More on Staying Put

Here's another piece on why it's a good idea to keep investing during tough economic times:

Those who say "this time it's different" in describing the current financial turmoil could use a reminder that, a mere decade ago, a surprisingly similar situation existed.

A good lesson for investors to bear in mind is that those who kept faith in the markets during the crisis were extremely well rewarded.

The details follow over two pages in the article, but this is the summary.

Here's what I'm doing differently from an investing standpoint given the tough economic times:

Nothing.

Ok, that's not 100% true. I am buying more shares in index funds when I get the chance, but as most of my spare cash is going towards saving for a big downpayment on a new home, I'm not doing much of that. But I do have regular index fund purchases going on as follows:

• 401k contributions
• Taxable accounts (from paycheck to Vanguard)
• IRAs (from converted 401ks) that are taking this year's cash infusion and buying a specific amount each month

So my plan is to stay the course. It may take several years, but I do believe a turn-around will happen. And when it does, I'll be ready to reap the big rewards for sticking with my strategy.

Comments

["Mo" Money]

Stocks are "on sale" now, but most investors don't take advantage of that fact.

[aaktx]

I am also a slow-and-steady index fund investor who has averaged heavily into this market downturn over the past 9 months. I cannot predict when the rebound occurs but I have a very long time horizon and hope this downturn lasts a year or two. I plan on backing the truck up into the VTI if market crashes further.

[Zombie Money]

I agree but it is def painful to look at the losses from this year thus far! :)