The Iran War is Killing My Retirement

Hi Scott,

I am very stressed about the Iran war, and the impact it will have on my superannuation. I am 61, still working, and looking to retire in the next four years. Therefore I check my Australiansuper balance if not daily, every second day! I spent the last 60 years not giving a cuckoo about the share market, and now it keeps me up at night. Experts are suggesting that this is the start of something much bigger. I am thinking of moving my super to cash until this blows over. It would help me sleep at night.

Yasmine

Hi Yasmine,

You wrote: "I spent the last 60 years not giving a cuckoo about the share market."

That might actually be the smartest investing strategy I've ever heard.

Because when retirement is four years away, every wobble in the market suddenly feels personal. It's like waking up an hour before your alarm. Every creak in the house suddenly sounds like a burglar.

On Monday, as I was sipping my coffee, I read this headline:

"More than $100 billion was wiped off the ASX in less than an hour in a horror morning for Australian investors."

I actually love these headlines, because they are just so… thirsty.

Let's decode it:

"$100 billion wiped off" (seems like a lot)

"in less than an hour" (seems quick)

So was it a horror morning for Australian investors?

Nah.

Another way of writing that headline is:

"Sharemarket down to levels not seen since… Christmas."

Even accounting for Iran and the $100 billion wipe out, over the last year  the sharemarket has delivered a 14% return, when you factor in dividends (which you should).

Ho! Ho! Ho!

So I have some advice for you to get more sleep.

First, stop checking your super balance every week. It's like planting an apple tree … and then checking on it each morning and wondering whether you should pull it out and replant it somewhere sunnier in your garden.

Second, build up a cash buffer within your super fund. Money you can live off when you retire. Book in to see a financial adviser at AustralianSuper. 

Something like three years of living expenses is a good number.

Sleep well.