

32yo medical professional here so only been investing heavily the last 2 years (aside from Roth IRAs). 85/15 before the downturn. Riding it out fine. Rebalanced a couple weeks ago but need to look again. Reading Bogleheads actually makes me more anxious than anything else but hard to turn away.

More worried about job income as elective procedures being cancelled and clinic shut downs are going to drop my production significantly. Goal was to be FI by 40 at 30x expenses but was always planning to work awhile after that.

Downturn doesn’t really change the timeline but does in my mind reinforce the importance of a more conservative AA as I get closer to retirement age.
cpan00b
Posts: 132
Joined: Wed May 10, 2017 9:39 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by cpan00b »

I feel anxious BUT not about the market decline and losses (which are unrealized). I am more anxious about job security, opportunity cost and time. I grinded really hard the past few years (law school and then biglaw since 2017, which was difficult, to understate it) and as a result, feel like while I was at the peak of my earning potential, I invested all of that money, which has now performed less than stellar. I assume if I am laid off from my current job (no longer in big law), i'll likely take a 50% paycut at least in this economy, so will be earning half my salary and not able to purchase equity at lower prices.

I'm going to turn 31 this year, so relatively young and as of today's close am down -$118k or -36.8% for the year. Currently at an asset allocation of 94-6 (kept catching the falling knife over the past few weeks as I initially had an 80-20 allocation at the beginning of February). I'm going to sell off the measly 18k bond index constituting that 6% in my 401k and go all-in at 100-0 over the next few weeks and keep purchasing VTSAX and VTIAX with each pay check. Given this decline I feel like I can stomach even a 50% decline and hit -200k if the market keeps declining in the next few weeks.

I have enough money set aside in cash to last me a year of unemployment, so my plan now is to invest every other single dollar in the market - buy on the way down and buy back on the way up.

I was hoping to hit my first million by 34 but looks like that's been derailed now. Still I am grateful for what I do have and I know most people my age are still pretty behind.
mnsportsgeek
Posts: 311
Joined: Mon Jan 19, 2015 1:39 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by mnsportsgeek »

The market crash really doesn’t phase me. I’ve got an 85/15 allocation right now and this is my first real dip in the market since I started investing 6 years ago.

Fortunately I had a bunch of money in cash for an eventual house down payment and now I think this summer might finally be the right time to get a good deal on a house. Because of this chunk of money in cash, my net worth has only dipped from 470k to about 400k. A significant loss, but not terrible if we really are near the bottom.

So the markets don’t keep me up at night. However, I am fearful that our jobs are at risk and that does bother me. So I guess you could say I’m fearful of a recession, but not in the sense of how it will affect my 401k.
FRT15
Posts: 75
Joined: Wed Dec 16, 2015 9:58 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by FRT15 »

For the people who rejoice in prices going lower and buying more do you have any concerns about your employment over the next 2-5 years? I'm just trying to learn more of the mindset. I have always thought money in the market is money I should be prepared to lose but it seems like other people don't have that fear and just assume prices will come back.
RealHornblower
Posts: 14
Joined: Sun Dec 24, 2017 11:55 am

Re: Young investors, how do you feel about your 1st market crash?

Post by RealHornblower »

I'm not worried about my losses from an investment standpoint, but I just started a new job. As long as I don't get laid off, I will keep buying all the way down and back up.
settlement12
Posts: 38
Joined: Sun Mar 08, 2020 8:04 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by settlement12 »

Noobvestor wrote: Mon Mar 23, 2020 8:07 pm
settlement12 wrote: Fri Mar 20, 2020 6:57 am
MotoTrojan wrote: Fri Mar 20, 2020 6:41 am
settlement12 wrote: Fri Mar 20, 2020 5:23 am Aged 29, started investing in 2015 after the mini crash in august. Bought in 100% equities. Sold out last year to avail of lower CGT after a move abroad but did not buy back in due to a concern about impending bear market. Now DCA'ing back in into 100% equities
You got lucky but now I fear for your future.

Imagine you had similar success back in 2000. The year is now 2011 and the financial media is talking non-stop about a bear/crash coming; you decide to stay in cash. When do you get back in? Ever?
Yeah I got lucky. I've already got back in 25% of my total cash on Monday. I'm planning on doing 3x more 25% DCAs, spread over the next few weeks. If it goes down further I'll just be glad that I won't be hit as hard as others, if it goes up well then well and good.
You got lucky, and now you're pushing your luck DCAing back in. Might want to just find an allocation you can buy, hold and rebalance. /2 cents
My AA will be 100% stocks. DCA'ing seems to work well in a recession, otherwise I'd be looking to time the bottom and we all know that's a terrible idea. This way I won't miss the upswing if it happens anytime soon
softmax
Posts: 162
Joined: Tue Feb 04, 2020 1:27 am

Re: Young investors, how do you feel about your 1st market crash?

