Family of Four Taking Flight to Financial Independence

Did We Just "Lose" $55,000 in 3 Weeks?

When people make statements like “I lost $X in the market today,” or “I made $X in the market today," most of the time the statements are not true.


What Do You Mean?

On any given day the stock market is going to go up or go down, but the only way a person can actually lose or make money is if they actually sell some of the shares that they own.  Before we go further, let’s go over what actually happens when you buy stock.

When we tell you to buy VTSAX, we are recommending you buy shares of a company (or in the case of VTSAX you are buying a portion of every single company that is traded in the US Stock Market (thousands)).  These shares have a value placed on them, and that value fluctuates on a daily basis. Over the long term (assuming you are invested in VTSAX) you can expect the value of the shares that you own to go up by about 10% annually or 7% once you factor in an adjustment for inflation.  Note, that doesn’t mean they will go up 10% every year.  Rather, on average, over the long term you can expect them to go up about 10% before inflation adjustments.

When people say they lost money in the market today, unless they physically sold shares, they haven’t lost anything.  To further illustrate this, let’s look at our two retirement accounts and how they have performed over the last 3 weeks.  

Did We “Lose” Almost $55,000!? 

This is when most people would say, “I’ve lost $55K in the market over the last 3 weeks.”  But a closer look actually reveals that you have in fact gained (bought) almost 60 shares of VTSAX at a discount (congratulations savvy investor)!  The shares will eventually go back up.


Being invested in the stock market is going to be a wild ride.  The important thing to remember is we are in the stock market for the long haul, and we are buyers no matter what!  Block out all the outside noise, and continue to buy more shares.

What do you think?  Did you gain / buy in the stock market in the last few weeks?


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