Our Hopes And Expectations

“Be careful what you wish for” goes the saying.

For the last few years, I’ve been wishing that the stock markets would crash so that I could take advantage and invest in lower priced stocks during my accumulation phase.

What’s happened isn’t quite what I had in mind.

In fact, I can’t really say what it was that I had in mind – just not this!

I wasn’t an investor during the financial crisis of 2008, I’m no grizzled investor who’s been round the block, so this is all new to me.

So the time is now. Or is it? As mentioned in my last post, I’ve made the decision to just stick with my plan, which is to not sell and to continue investing on a monthly basis, in accordance with my asset allocations.

Tempting though it is, I’m not going to dip into my emergency cash reserves to invest, especially as I have big dental costs this year, never mind the other (as yet) unknown expenses likely to occur.

Whatever I invest in now is effectively on sale, whether the price is rock bottom (it probably isn’t) or not.

Black Holes and Revelations

I was going to avoid looking at my portfolio until when I did my usual month end update but curiosity got the better of me. I ended up having a bit of a peek and now I wish I hadn’t!

It was a couple of days ago and I’ve lost at least a year of gains, around 22% or £34k. The markets have dropped more since, so I fully expect to be reporting a further decrease in my Future Fund at the end of the month – YIKES! 🙁

This could massively set me back in my FIRE plans, although there’s the hope that if the markets recover back to their dizzy heights in a rapid fashion, I might get back on track. Not really going to hold my breath though.

We could be in a depressed state of recession for a while. The global economy will probably get worse before it gets better and who knows how long it will take to recover, if at all.

There could well be an impact on my job – will the company need to lay off people?

I could end up getting ill, or rather, I probably will get ill (as part of the herd immunity strategy our government has adopted) – let’s hope I don’t suffer too much and can recover.

I need to brace myself in case there are shocks around the corner but until I know what is actually going to happen, I will carry on as normal.

Starlight

For something less gloomy, how’s about a bit of FIRE dating?

This beta dating website for single FIRE folks was brought to my attention via Money for the Modern Girl .

I have a feeling that there are going to be mostly young folks on here and not many in my age group, but if past relationships are anything to go by, that shouldn’t be too much of an issue! 😉

Beyond filling in bits of my profile, I’ve not really spent any time on this, so not had a good look around yet properly or connected with anyone.

However, with no sport, no or limited matched betting and no real social outings,  I have no excuse for lack of time, haha!

Hope everyone is keeping themselves and their loved ones safe, keeping calm and washing their hands.

Next post will be my month end figures – it’ll be a bloodbath!

40 thoughts on “Our Hopes And Expectations

  1. Yes, quite the most dramatic week I have seen. I can’t remember the FTSE dropping by over 10% in a single day before!

    Lets hope this is as bad as it gets and the markets can recover over the next few months.

    I will do a portfolio review at the end of this month but I’m currently down around 6% and glad I moved out of the oil sector last year which seems to have been particularly affected due to the oil price drop. I’m not sure they will recover from this given the sentiment against fossil fuels around the globe as it makes plans for net zero emissions.

    Really hope the situation doesn’t affect your job!

    • Hi Diy

      Well, the FTSE’s dropped again and I think it’ll probably continue to drop a while longer.

      Just a 6% drop is brilliant, well done for having such a diversified portfolio but as you say, you’ve really dodged the bullet getting out of the oil sector.

      The oil business and issues with travelling could have an impact on my job too, so fingers crossed we can continue doggedly!

  2. I wouldn’t be surprised if we saw a 50% drop, but then I wouldn’t be surprised if it came right back to where it was. This should be over in a couple of months and the pent up demand might recover most of the current dampened consumption and production. Plus, while Europe is getting hammered it may not happen that way in the US which has a much lower population density. Or it might be worse here with our private medical system. My portfolio was down $500K, but has recovered to minus $430K. Either way I bet we won’t even remember much of this in three years.

  3. These are not normal times but recommend reading ‘The Tao of Warren Buffett’.
    My own strategy is if a stock falls 25% either sell or buy more.

      • the 3 stocks (Pan African Resources – gold miner, H&T – Pawnbroker ,Tremor Int – advertising) I;ve bought more of after they have fallen 25% have kept falling – ouch!

