2018 Year End Index Investing Results

Sorry it’s been a while since my last post.  Busy end of year.  Like pretty much everyone else my retirement accounts got KILLED during the end of 2018 market correction.  The S&P 500 dropped from a high of 2930 September 20, 2018 to a low of 2351 December 24, 2018 or 20%.  Today the S&P 500 is sitting at 2700-so it’s still in recovery.

As a long term, passive investor, I remained invested and continued my usual 401k contributions and squeezed my eyes tight during the volatility.  My balance had climbed to $289k in September only to plunge to $241k by Christmas Eve.  Today I’m only at $284k-still not quite at my account’s high.  On a bright note-all of my year end dividends, around $6k, were reinvested at market lows-so I was able to buy when the market was essentially on sale.

2018 Performance
Starting Balance: $229, 553.52
Final Balance: $255,875.42
Contributions: $44,850.03
Loss: -$18,528.13 or -6.7%

Actually it’s not that bad given the total market dropped 20%.  That’s the power of dollar cost averaging through regular investments.  Because I invest at regular intervals throughout the year (first and middle of the month) and last year’s market was so volatile, sometimes I’m bought when the market was down and sometimes I bought when the market was up. This led to buying at prices on average below last year’s highs so my account didn’t fall a full 20% for the year.  I also received dividends from my index funds and a handful of individual stocks (I know sometimes I just can’t resist a bit of gambling).  CEO’s and company management teams typically do everything in their power not to cut dividends-that’s a surefire way to drop their company’s stock price-so I got some amount of return even during the market correction.  And of course I reinvested when shares were cheap.

All in all, I’m still feeling good and sticking to my plan.  Here’s to decent returns in 2019 and me finally cracking $300k! Cheers!

Courtesy Pexels.com


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