If you think you might "change your plan" based on losses, then you need to study more about the type of plan your building.During accumulation, it would not be unusual for someone to shrug off a 50% decline. With decades to go and a steady paycheck, that decline is just a bump in the road. When you are retired, you will no longer that that paycheck. I am curious, how much portfolio loss can you stand. What about the kind of portfolio loss. What if you have a single drop like in 2008, or several years loss like in 2000-2003? What have you setup to mitigate these situations?
To clarify it is how much loss you take before you change your plan. 3 years of losses in dot comm bubble + 2008 would drop you to about $600k. This would be a lot to take for the first decade of retirement with a balance fund type portfolio. Would you start changing your withdraws and try to head off a possible disaster? When would you feel that you would feel you might run out of money before you die?
In other words, your plan should stipulate that you DON'T have to change your plan in any market outcome!
Sorry if my response was not detailed enough, however, I think it was as detailed as your question.
Statistics: Posted by retireIn2020 — Mon Jun 10, 2024 1:56 am — Replies 41 — Views 3368