Jumping on the bandwagon

Nearly every blog I read had posts yesterday & today about the giant drop in the stock market.

I’m there too.  My 401K is down almost $1000 since the end of last month; my Roth is down $1500 from the beginning of the year.  I usually try to ignore the news, because as the balances drop & the talking heads screech I want to move all my money into my mattress. (If I started doing that a year ago, I’d be ahead right now.)  No matter how reasonable I try to be, I’m freaking out.

It doesn’t help that Chad insists I tell him what to do with his money, and he now is yelling at me about the market’s performance.  Because I totally have control over this.

I considered reducing my contributions to my 401K.  I know you’re not supposed to do it.  I’ve been trying to find a reason to do it (I could save it for the wedding!), and the only thing that is keeping me from changing it right now is that I wouldn’t get that much extra cash by scaling things back.  A 5% decrease in contributions will be less than $100/paycheck.  Wow, I’m sure that extra $700 will cover a lot toward the wedding!

When things get tough, I turn to Excel.  Spreadsheets soothe me.  I made a pie chart to track my spending, similar to StackingPennies’ “Where is My Money Going?” post from a few months ago.

I really want to get the savings up to 50%.  The charity spending should go up, as should gift spending.  I’m going to change my federal tax allowances so that I have less withheld from my paychecks.  I checked the IRS calculator, which said I should set it at 6, but I still like to get a refund, so I’ll probably just bump it up to 2 or 3 allowances for now.  Otherwise, I guess I’m pretty pleased.

So what are you guys doing?  Silently freaking out but taking no action?  Taking everything out of the stock market and putting it into your mattress?  Plugging up your ears and singing “LALALA” to block out everything?

LALALA!

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3 Responses

  1. The only move I’m making (which I admit is probably irrational) is moving some $ from Vanguards Prime Money Market to ING.

    Also wondering if I’m overpaying taxes, but too scared to adjust it.

    Suffering from anxiety, taking deep breaths, and trying to peel my eyes away from the stock charts (also, i can’t help but wonder if I could use a Kalman Filter algorithm and try to track them, but that’s another issue).

    And I wouldn’t scoff at $100 a paycheck, personally. I’ve debated 1% (which is only $40/mo) and opted not to change.

  2. @SP: I don’t think that sounds irrational… at the very least, the money at ING is FDIC insured. And I’m a firm believer that if something is going to make you feel more comfortable, then you should do it (within reason), even if it’s not the “best” decision.

    As far as the tax allowances go, I use the IRS withholding calculator here, and it will give you a good idea of how many allowances to take. I hate to owe and love the refunds, so I usually undershoot it.

    $100/paycheck would be a nice extra, but I guess I was feeling like I’m throwing away tons and tons of money. In actuality, after taxes, it’s not that bad.

  3. I think I’m silently freaking out as well, but trying not to show it.

    And I’m with you = spreadsheets soothe me!

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