Is There Light at the End of This Tunnel?http://www.fool.com/personal-finance/retirement/2008/12/23/is-there-light-at-the-end-of-this-tunnel.aspx Hope Nelson-Pope (TMF Lucky11)
December 23, 2008
My colleagues told me not to do it, but I went and did it anyway.
It was mid-October when I worked up the nerve to peek into my portfolio and check the damage. My colleagues could only say "I told you so" when, after facing a sea of red, I let out an audible gasp and closed the Web page, trying to forget what I'd just seen.
It's ugly out there; we all know that. It's especially ugly for the many people who were hoping that this would be the year they'd begin their golden years of retirement, only to watch their savings dissolve.
To them, I say: I'm with you
It's a small consolation to hear phrases like "prime buying opportunity" and "lock in now for long-term gains." You're already nearing, or even in, retirement, and much of your savings has already gone down the drain. You're not looking for prime buying opportunities; you just want to preserve what's left. What do you do now?
It's easy to panic. Don't.
But what does that mean in action-oriented terms? In a nutshell, Swedroe says, if you sell everything now and try to convert what's left to cash, you're making those losses permanent. What you should do instead, even though the short-term pain may be intense, is stay on course with your plan -- or if you have no plan, sit down today to develop one. Now is no time for panic:
And now, an illustration