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Don’t Marry the High

A simple piece of advice I have given is, “Don’t marry the high.” I first gave it to a friend at a costume party when she confessed the downturn in the stock market we were experiencing at the time, was freaking her out. She was a few years away from retiring. She had been contributing to her 401(k) for decades. She felt on track, but the market was coming down from recent highs. Whenever she looked at her account, she compared it to the high water mark she saw when the market was at an all-time high.


Not getting attached to a high balance is sound logic. Yet, managing our expectations in the real world is tough to do.


As I write this, the S&P 500 is over 5,000. Surpassing the 5,000 threshold is significant. It is the new high-water mark for the market. As someone who subscribes to the investment philosophy of focusing on S&P 500 index funds (and total market), it is hard not to get a little excited.


I couldn’t help myself from taking the dopamine hit of checking my account balance to see what this new high meant for me personally. After enjoying the happy rush of a new high dollar amount listed under my name, I reminded myself not to marry this high. As a result, I decided to leave my personal account tracking at the lower amount I set last year.


To keep from getting too attached to a set balance amount that I know is subject to change daily, I keep a separate spreadsheet that I consider my master. Instead of trying to plan based on amounts that constantly change, I intentionally record a lower balance. This is the amount I use for planning and measuring my long-term goals. Tracking and planning based on a lower amount gives me peace of mind. I know I’m not basing my long-term plans on the whims of a short-term rally. It allows me to sleep better at night. If it continues to increase in value, great. If it doesn’t, I still know I’ll be fine.


It's not sophisticated or even formula based. It’s just my trick to keep me from marrying the high.


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