Post by softmax »

squirm wrote: Mon Mar 23, 2020 7:11 pm
softmax wrote: Mon Mar 23, 2020 6:52 pm I'm 28. I felt nothing. My accounts can go zero and my life quality wouldn't be affected.
I also hope this crash can be a real crash (-50%?). It would be a life experience that is worth every penny.

As a foreigner on H-1B visa, I could lost everything I have in the US if I lost my job and couldn't find a new one within 60 days.
The only thing I ask myself is whether I'm competitive in the job market. If the answer is yes, I sleep perfectly well.

It also does't matter if the market goes back. If the economy is that bad, I'll just figure out another way to build wealth.
Be careful what you wish for. 50% would take us down to about 1600 and probably a lot of unemployment claims that we haven't seen before.
I don't know. I feel that the dip is not just due to covid-19. Perhaps some people are leveraging this as an opportunity to transit us into a real financial crisis like 2008. If we *have to* experience a significant market crash in this decade, I wish this is just the one so we don't have another one soon.
LiterallyIronic
Posts: 1463
Joined: Sat Dec 05, 2015 10:36 am

Re: Young investors, how do you feel about your 1st market crash?

Post by LiterallyIronic »

FRT15 wrote: Mon Mar 23, 2020 8:45 pm For the people who rejoice in prices going lower and buying more do you have any concerns about your employment over the next 2-5 years? I'm just trying to learn more of the mindset. I have always thought money in the market is money I should be prepared to lose but it seems like other people don't have that fear and just assume prices will come back.
I have concerns about my employment 24/7/365, regardless of what the market is doing. Eventually, everyone is going to figure out that I'm a mediocre programmer and way overpaid. Just got to keep socking away money as long as the gravy train lasts.
imareal1
Posts: 42
Joined: Fri May 05, 2017 1:22 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by imareal1 »

Age 27 with ~$100K all in (after the 30% drop). AA is 90/10.

The crash does not faze me at all precisely because of my age and investing horizon. Not sure how anyone in the same boat would feel any other way if they're truly buying and holding long term.

IMO, it's downright irrational to freak out about crashes because
A) if you're young, you don't have a lot of $$ to lose AND the market will recover
B) if you're old, your portfolio should reflect the proper AA such that crashes wouldn't hurt MORE THAN what you were willing to tolerate

Am I missing something here?
User avatar
Noobvestor
Posts: 5655
Joined: Mon Aug 23, 2010 1:09 am

Re: Young investors, how do you feel about your 1st market crash?

Post by Noobvestor »

settlement12 wrote: Tue Mar 24, 2020 7:12 am
Noobvestor wrote: Mon Mar 23, 2020 8:07 pm
settlement12 wrote: Fri Mar 20, 2020 6:57 am
MotoTrojan wrote: Fri Mar 20, 2020 6:41 am
settlement12 wrote: Fri Mar 20, 2020 5:23 am Aged 29, started investing in 2015 after the mini crash in august. Bought in 100% equities. Sold out last year to avail of lower CGT after a move abroad but did not buy back in due to a concern about impending bear market. Now DCA'ing back in into 100% equities
You got lucky but now I fear for your future.

Imagine you had similar success back in 2000. The year is now 2011 and the financial media is talking non-stop about a bear/crash coming; you decide to stay in cash. When do you get back in? Ever?
Yeah I got lucky. I've already got back in 25% of my total cash on Monday. I'm planning on doing 3x more 25% DCAs, spread over the next few weeks. If it goes down further I'll just be glad that I won't be hit as hard as others, if it goes up well then well and good.
You got lucky, and now you're pushing your luck DCAing back in. Might want to just find an allocation you can buy, hold and rebalance. /2 cents
My AA will be 100% stocks. DCA'ing seems to work well in a recession, otherwise I'd be looking to time the bottom and we all know that's a terrible idea. This way I won't miss the upswing if it happens anytime soon
Markets are up close to 10% today. Was this the bottom? I don't know. But if it was, will you feel comfortable with your decision?
"In the absence of clarity, diversification is the only logical strategy" -= Larry Swedroe
Rock Lobster
Posts: 7
Joined: Fri Mar 17, 2017 3:12 am

Re: Young investors, how do you feel about your 1st market crash?

Post by Rock Lobster »

35 with only about $30,000 invested out of six figures.

