So here are my latest thoughts...checked asset allocation last night and I have one account (Roth IRA) that is about 60% of my retirements holdings, the other 40% is spread around current job 401K and a couple smaller mutual funds. Thinking I might just keep letting the 40% of smaller accounts ride in the index funds they are in, and pull the big enchilada 60% out of play into cash for awhile (years?) until something significant happens. That way I limit exposure to the inevitable downturn, while also keeping something in play and just riding the market. Of course if I do this, the market will go up another 5% because I suck and never guess right, but meh. The thoughts of having a good chunk of my retirement nest egg out of play right now is very comforting.
Don’t forget tax considerations. I am not a CPA/Wealth Advisor or any of that shit, and don’t know how far you are from retirement, but don’t forget earnings (and distributions) on your Roth are tax free, while the 401k will hit your withdrawals with tax.
Because of that treatment when I look at my entire asset allocation I do full index funds in the Roth (longer time horizon and therefore expected higher returns) and more conservative in the 401k.
Whether this is ideal, I have no idea, but I would think it would make more sense to asset allocate across the different tax treatments you get.
On the note of avoiding the collapse that everyone seems to believe is coming, we pulled almost everything out of equites for the child’s 529 fund. With freshman year 2.5 years away and sophomore 3.5 we made sure to get out of equities for that time horizon.
Probably a smart move. And if you are wrong and have vindicated FOMO on another market run, it's limited to the amount you have in your 509, as opposed to your entire retirement account.
Related thing. I have been thinking about pulling money out of the mutual fund my IRA money is in. Not removing it from the account, just letting it sit as cash for awhile. I know the conventional wisdom is never try to time the market, and I never have before, but I just have this nagging feeling that the other shoe will drop in the next year and we will have a big 20% correction (or whatever) and a few years of choppy markets. Anyone have any thoughts on this?
It's got to happen right? My thought is this, say you have $1mm in that account today and you park it in cash for a year thinking the crash is coming. Let's say the market goes up 10% over that time which means you gave up the opportunity to increase your account by $100k. However, the crash finally comes and the market loses 30%. Well your potential $1.1mm would have been reduced to $770k. But you parked that $ and now it's time to go all in again. Now when the market recovers that 30%, you'll have $1.3mm instead of $1mm. I think the odds of this kind of crash happening in the next year have to be greater than the odds of you losing out on great gains.
Related thing. I have been thinking about pulling money out of the mutual fund my IRA money is in. Not removing it from the account, just letting it sit as cash for awhile. I know the conventional wisdom is never try to time the market, and I never have before, but I just have this nagging feeling that the other shoe will drop in the next year and we will have a big 20% correction (or whatever) and a few years of choppy markets. Anyone have any thoughts on this?
Related thing. I have been thinking about pulling money out of the mutual fund my IRA money is in. Not removing it from the account, just letting it sit as cash for awhile. I know the conventional wisdom is never try to time the market, and I never have before, but I just have this nagging feeling that the other shoe will drop in the next year and we will have a big 20% correction (or whatever) and a few years of choppy markets. Anyone have any thoughts on this?
It's got to happen right? My thought is this, say you have $1mm in that account today and you park it in cash for a year thinking the crash is coming. Let's say the market goes up 10% over that time which means you gave up the opportunity to increase your account by $100k. However, the crash finally comes and the market loses 30%. Well your potential $1.1mm would have been reduced to $770k. But you parked that $ and now it's time to go all in again. Now when the market recovers that 30%, you'll have $1.3mm instead of $1mm. I think the odds of this kind of crash happening in the next year have to be greater than the odds of you losing out on great gains.
This is almost exactly my thought process. Yeah, I have FOMO of losing some gain. My fear of taking a 30% haircut > than my FOMO of lost gain. At least, I think it is.
Related thing. I have been thinking about pulling money out of the mutual fund my IRA money is in. Not removing it from the account, just letting it sit as cash for awhile. I know the conventional wisdom is never try to time the market, and I never have before, but I just have this nagging feeling that the other shoe will drop in the next year and we will have a big 20% correction (or whatever) and a few years of choppy markets. Anyone have any thoughts on this?
It's got to happen right? My thought is this, say you have $1mm in that account today and you park it in cash for a year thinking the crash is coming. Let's say the market goes up 10% over that time which means you gave up the opportunity to increase your account by $100k. However, the crash finally comes and the market loses 30%. Well your potential $1.1mm would have been reduced to $770k. But you parked that $ and now it's time to go all in again. Now when the market recovers that 30%, you'll have $1.3mm instead of $1mm. I think the odds of this kind of crash happening in the next year have to be greater than the odds of you losing out on great gains.
This is kind of where I'm at. Just hard to know when to pull out (lulz).
Related thing. I have been thinking about pulling money out of the mutual fund my IRA money is in. Not removing it from the account, just letting it sit as cash for awhile. I know the conventional wisdom is never try to time the market, and I never have before, but I just have this nagging feeling that the other shoe will drop in the next year and we will have a big 20% correction (or whatever) and a few years of choppy markets. Anyone have any thoughts on this?
It's got to happen right? My thought is this, say you have $1mm in that account today and you park it in cash for a year thinking the crash is coming. Let's say the market goes up 10% over that time which means you gave up the opportunity to increase your account by $100k. However, the crash finally comes and the market loses 30%. Well your potential $1.1mm would have been reduced to $770k. But you parked that $ and now it's time to go all in again. Now when the market recovers that 30%, you'll have $1.3mm instead of $1mm. I think the odds of this kind of crash happening in the next year have to be greater than the odds of you losing out on great gains.
This is kind of where I'm at. Just hard to know when to pull out (lulz).
Related thing. I have been thinking about pulling money out of the mutual fund my IRA money is in. Not removing it from the account, just letting it sit as cash for awhile. I know the conventional wisdom is never try to time the market, and I never have before, but I just have this nagging feeling that the other shoe will drop in the next year and we will have a big 20% correction (or whatever) and a few years of choppy markets. Anyone have any thoughts on this?
It's got to happen right? My thought is this, say you have $1mm in that account today and you park it in cash for a year thinking the crash is coming. Let's say the market goes up 10% over that time which means you gave up the opportunity to increase your account by $100k. However, the crash finally comes and the market loses 30%. Well your potential $1.1mm would have been reduced to $770k. But you parked that $ and now it's time to go all in again. Now when the market recovers that 30%, you'll have $1.3mm instead of $1mm. I think the odds of this kind of crash happening in the next year have to be greater than the odds of you losing out on great gains.
This is kind of where I'm at. Just hard to know when to pull out (lulz).
That was obvious when your squaw had a pappoose
Squaw my ass. @Swaye went full reverse Dances with Wolves and married whitey. It is why Spirit Horse no longer shares a trail with @Swaye .
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The question I would ask is what would it take for that not to actually happen?