  4. Back in 2008 i liquidated my pension pot just before the crash, saved myself about 30% in the process, and for circa 18 months i was very pleased with myself. The trouble was though i never did reinvest that lump and subsequently lost out in the eventual recovery.
    It’s very tough sitting on your hands and watching your investment portfolio go into free fall, but that’s what I’m doing this time, albeit from as far away from a computer as i can. I estimate my equities are currently down around 30%.
    If someone could guarantee that in 5 years time the market will be back level again, i think right now i would take that.

    • Hi KC
      I think I’ve managed to sort of detach myself and think ‘it’s just numbers on a spreadsheet’. I think that’s how I’ve been able to not panic and stop msyelf from checking obsessively and worrying about whether it will ever recover. I would absolutely take it if it were guaranteed to recover in 5 years’ time!

  5. I’ve been a quiet reader of this blog for quite awhile and I’m in pretty much the same boat!

    I know it is very concerning to see the value of investments decrease at such a rapid pace but the best advise I would give is to stop checking the markets for now and hang in there!

    All the best
    Adam

  6. Who knew that in March 2020 I would wish we were all still just “discussing” Brexit!!! I have chosen to just ignore my investments and not look at them, I am trying to keep calm and just keep going. I have lived long enough to know that with all things, it will pass and some sort of normality will return. Wash those hands and look out for each other.

    Good luck with the dating profile!

    • Hi SYBN
      I never thought I’d wish the news was just full of Brexit right now – those were the days, eh!
      Yes, all this will pass and hopefully, we will come out of the other side safely.

      Thanks for the wishes re dating – still not done anything to progress yet!

  7. I’ve been hand-washing enthusiastically with the result that I now have a nasty rash on the back of my left hand. I think I’ll return to washing my palms: they’re the parts that hold things.

    Investing: we’ve been principally in cash and PMs for ages because I expected a great crash. If equities fall much further we mighty put a tentative toe in the water. My experience of successful market timing has been with selling: trying to time buying is new for me.

    • Hi dearieme

      I suffer from eczema and it’s flared up on my hands but needs must right now and the foreseeable future.

      So have you dipped a tentative toe into the water?

      • Not yet. The Younger Generation in the family are keen to try equity investing: for the moment I’ll leave it to them. But we have contributed a bit more to pensions so that there’s tax sheltered cash that will be available eventually.

        Anyhoo, look after yourself, lass.

  8. HI Weenie, I’m a bit further down the investment track than you, and I’m determined to sit tight and ride this one out as I did in the dot com crash and in 2008. It’s a proper cold shower though. However, after listening to an excellent podcast from Mad Fientist with Jim Collins, I think that when it all gets back to normal I’m going to look hard at my asset allocation. After all, although I can probably wait for five years for this to sort itself out, I don’t think I can do with the stress of having so much money in a Vanguard 80/20 fund as I head into my sixties 🙂

    • Hi Jim
      Despite the big ‘paper loss’, I think I’m still fairly comfortable with my allocation. Have a fair amount in VLS 80 myself and hope that will do the Nike swoosh that they’re talking about when I come to rely on it!

  9. It is depressing; ISA had a 5% loss, pension 8%. I just paid in my end-of-year pension contribution, and it did feel very counter-intuitive to put money into something that’s already losing it, but I did it (and the pension’s gone up slightly since yesterday!). I’ve decided to do the same as one of the posters above – stop looking! Hope for the best and prepare for the worst is all we can do. I am quite pleased I liquidated one of my ISAs only about a week before the virus though – planning to get a new kitchen this year, so I locked in the quite nice profit I’d made. Pure dumb luck though!

    • Hi Tina

      Good to hear that you pocketed some profit for your kitchen before the world fell out of the stockmarket’s bottom!

      I’ve read some ‘experts’ say not to invest as the markets having stopped falling. But I’ve been investing as the markets have been going up over the years so now I’m investing while the markets are going down, which actually makes more sense, but feels a lot scarier!

  10. I will actually be dipping into my emergency fund at some point but limiting myself to 20% of it. The benefits of holding a slightly larger emergency fund than recommended I suppose.
    As for the FIRE dating app…I had no idea that existed haha!

