Retirement; like your parents, but way cooler
In 1991 Billy and Akaisha Kaderli retired at the age
of 38. Now, into their 4th decade of this
financially independent lifestyle, they invite you
to take advantage of their wisdom and experience.
Surviving a "Bear Scare"
In or Just Before Retirement
Billy and Akaisha Kaderli
It's everyone's nightmare: watching retirement assets vanish in a bear market,
especially in or just before retirement.
Many of you will remember the severe market downturn of 2000-2002, the Dot Com
Bubble, when the Standard & Poor's 500 Index fell 37%.
We'd be lying to say that this declining market didn't affect us. Our finances
dropped about the same as most others on a percentage basis. As retirees, with
no regular paycheck coming in on Friday, this event could have spelled disaster
for our future plans of maintaining our financial independence.
Then there was the 2007-2009 “Great Recession” where the market fell by almost
50% lasting 17 months, testing our courage.
The 2020 Covid scare shook the market’s foundation, earning the title of the
“shortest bear market” in the S&P 500 history lasting only 33 days.
And now here we are again in 2023 where the market is in the grip of a bear. How
much longer will this last? How low will we go?
should we do? How do we cope?
First, we’ve learned from past bear markets the importance of some cash flow.
Having aged a bit and now receiving social security we have adjusted our
portfolio to a more balanced one adding DVY, iShares Select Dividend ETF as a
dividend-producing asset as well as increasing our cash holdings.
Then, there are regular chats about our finances and the state they are in, in
hopes of averting a possible worst-case meltdown. We have discussed the fiscal
facts and tried to extrapolate them out into the future.
One obvious problem: No one can predict the future.
Friend asks “Billy, why are you investing now? You know the market is crashing,
right?” Same friend 10 years later: “Hey Billy I heard you retired early. How
did you do that?”
Using history as a guide
Researching bear markets, we take heart from the knowledge that past downturns
Retiring is definitely easier when markets are rising as compared to when they
do you know if you are in a rising or falling market? That depends on your
starting point and there has been no 20-year rolling negative returns.
Another question to ask – is this is a good time to buy equities? For every
buyer there is a seller and they both think they are right.
Maybe the cure for cancer will be announced tomorrow or the global economy will
We just don’t know.
That's the point.
This is why you need to create the mental confidence to ride out these
fluctuations and not panic out of the market.
What we don’t do is lock ourselves in, mentally or creatively. In our
experience, it hasn't proven useful to recede into fear or exaggerated "what if"
scenarios. It is necessary for us to be clear-headed and have fun, with the
degree of freedom that our lifestyle requires.
We have survived the past bear markets and are now into our 33rd year of
We plan on surviving this one too.
The S&P 500 Index from the beginning of our retirement.
Weathering these financial storms strengthens our fortitude and it's comforting
to know that since our retirement in 1991, our net worth has grown through these
ups and down well above the annual inflation rate after expenses.
Early Lifestyle appeals to a different
kind of person – the person who prizes their
independence, values their time, and who doesn’t
want to mindlessly follow the crowd.
Retire Early Lifestyle Blog
About Billy & Akaisha