The "black swan" and retirement planning. (vacations, dump, depression)
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I've made it through several financial downturns in my life. Black Monday in 1987, the dot-com bust at the turn of the century, the 9-11 downturn in 2001 and the Great Recession. Made it through all of them to retirement by taking a deep breath and trying to assess the situation with as much logic as possible. One thing I always try to do especially is tune out the babble from all the "experts". Most of it is not helpful and only confusing to the average person.
Currently I've structured our holdings to be able to absorb a financial downturn lasting several years before having to start selling the stock portion. Now as far as the meteor/pandemic/solar flare type of events, I honestly feel that there isn't much I can do about them and the odds are pretty long of them happening, so I don't worry about them.
I am amazed at the responses on this forum. If this had been posted on the Economics forum, there would have been an endless number of responses from the gloom and doomers and the lunatic fringe preppers. It could be partly the age of the forum participants, but most of us at or in retirement are highly concerned about preserving assets.
I am not sure there is any one thing one can do to guarantee they cannot be bit in the a$$ by the economy. My answer has always been invest in solid, diversified mutual funds, hold some blue chip stock, and let it ride.
Read through most of this thread and would tend to agree that, as George Harrison put it, "all things must pass". Granted that, I do give a bit more thought to the effects of man-made crisis' (not much to do about a meteor after all) than I used to when I was working. Personal solution has been to keep 1.5-2 years worth of baseline expenses in a savings acct to cover what doesn't come from SS and annuity income streams.
I am amazed at the responses on this forum. If this had been posted on the Economics forum, there would have been an endless number of responses from the gloom and doomers and the lunatic fringe preppers. It could be partly the age of the forum participants, but most of us at or in retirement are highly concerned about preserving assets.
I agree that the participants on this forum are more level handed and have more common sense than some of the other forums. That's one reason why you see posts on the Retirement forum that may seem out of place. Who wants to go to Renting, Personal Finance, Work and Employment, etc. to get advice when there are such oddball answers and answers that have little application to seniors? But younger people are right to be concerned about black swan events. Social Security may be less solid for them and not as many will have pensions to fall back on. But yes, they have also been watching too many zombie movies.
I agree that the participants on this forum are more level handed and have more common sense than some of the other forums. That's one reason why you see posts on the Retirement forum that may seem out of place. Who wants to go to Renting, Personal Finance, Work and Employment, etc. to get advice when there are such oddball answers and answers that have little application to seniors? But younger people are right to be concerned about black swan events. Social Security may be less solid for them and not as many will have pensions to fall back on. But yes, they have also been watching too many zombie movies.
Of course there is a horror movie aura about it. Many black swan events are very frightening. Things can be disrupted for a good while, on the financial front or others. It's not peasant to think about, but possibilities need to be considered and addressed as best as we reasonably can.
I agree that the participants on this forum are more level handed and have more common sense than some of the other forums. That's one reason why you see posts on the Retirement forum that may seem out of place. Who wants to go to Renting, Personal Finance, Work and Employment, etc. to get advice when there are such oddball answers and answers that have little application to seniors? But younger people are right to be concerned about black swan events. Social Security may be less solid for them and not as many will have pensions to fall back on. But yes, they have also been watching too many zombie movies.
Also, because we are older, there are more people here like myself who experienced the dreaded black swan ordeals and lived to tell the tale.
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