  11. I’m nursing about a 12.5% loss right now which isn’t great but I was quite heavily in equities until recently… On the upside the company I work for just paid my bonus entirely into my pension which will hopefully look very good in the coming years! 🙂

    It’s fortunate the FIRE community tends to have more savings on hand than the average UK’er – cos things may get pretty grim in the coming months if the job losses are anything like the US.

    • Hi Xailter
      That’s great news on your bonus – am sure it will look great in years to come!

      I wouldn’t say that my job was 100% secure and would hope that if it came down to it, the company asks the government for help in paying the 80% of pay as promised.

      I am so glad that I have an emergency fund.

  12. I thought briefly about investing some of my spare cash into shares, but I decided not to, it felt too much like trying to time the market. I’m glad I didn’t now as the prices kept falling!

    I’d be quite happy to see a little good news now, things have fallen far enough for my sensitive disposition!

    • Hi Baldrick

      I switch off to all news and articles during the day as don’t want it in my face more than necessary. Unless they are funny memes!

      I wouldn’t be comfortable using some of my spare cash to buy in now, although I will be rebalancing as my bond allocation is now higher than planned (doing what they’re supposed to be doing) so I may sell some bonds and top up equities.

  13. Naughty market timer that I am, I’m in the process of arranging a small mortgage of £25k on my home so as to invest it. Small enough that I can afford for the gamble not to pay off, but big enough that it’ll hurt if it doesn’t.

    I figure the few extra weeks it’s likely to take to get the funds in place (I’d be waiting for the FY20/21 ISA allowance anyway, so not much beyond that) will either mean I miss out on a key bit of the recovery or – more likely – will save me from myself whilst the market continues to go down.

    If I had to put my finger on why this isn’t the crash I’d been hoping for, it’s because the causes feel too legitimate and linked to the real economy. There’s a difference between liquidity issues or general financial shenenigans, and real businesses shutting up shop for extended periods of time.

    • Ooh, interesting! It certainly is a risk but a calculated one. What are you investing in, if I may ask?

      It will be interesting to see which businesses survive in the aftermath of lock down and then the oncoming recession. Some of them will change and adapt. Some will just die unless bailed out by the government.
      This is when I’m happy to have most of my investments in trackers – the fallout from individual companies should have less impact.

  14. Pingback: The Full English Accompaniment – Is COVID-19 the crisis to heal Brexit divisions? – The FIRE Shrink

  15. It’s been a tough month, hasn’t it! I’m hoping for a sharp ‘V’ recovery as some commentators are talking about, but prepared to deal with it either way. I’m not too ashamed to say that I’m drip feeding into my ISA, and that some of this is emergency funds at this point. We’ve seen a significant discount… I’m not dumping it all in, but gradually my plan is to take as much advantage as I can of the lower prices.

    • Hi AO

      They’re predicting a Nike Swoosh, rather than a V – at least that’s still heading in the right direction but how long will the Swoosh be? 5 years? 10?
      Drip feeding seems less risky as markets are still falling – good luck with your purchases!

  16. So much going on now with the coronavirus pandemic – though this end I’m just going to keep calm and carry on! Hopefully this pandemic doesn’t lead to another recession!

  17. Great to hear your thoughts Weenie. It is weird how we’re all rooting for a crash but when it comes it’s not how we wanted things to go at all. Shows up how unclearly we all think about these things… for a crash to happen some bad sh!t has obviously to hit the fan so what exactly were we expecting!?

    I’ve dumped 20k into my ISA but have held off utilising Mrs T’s ISA allowance. I need some sort of normality to return and see some income again before I want to use any more of our (still fairly considerable, compared to most) emergency fund up, because it’s not just an emergency fund now it’s a “living” fund haha. You can’t eat stocks and shares 🙂

    If in the new tax year prices are still low but sports gambling starts up (or even if looks like we get a solid date it will start again) I will probably steam in with at least 1 more full ISA allowance top up.

    Who knows what the future holds though!?

    Take care 🙂

    • Hey TFS

      Yes, in wishing for a crash, I admit that I was somewhat naive in not really considering the implications of what would cause such a big crash – not thinking of the bigger picture of course.

      Good luck with your investments but you’ve done the right thing, in light of your current situation and the non-existent opportunities for sports betting, it makes sense to keep a wedge aside for living costs/emergencies.

      Take care yourself 🙂

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