6 Ways You’re Coping With a Roller-Coaster Market

It measures the health of the economy as a whole with some large numbers. Interest rates were raised by the Federal Reserve Board on Wednesday by three-quarters. Gross domestic product we learned on Thursday fell for the second straight quarter. And the stock market has been bouncing around for months. But for those who are working on or dreaming of retirement, one of the most important numbers is close to home. It’s my own retirement savings. And the variability of the big picture numbers is, of course, related to the individual plans.

The New York Times wanted to know how this uncertain moment affected you and how you managed your retirement savings and investments.

Hundreds of people around the world have answered our questions. Some readers asked specific questions, such as when to receive social security. But other people like these six provided a broader view of their personal situation and how they were trying to find equality.

The moment when many feel a disconnect between macros and individuals — recent polls show that even though some see stability in their lives, among voters about the economy Showed general malaise — the experience of these readers shows that there are different ways to deal with it.

It’s only now that Michael Lewis has realized the value of having Vanguard founder John C. Bogle as a high school graduation speaker. At the time, Bogle’s everyday influential investment advice for Americans didn’t make much sense to teenage Lewis, who is now working as a director of marketing research at a tech company. But now, following the example of his grandfather and his mother, he is an avid Vanguard investor.

“I didn’t appreciate it until after the fact,” said Lewis, 41, from Berkeley, California. “It didn’t really sink until I graduated from college and started investing with them.”

Recent market uncertainties haven’t upset him like the 2008 crisis. He is at a loss to sell a mutual fund and remembers the mistake he made last time.

“Basically, what it said to me was’do nothing’,” he said. “In fact, I know myself, so I’m not going to retire right away, so I see this as an opportunity to buy cheaper.”

Lewis also avoids watching his retirement investment very carefully, other than looking “at a very high level” to make sure the account is in line with market performance and free of fraud. I am careful.

“I think it will eventually go up,” he said, adding that the retirement funds for him and his husband are primarily invested in index funds.

Mr. Lewis expects his retirement to look different from the retirement of his parents and grandparents. He considers himself working as a consultant throughout the 70’s. “Think about it. You’re like being at the pinnacle of your knowledge in your career, and it just stops,” he said.

As an only child, he regularly discusses investments with his mother. “I have benefited from starting to acquire some financial literacy,” he said. “And there are people who ask questions and bounce ideas back.”

“I don’t want to gamble”

For Stephen Shaw, retirement does not mean quitting his job. Instead, he believes that retirement will allow him to choose the projects he wants to work on most and will be fulfilling.

“I want to be in a place where I don’t have to compromise on what I do and with whom I work,” Shaw said. “And I’m really close to that.”

However, Mr. Shaw, who lives in Munich and runs his own philanthropic consulting business, has calculated the minimum savings he and his wife must maintain to thwart the plan. And recent market volatility has put Mr. Shaw very careful about balance. He performs weekly calculations to rebalance his portfolio, allowing him and his wife to maintain their current standard of living even if stock prices fall by another 50%. He describes this as making sure they are still “green” — if not, they cut their costs.

“In fact, when the pandemic happened, I was approaching this limit with this 50 percent rule,” he said. “It didn’t look good.” At that time, his portfolio held a 60% stake. When the market recovered, Mr. Shaw reassigned a 50% weight on his stake.

“I know I’m leaving some possibilities out there, but I’d rather be on the safe side,” he said. “I don’t want to gamble.” (He said he would eventually get some income from a government-run pension, but “it wouldn’t be substantive.”)

From his previous work experience, such as consulting and art advice, Mr. Shaw was convinced that he was living on both a fat salary and a lean salary, and he and his wife readjusted as needed. He said he was convinced he could.

“I know there’s a way to deal with my financial blow,” he said.

“I’m just holding my nose and working.”

Dr. Melissa Yuan-Innes strongly believes in the movement known as FIRE — financial independence, early retirement. A doctor in an emergency room in her 40s living in the suburbs of Ottawa, she manages unpredictability by working more time or at less cost.

Her time in the hospital has fluctuated over the past few years and is now an arrangement that will help her two children, 16 and 11 years old, to take care of her and build another career as a medical thriller writer. A FIRE approach that involves maintaining modest habits and sucking up as much cash as possible means that she and her husband, an engineer, can maintain their lifestyle. Currently she works 10 to 20 hours a week in ER, but she will take more time if needed.

“I had to rely on myself,” said Dr. Yuan-Innes. “I’m just holding my nose and working.”

Knowing that she can get more work helps her stay away from the market transformation, she said.

“I ignore them,” she said. “If you need more money, you just make more money. I don’t. Sadly, it’s not as difficult as the person paying the minimum wage.”

