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Lobster_osity OP t1_iy4bape wrote

Reply to comment by shadow_chance in Started saving for retirement this year-- my "historical returns" YTD say -8.97%, why am I putting this money here instead of a high yield savings account? by Lobster_osity

OK. It's a little unnerving investing in decades. What if when I retire the market is shit?

I am guessing the answer is that in the meantime, there will have been enough gains that even if that happens it will still have been worth it. I am in my early 30's.

Thank you!

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Anonymous_B-I-G t1_iy4fbra wrote

This is another reason that target date funds are helpful. They automatically shift allocations to less risky assets as you near the titular year. Set it and forget it.

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Random_user_name_3 t1_iy4bnyv wrote

A shit market 35 years from now will be better than the highest peak we’ve experienced so far.

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nolesrule t1_iy4c5vf wrote

> What if when I retire the market is shit?

You might still have a lot more in your account than what you contributed over the next 20-30 years.

If the market doubles every 10 years for 30 years and then you lose 50% a year later, you're still ahead 4x. That's better than a savings account in the long run.

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-NoLongerValid- t1_iy4cgkz wrote

> What if when I retire the market is shit? > >

With any luck you'll have 15-30+ years after your retirement date to recover some of those losses. And, it will probably be wise to lower your exposure to the stock market as you get close to your target retirement date.

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Lobster_osity OP t1_iy4cxpq wrote

Right, that makes sense. I guess I didn't really think about the fact that you don't cash it out all at once when you retire. Thank you for the perspective!

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shadow_chance t1_iy5at7b wrote

As you get closer to retirement, you shift your asset allocation away (not completely) from stocks and more towards bonds/fixed income/etc. You also don't withdraw your whole account at once. Most of your money stays invested.

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darkchocolateonly t1_iy4cjue wrote

If you have enough saved you can retire in a downturn and weather it fine. It just takes good planning

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Lobster_osity OP t1_iy4cz34 wrote

I said in another comment that I didn't really think about the fact that you don't cash it out all at once when you retire. Thank you for the perspective!

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