Oops! That is what I have been warming about in recent columns — when I noted that the three things needed to deal with a bear market are: Danger (an assessment of how low the market could go); Duration (how long the market might stay low) and DISCIPLINE (the ability to stick to your plan)!!!
That’s why I always advise having some chicken money in the bank so you can sleep at night and NOT PANIC!!
(I’ve been doing this a long time and recognize that panic is a very real emotion — and it gets worse as you get older and have more at stake, like your entire retirement!)
I don’t know what to tell you right now. Honestly, I don’t. If you get back in as of this writing, you’ve “missed” maybe 1,000 points on the Dow. Given your stage of life and your tendency to panic, I might move 20% back in– and then another 5% on the 1st of every month, till you are 50% back in the market. That way, you’ll never buy the highs, and never buy the lows!
I suspect the market might go lower in the next year, but you do need some exposure to stocks to offset inflation down the road. If that sounds like “hedged” advice — you’re right. That’s the way I approach the market. Then I’m never completely happy, or unhappy at the end of the day. And I’m never tempted to make a move out of emotion.