Monday, December 22, 2008

a quick recap of this year's investment performance

2008 was a very interesting year.

In February I liquidated most of our non-retirement holdings, which I had kept in a vanguard 2025 index based mutual fund.

I put the proceeds into our HELOC to help reduce the impact of a >6.5% interest rate. At this point I'm fairly glad I did as we missed most of the drop in the market - though it was not my plan or expectation at that time.

Our remaining invested assets were either in ETFs that I gradually sold off. I placed sell limit orders with a good till 90 day expiration targetting 20% returns.
About 5 out of 7 hit the target and I sold them off - using the proceeds to reduce debt or provide liquidity in an on-line money market account.
two of the ETFs (the Indian ETF and small business) never hit their targets so I decided to hold them for the long term until they recover. The indian fund IIF took very hard hits. I reinvested this summer's dividends (which were almost 50% due to the drop in price) and am tempted to buy more as I feel the Indian markets are incredibly underpriced - I don't see the benefit of offshoring going away during difficult financial times - despite a Democrat controlled congress and threatened trade restrictions - the economic differences are just too extreme.

As to the other investments, they've taken a huge hit, but since they're long term retirement investments, we'll just wait for the up-cycle.
Overall our retirement savings dropped from about $400k to $300k, though it has been creeping up to about $315k.

In addition my wife's employer finally switched their retirement plan to Vanguard, so we'll be putting another $15.5k this month (and last month). I'm going to accelerate my contributions in the beginning of january as well. I imagine I'll schedule things to complete my contribution within the first three months of the year.

My motivation is reflected by my discomfort in the financial condition of my employer and my own sense of political instability within my division at Big Company. Boss left, new boss coming and I'm concerned my head's on the block. What an awkward situation to be in.

My thoughts are it's best to accelerate 401k contributions in case I'm not in a situation to contribute to a 401k plan later this year.

Keeping moneies liquid seems like an important priority right now.

Regards, makingourway

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