Have had thoughts about cashing in the funds...

[progree]

17. It did rebound and went on to set new all time highs

Last edited Mon Nov 26, 2018, 08:06 PM - Edit history (2)

then crashed in 2007-2009, then rebounded to set new all time highs...

The market has never, ever, ever set a new all time low, not even once. But it periodically sets new all time highs.

Over the long run, judging on the S&P 500 with dividends reinvested has averaged a 10.something% compounded average annualized return since 1926 -- that's a a doubling about every 7 years on average.

They say buy on the dips, not sell on the dips for good reason. Buying on the dip results in a gain when it inevitably gets back to its original value (if we're talking about a broad index fund like the S&P 500 index fund or Total Market fund). Selling on a dip locks in the loss on the dip.

Since its August 31, 1976 inception, the Vanguard S&P 500 index fund (VFINX) with dividends reinvested and after expenses, has returned 11.18%/year on average (through Nov 23, 2018). It has thus increased 87.75 fold during this 42.22 year period (1.1118^42.22 = 87.75). This represents, on average, a doubling every 6.54 years. On average.

https://www.thestreet.com/quote/VFINX.html

Yes...I've no intuition regarding money matters..At least not like some

Me neither. That's exactly why I'm a buy-and-hold investor, at least as far as a core of broad market index funds. Because I can't guess when and where the market will drop (I know it's inevitable), and I don't know when the market will rise (I know that's inevitable too). All I know is that the history of the market back almost 100 years is for higher lows and higher highs. So I don't attempt to time the market. Very few are successful at it enough to beat a buy-and-hold investor.

Studies have shown that the vast majority sell on dips, and then don't get back into the market until it has risen for years-- missing out on the gains that the unintuitive buy-and-hold investor has enjoyed all along. Studies by Dalbar and others have shown that most investors investing in mutual funds have done worse than the funds' performance because of this tendency to panic sell on the dips and to wait way too long to get back in.