The global stock market is in freefall, a few companies are closing down, and real estate is at 5-year lows. I’m buying.
Look, here’s my opinion. If you have a cash reserve, if you spend less than you make, and you invest at regular intervals in a wide variety of investment choices, in time you will do well. I’ll be honest, and the proof is in my NetworthIQ link on the left margin, my portfolio value has gone down just like yours. It’ll probably go lower. But I’m buying a lot more shares at this level than I was last October, and I’m confident that by 2026 (my 60th year) the market will be much higher than it is today.
You know what, though, my portfolio will be a lot different in 2026 than it is today. My favorite portfolio management ideas come from Ray Lucia. If you were in retirement now and you followed Mr. Lucia’s “Buckets of Money” strategy, you’d be yawning now instead of staying up nights. Why? Because Mr. Lucia would have you in 7-years of risk free cash, 7-years of low-to-moderate risk investments, and the remainder of you nest egg in a diversified stock portfolio.
My plan is to begin to transition to the income buckets beginning 7 years prior to my 60th birthday. I’ll start filling my first bucket then, and investing less in my third bucket. I’ll also begin filling my second bucket from my portfolio. I’ll dollar cost average out of the stock market and into REITs and fixed investment options.
Throughout this period, I’ll continue to live within my means, avoid personal debt, and live my life. I’ll spend time with my wife and my sons, travel, work in jobs that give me a chance to learn new things and gain new experiences.
I’ll also be drawing my military pension, enjoying the benefits that military retirees have access to for life, and have the confidence that despite market fluctuations, I will prosper over time.
I wish you peace and hope.