I'm waiting for things to calm down a bit before going in with more. So far I've lost about $7,000 of a $12,000 investment in my IRA (maxed out for 2019 and 2020).

I'm staying the course with FFNOX currently (85% stocks / 15% bonds), my main investment, and I plan on switching my IRA to all Amazon and then my brokerage / taxable account to FFNOX once I put in about $50,000 to $75,000 more.

I suppose I like taking a risk. I think Amazon is going to keep rising and it has no competitors that I can see. As someone once said in another thread: it's all Monopoly money to me.

I want to keep the rest in cash just in case I need it for emergencies or I lose my job during this recession.
Moochy
Posts: 25
Joined: Sun Apr 15, 2018 2:44 am

Re: Young investors, how do you feel about your 1st market crash?

Post by Moochy »

Welcome to the Federal Reserve ez money bubble number three.
2000-2001 market crash
2007-2008 market crash
2020-we are just starting, this one imo, will be worse than the prior two.

Image
hungryforhummus
Posts: 12
Joined: Wed Apr 17, 2019 7:42 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by hungryforhummus »

25 years old. I feel great about it due to some incredibly good dumb luck and having internalized the boglehead philosophy to buy/hold and buy more at discounts. I had a company Traditional/Roth 401k change of provider and rolled over everything into my IRA/Roth IRA at vanguard due to lower expense ratios compared to employer options. I traveled for 1.5 months and was thrown into a lot of new work projects after coming back to the states which delayed me from allocating that chunk. Ended up going from 90% stocks 10% bonds to 35% stocks 65% vangaurd settlement fund. Market crashed 25% and put in that 45k DCAing on the way down over the last 1.5 weeks followed with investing my 2019 HSA contribution and a new 2020 roth ira contribution. Overall portfolio returns turned green today from the DCA purchases which is irrelevant as I'm investing for a long time horizon, but it felt nice to see a temporary gain from purchasing while everything was tanking. I plan on making my 2020 HSA and 529 contributions soon and investing to buy the discounted market letting my new 401k paycheck contributions continue on auto-pilot. Will be targeting 100% stock allocation and considering creating a taxable account for additional investment depending on how much dry powder I want to keep for a future mortgage down payment. Job will be stable and my emergency fund is there as a backup, so i'm going to be as aggressive as I can saving/investing over the next 2 quarters...and beyond. I am fortunate to have a retention bonus larger than my emergency fund that would pay out within 3 days if I was let go and have considered investing some of my current emergency fund, but am now thinking to just keep that as is for my parent's risky single-income work situation or any tough patches close friends go through.
User avatar
Topic Author
Stef
Posts: 1163
Joined: Thu Oct 10, 2019 10:13 am

Re: Young investors, how do you feel about your 1st market crash?

Post by Stef »

I'm sad that the market isn't on discount anymore. 22% down from the peak doesn't feel like a good price to buy in the current situation.

I hope to see SP500 droping below 2000 by end of May.
settlement12
Posts: 38
Joined: Sun Mar 08, 2020 8:04 pm

Re: Young investors, how do you feel about your 1st market crash?

Post by settlement12 »

Noobvestor wrote: Tue Mar 24, 2020 3:33 pm
settlement12 wrote: Tue Mar 24, 2020 7:12 am
Noobvestor wrote: Mon Mar 23, 2020 8:07 pm
settlement12 wrote: Fri Mar 20, 2020 6:57 am
MotoTrojan wrote: Fri Mar 20, 2020 6:41 am

You got lucky but now I fear for your future.

Imagine you had similar success back in 2000. The year is now 2011 and the financial media is talking non-stop about a bear/crash coming; you decide to stay in cash. When do you get back in? Ever?
Yeah I got lucky. I've already got back in 25% of my total cash on Monday. I'm planning on doing 3x more 25% DCAs, spread over the next few weeks. If it goes down further I'll just be glad that I won't be hit as hard as others, if it goes up well then well and good.
You got lucky, and now you're pushing your luck DCAing back in. Might want to just find an allocation you can buy, hold and rebalance. /2 cents
My AA will be 100% stocks. DCA'ing seems to work well in a recession, otherwise I'd be looking to time the bottom and we all know that's a terrible idea. This way I won't miss the upswing if it happens anytime soon
Markets are up close to 10% today. Was this the bottom? I don't know. But if it was, will you feel comfortable with your decision?

I was in 66% of my nett worth before the markets picked up, so if that was the bottom I'm delighted. However I don't think it will be.

If it falls again, and it's heading that way now, I'll be tempted to put the last 34% in. Otherwise I'll keep a hold of it for a while
Post Reply