The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: Annie101 on March 24, 2020, 08:31:19 PM
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We have been saving for a travel sabbatical for 8 years now, to be used in 2 years, and we left a good chunk of it (half) in the stock market. I know, so dumb. We just lost $16k. What to do now? Sell what’s left or hope it doesn’t go down further in the next two years??
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put the other half in the market?
Do you think it'll take more than a year for this market to claw back more than 50% of it's losses?
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put the other half in the market?
Do you think it'll take more than a year for this market to claw back more than 50% of it's losses?
AGREED!! I definitely wouldn't take what's left out but given it's for a trip that's still far out I'd dump the rest or a portion into the market. Of course that depends on how risk averse you are
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Having a portion of your sabbatical funds in the market wasn't a dumb move. It's a ten year period, which is a substantial amount of time.
Given that you're tempted to pull out now, I definitely would NOT put the other half in, but I also wouldn't lock in the losses and pull out.
Instead make a plan to transition to a short term AA over the next couple of years. Like for instance at sabbatical minus 12 months, S-12, sell 1/12 of your stock holdings every month. You could go to low duration bonds or a CD ladder.
Worst case scenario you just delay the sabbatical or find ways to save even more! First world problem for sure. :D