It’s been another banner month in the stock market. As I type this, the Dow is down 774 points, the S&P 500 is down 99 points, and the Nasdaq is down 281 points.
I’ve heard it said from different sources that out of every 10 years of the market, the historical average is that 2 of those years will be down and 8 of them will be up.
I have also heard the phrase, it’s not about timing the market, it’s about your time in the market. Meaning, no one can time the market and predict exactly what it will do. What is important is the length of time you are in the market, letting compound interest work in your favor.
If you are going to invest, you have to think long term. Like I said in September, when the market is experiencing volatility and it appears the sky is falling, you really haven’t lost any money…as long as you don’t panic and sell like we did in 2008.
Luckily, I was only allowed withdrawing the money I rolled into my 401k from a previous employer, which was around $4,000. Unluckily, we stopped contributing to what I had from my current employer for nearly a decade and missed out on the majority of the boom.
According to Marcotrends, in 2007, before the crash, the Dow Jones Industrial Average was at 13,178 points. In 2008, it dropped 33.84% to 11,244 points. In the decade that followed, it more than doubled to 25,046 points in 2018. Thanks for the investing advice Alex Jones.
On the plus side, since we started investing again in 2018, the DJIA is up over 9,000 points, so at least we were able to get in on some of the growth.
I’d rather the market not be tanking right now, but at least we can take comfort in knowing that we are buying things lower so that we will reap the benefits when the market starts going back up, which it eventually will.
| Investment | Deposit | Balance | Growth |
| Work 401k | $1,268 | $107,673 | -$3,891 |
| Roth IRAs | $1,000 | $29,536 | -$1,567 |