I don't personally think that a 20% drop in single day is that much of a problem. If you FIREd based up a reasonable valuation and the market after during FIRE was overvalued then a 20% drop is no problem per se. If you understand that such drops can happen from time to time then it is par for the course and you do what you did, keep on DCA your investments. If however we saw 20% loss 3-4 days in a row that might be more of a course for concern but then you have to ask yourself, has the business economy just gone to shit in a handbasket or is it simply temporary negative selling? Short-term movements are not the problem, long term poor results are far more of issue to someone playing the long game as any FIREd or wannabee FIREd investor needs to be.
I remember my father telling me at the dinner table that the market dropped a lot today and he lost more money than he dare tell me. But I never heard anything much before or since about the "market" to put that in context. This is a man who understood the internet boom and bust for what it was and compared it to railway building a century or more before it. In that context even he should not have been too concerned.
therealchips wrote: The author says "only two years" but during that period, we didn't know how long it would take to recover from that stunning one-day loss. It is easier to be calm about that period in retrospect, knowing how it would come out, than it was living through it without such knowledge. This may not be the worst case that hocus had in mind, but the crash of 1987 is the worst day I have seen personally as an investor for forty years.