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You wrote, I like the idea of shifting more into bonds as I get closer to retirement. I don't want to be 100% in stocks. Lost everything during the recession, so my first inclination is to put everything under my mattress. The decision to invest again is a major milestone for me. Need to protect myself a bit more this time around.

I hate to break it to you, but bonds are not automatically "safe" investments either. They are simply "relatively uncorrelated" to the performance of equities. During the financial crisis bond prices cratered. Some bond funds very quickly lost half or more of their NAV.

Personally I jumped into the fixed income market in 2008. I bought when people were scared. Buffet would have been proud. In a few short years I made what seemed at the time like a lot of money. But today I hold only a very small bond position.

Today bonds simply are not cheap. But today stocks are not cheap either.

I'm not saying you shouldn't invest, but I'd say that waiting 9 years to jump into the market is a very telling comment of what you might do the next time the market corrects.

Officially the last recession started June 2009. Since that date the S&P 500 has had a total return of 217.074%, including reinvested dividends. In other words your money would have tripled over the past 8+ years. The annualized rate of return has been 15.013%. These numbers are simply not normal. Sure we were starting from a trough, but over longer time frames the S&P 500 total return is more like 8-10%/year.

My point is simply this: You seem to be out at the bottom and don't get back in until we appear to be at all-time highs. Personally if I saw that behavior in myself, it might worry me more than a recession.

- Joel
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