Here we are again, where in one day the market boom broke new records. Your Survival Guy’s been through plenty of records to know what it feels like to take on live fire in the heat of battle.
Everyone’s a bull in an upward-moving market, but when it swings the other way and enters a correction, and then a bear market, the flight to safety feeds upon itself. As you know, it pays to be prepared well before the storm, knowing how bad it can feel stuck in the market fog.
Remember, the pain from the bust far outweighs the euphoria from the boom. Investors become too comfortable with their newfound wealth in the boom times and expect markets to continue up. But the market doesn’t care about what dollar value a retiree needs to reach to make his dreams come true. Markets are ruthless. Understanding that takes some wisdom, some hard knocks, and knowledge of human nature.
In retirement life, time has a way of becoming a rare commodity. As we get older, it’s best to invest with that in mind. You don’t have the time you used to have, and you can’t work the hours that were already worked. Work to make money. Invest to keep it. Simple, yet sophisticated.
Don’t try to time the market because you just might end up being wrong. Yesterday the S&P 500 closed up 9.52%, tying it with the 7th highest single day return in 97 years, going back to 1928 and the predecessor series to the S&P 500 (the 500 index as investors know it today began in 1957) even before Standard Statistics Bureau merged with Poor’s Publishing (the other 9.52% return happened on April 20, 1933). It was the third best day of the 21st century. The six days that had better performance:
- 3/15/1933 16.60959%
- 10/30/1929 12.53059%
- 9/5/1939 11.85841%
- 9/21/1932 11.81102%
- 10/13/2008 11.58004%
- 10/28/2008 10.789%
Action Line: When you want to talk about building a plan for your portfolio, email me at ejsmith@yoursurvivalguy.com. And click here to subscribe to my free monthly Survive & Thrive letter. My most recent letter talks about bonds, when to buy and sell, and gold miners.
Originally posted on Your Survival Guy.
