Retirement saving: three things I wish I'd done 10 years ago

Ten years ago, the world economy was in a hugely challenging period. Although nobody knew it back then, the coming months were set to see stock markets continue to fall so that the FTSE 100 traded at under 3,500 points.

Investor sentiment was at a low ebb, and there were fears that a full-on meltdown of the financial system would take place. As a result, few investors were even contemplating making share purchases at that time.

However, by thinking long-term, focusing on a company's fundamentals and buying slowly, it's possible to turn financial crises into opportunities. With the next bear market potentially not all that far away, the impact of those three moves on your retirement prospects could be dramatic.

Long-term focus

Of course, taking a long-term view during a bear market is difficult. When share prices are falling and the prospects for a variety of companies, industries and economies are deteriorating day-by-day, it's hard to consider where the stock market could be in five or 10 years' time.

However, by doing so, it may be possible to improve portfolio returns. Investing back in 2008 would have meant short-term pain, since the index dropped further from its mid-2008 level of 5,800 points. However, with it now trading around 2,000 points higher, and offering a high yield at the time, the impact on retirement savings would have been positive for a long-term focused investor.

Fundamental strength

As mentioned, during a bear market, it can feel as though a multitude of industries and companies are set for financial Armageddon. The reality, though, is that most companies survive - especially ones listed in the FTSE 100.

As a result, focusing on fundamentals such as debt levels, cash flow strength and how wide a company's economic moat may be, could lead to an improved risk/reward ratio for an investor. While it may not be possible to avoid poor performance in every case, buying stocks with sound track records in a variety of market conditions could improve your portfolio's risk/reward ratio.

Buying slowly

While the stock market may have looked relatively cheap in 2008, it fell by an additional 2,400 points over the following nine months. Therefore, during a bear market, it may be wise to buy slowly, rather than pile in over a short timescale.

The benefit is that it can reduce the pressure on an individual to find the bottom of the stock market's fall. Should the index decline further following a purchase, investing more capital as part of a sustained buying programme can provide peace of mind. After all, for a long-term investor, it's beneficial to buy as low as possible - even if that means paper losses are experienced in the short run.


While the FTSE 100 is currently experiencing a bull run, it may be prudent for investors to remember that a bear market has always followed a bull market in the index's history. As a result, it may be wise to hold some capital back, as opposed to being fully invested.

And when a bear market does come along, taking a long-term view, buying slowly and focusing on company fundamentals could help you to maximise your portfolio returns. Doing so could help you to retire earlier than investors who fail to grasp the opportunities which bear markets can bring.

Buy-And-Hold Investing

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