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If the market tanks again like it did 9 short years ago then pulling your money out will be immensely painful.

• JoshTriplett 10y ago
  Sure. But consider the relative risk of having a large-scale emergency requiring you to sell a large amount from an index fund in a hurry, versus the much more definite loss of return of having large quantities of money in a savings account rather than invested. (Also consider what other mechanisms you have covering such emergencies, such as various forms of insurance, disability coverage through your employer, etc.)
  • taurath 10y ago
    The inflation rate is 1.1% for the past 12 months - its not ideal but IMO its not that terrible relative to the risk of a market downturn blowing up your money. Maybe its a generational thing - I watched the .com bust and then 2007. Stocks are at their highest point ever right now - I'm not so sure it'll beat the mattress.
    • JoshTriplett 10y ago
      I went through both of those busts, and had (a small amount) of stock during the first one. That's when I learned never to buy individual stocks, to do dollar-cost averaging (with a fixed amount every paycheck), and to not pay attention to short-term returns. Another way to look at those two busts: "hey, the market's on sale right now, the fixed amount I put in buys more shares right now".