She added: “I feel lucky. Sitting and looking at the portfolio is just a matter of playing with my head.” Still, Dr. Yuan Innes saw the value of their bonds depreciate and decided to sell them later. Will consider.

She enthusiastically acknowledges her career. “I recognize my privilege of having parents and grandparents who worked very hard in front of me,” said Dr. Yuan-Innes. “Many types of financial independence are that they are completely self-made and unaware of the benefits they have gained from the sacrifice of their white privilege, gender, middle class status, education, government, or their relatives. teach.”

“We’re lucky to get enough money to cover what’s going out,” she said.

“We have short memories”

Lifelong news addict Leslie Westbrook clicked on TV when the stock market plunged this spring and everything she saw was red.

She said it was stressful to see her crawling on her screen. “I feel like your blood pressure will continue,” said Westbrook, 69, Carpinteria, California. Method. “

Westbrook’s grandmother played a major role in arousing interest in investment. Her grandmother worked as an accountant in the wholesale agricultural industry in Los Angeles, investing her own money and urging her family to think long-term about their finances. And then there was Grandma’s Christmas gift to young Leslie: paper stock certificates for companies like Ford Motor Company and Safeway. Westbrook sold those childhood stocks long ago, but her financial lessons endured, she said. She has an advisor who manages her retirement account, but she says she enjoys trading small IRAs inherited from her friends.

“I think of the stock market as legitimate gambling,” she said.

In terms of income, Westbrook relies on a combination of social security, income from her work as a freelance travel writer, and gig as an auction liaison. Because of her work, she leveraged her artistic and antique background to consign special items for major auction houses. She reduced her sales. She is also a volunteer and helps organize murals to honor the Latin community in her town.

“I’m a baby boomer, so I’m thinking,’How do you retire?'” She said. “And if I knew when I would die, it would be much better.”

“We still have dividends”

Steve Adams, 65, wants to retire from a software company working near Charlotte, North Carolina in a few years and join his already retired wife, Jeanette Wilson, 70. But in the midst of stock market volatility, his full-time employment gives them the opportunity to invest in breathing room and depression.

“The market has grown tremendously over the last few years and needs to be pulled back for self-correction,” Adams said. “It offers a pretty good buying opportunity.”

This ability to see the big picture was hard to come by. Adams said he was “hit” during the 2008 financial crisis, which prompted him to work with a financial adviser. He said the adviser led them towards dividend-generating stocks, and over the past 14 years, they designed a portfolio with dividends to cover their retirement living expenses.

“We saw a decline in the value of our stock, but we still have dividends,” Adams said.

They also planned ahead of Janet’s retirement and paid off their home mortgage a few years ago.

“It’s great because you have a safety net in your hand basket if everything goes to hell. As long as the real estate market is strong, you can always do things like reverse mortgages,” he said.

Adams is also fascinated by knowing that his company is healthy. So far, he said, he hasn’t seen a slowdown in earnings as in 2008.

“The goal is to get enough money a month if you can retire at the age of 67,” he said. “I miss some big salaries, but that’s what it is-that is, I can die in two years. I want to spend some time traveling.”

Covid turned over the work of Irvine Schoenfeld in 2020. He got the disease in March of that year, and three people near him died that spring. That guts punch influenced him to retire about a year ago, and he left his post as a professor of psychology at City College and the City University of New York Graduate Center.

“I was wondering,’How much time is left?'” He said. “And it was very difficult — I have to tell you, I’m still ambiguous about my retirement.”

Brooklyn professor Schonfeld, 74, is lucky that he and his wife are getting a stable income from his pension, so they aren’t too worried about market movements (although living expenses). There is no increase in). But he misses the work he loved and the company colleagues and students he enjoyed through the film club for classic cinema enthusiasts he started. So he continues to engage in research and publishing. Originally from New Yorker, he began writing memoirs about growing up on the Glenwood House project.

A volatile market is in his mind, but after experiencing the financial crisis, Professor Schonfeld and his wife decided to save at least two years of living expenses in cash to survive the market decline. .. As the son of his parents who survived the Great Depression, maintaining stability was essential to his financial planning. His father was a postal worker and his mother was a part-time salesperson at the Abraham & Strauss department store.

“They were a modest means, and I went to Brooklyn College because it was free, so I know what life in the lower middle class looks like,” he said. Told.

Professor Schonfeld vividly recalls the financial pressures of New York in the early 1990s when the state cut college budgets and lifelong professors lost their jobs.

“It was really scary because my kids were in elementary school,” he said. “I knew there was a bumpy road ahead, so it didn’t give me the illusion that the prosperity that followed the Obama era was made of Teflon.”