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A smarter investing strategy for retirement

I've moved all my money to money-market funds. My plan is to wait for the crash and when things start looking better get back into the market to ride the rebound. Do you think this is a good idea? --Tim H.

If I thought you were able to predict when stocks will crash, when the market will hit bottom and when it will actually recover, then I'd say your plan is masterful, a sure-fire way to avoid losses, capitalize on gains and boost your long-term return. Unfortunately, your chances of doing all that range between zero and none. So I consider your idea a fantasy, not a bona fide plan.

The problem is that while it's easy to identify market peaks in retrospect, it's virtually impossible to call market tops in real time. Back in late 1996, for example, when former Federal Reserve chairman Alan Greenspan delivered his famous "irrational exuberance" speech ...

July 29, 2015