Down goes the Dow

if markets do ok then you should be fine. If markets dont' do well then you will not be as fine. Hard to be more definite than that. The good news is that 12 years is a good amount of time to get to some kind of median return from markets rather than an outlier like 2022.

Sorry to hear about your job insecurity. A few random thoughts:

- have you got an idea how much you need to spend in retirement? That’s usually a good starting point to figure out what income you need from various sources

- is there enough in retirement savings for the 4% withdrawal to fund your lifestyle? If not, you may need to consider post retirement belt tightening, or else expect to drain your savings quicker than hoped

- if you want to preserve the current value of your nest egg with 4% withdrawals, you can find safe investments paying that or more, currently. Possibly not for to many years if inflation and interest rates start to drop

The 4% rule for drawing down retirement savings is “usually” safe, but can be affected by inflation, size of savings and actual returns on invested savings. You should get some good input from this group, but you might consider consulting with a fee for service financial planner for a closer look. I suggest paying for advice, because “free” advice is always biased and incentivized to the advisor, not you.

How can you know as he said nothing about how much $$ he has in his 401(k)?

He also makes no mention of other savings at all, nor whether he owns a house and how much debt he has.

“The good news is that 12 years is a good amount of time to get to some kind of median return from markets rather than an outlier like 2022.”

Or, perhaps the outlier were the dozen years where $Trillions were pumped into the financial markets where the negative consequences of such foolish behavior could last for more than a decade.

we're talking percents. Taking 5%/year out of a balanced portfolio is sustainable if stocks and bonds return their usual amounts. The actual dollar amounts don't matter.

I suppose we do need to know his allocation in the 401k. if it is all cash or all tech stocks then there might be a problem.

And sure, if anything in the future will change like a balloon payment or changed mortgage rate then the story would change.

My first reaction was similar to Babylon's. Without knowing the bigger picture and ability to weather a sustained downturn, any advice concerning risk is not going to pertain very well to the individual's unique circumstance.

😹not today😹

You don't pay bills with %s. The actual $$ amounts is the only thing that matters

We have no idea about the size of his 401k account, other savings, his debt, whether he owns a home etc.

Big difference between $100k in a 401k and $4 million

Wow. Nothing like bringing the dot.com irrational exuberance into a more personal focus!

I got into investing in the mid-nineties and got into a brokerage that did nothing but offer new IPOs to their clients. It was really cool and I got into probably a couple every week. Most were internet. You had to be watching for the offering at the very second it was released and confirm or your missed out. I got good at it and had some real winners.

The thing is, this brokerage, based in Manhattan, was fronting for the big boys, and they got selective about who they would distribute shares to. My strategy was to buy and hold, not selling, even after the expiration of the lock-down. I could tell that they loved this since I started getting access to IPOs that very few others were getting. We had a message board and traded info, so I eventually figured out this was going on.,

I had some that were moonshots. Internet Capital was one, and there were others, too, But I held on longer than I should for most, and really only starting selling in the crash around 2000., when the brokerage folded, btw.

It was exciting stuff, and from there I developed a preference for market leaders, which has served me well. And there was all the social hub-bub that went with knowing a lot of tech. and entrepreneurs, too. Lots of stories, and some of them are true.

* Lock-up period, not 'lock-down'. (That's a different story.)

we're all sort of talking apples to oranges.

I'm saying on a limited scale, a balanced portfolio should be able to hold its value over 12 years taking 5% out per year. That seemed to me the question the poster was asking.

But sure, I'll agree with everything everyone else says on needing more information to make a wise financial planning decision.

the inflation nowcast keeps dropping its estimate of inflation.

it has month over month CPI December over November at just 0.1%

Which is basically zero inflation.

That is great news. Unless it means a recession is starting. Then it's bad.

But the GDP Nowcast has growth in the 3-4% range for the 4Q and rising.

At some point the Fed has to acknowledge that inflation is dropping quickly. They want to appear tough and credible, but come on. They can't just ignore the data.

As we are talking outliers, maybe for the Hussmann Strategic, 2022 was the outlier and beginning in 2023 it will return to its paltry "earnings" each year as it has had since its inception 23 years ago?

OK, time for a bet Sally. NASDAQ or HSGFX in 2023?

weird that we are having another mini-crash even as the news gets better and better. Down 7% in 2 weeks. I thought after CPI came in so low a couple weeks ago we'd be fine for a while. Wrong. But

inflation is coming down fast

GDP growth is increasing and high

the econoday economic surprise index shows very high positive economic surprises coming across.

the yield curve has been de-inverting to some degree

China is opening.

I guess on the other side, interest rates have been rising again.

I'm chalking this decline up to holiday weeks low volume and computers following each other down the drain.

I am going to have to go with NASDAQ with a big bounceback. You know HSGFX had decent/good annual returns its first seven years of existence, but after 2011 it has been brutal for the fund with 2020 and this year the exceptions.

finance.yahoo.com

Hussman Strategic Growth Fd (HSGFX) Performance History - Yahoo Finance

Current and Historical Performance Performance for Hussman Strategic Growth Fd on Yahoo Finance.

Link:finance.yahoo.com/quote/HSGFX/performa...

HSGFX continues its outlier year with a new high and up 18.11% YTD.😂

Could be it.

The only negative I see of concern is the rise in Covid cases in China and their fiasco of a vaccine program. That could have impacts beyond their borders and on their economy and maybe the broader economy, for that matter.