Ten Ways to Run Out of Money Part 3

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May 28, 2020

I’m pretty sure this one is directly related to the first issue, life expectancy. And the assumption that there is no way you will live to see the market recover from a downturn or a crash. This is more of the assumption that the present moment is all there is. Things won’t change from “this”, whatever “this” is.

So, here are some numbers in a nice chart:

The average Bear market lasts about 3 years, 3.1. Can it be worse than that? Yes. A plan that includes a clear view of expenses and assets can make the ride much smoother. If you had a cash bucket or war chest or savings account with three years of living expenses, the average Bear wouldn’t change a thing. I count 28 Bear markets in that graph. Only 7 were over 4 years. I’m not saying that a Financial Plan is going to make the scary sight of 1973 on that chart go away. I will say that having a plan helps. Having “done the work” helps.

Let me know if any of this resonates.

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