A way that psychologically helps me from extreme price volatility that $TSLA continues to offer year over year is by keeping my living expenses and expectations in life very low.
I first make sure my daily expenses are fully covered via different sources of active income, salary, passive income, other investments.
Once that part is covered, I live under the radar, frugally, keeping my living expenses super low, irrespective of my wealth change (up/down).
Many people change the way they live as their wealth goes up, so when it goes down, they can't change.
Not me.
I can easily go back to eating ramen noodles and sleeping on the floor every day again if I needed to, bc my living style, cost, and expectations have NOT changed.
I’ve spent ~$5M in buying new real estate in the bay (all cash) and paying down any remaining mortgage I’ve had since 2020 (no debt).
Many saw my moves as financially dumb, but looking back from today, it was one of the smartest decisions I’ve ever made (outside of $TSLA).
Sure I could have more $ if I kept it in the market longer term..
Sure I could have continued to lock in a very low interest rate (our first home was 3.375%, 30 yr fixed), but having real estate w/ no debt / payments is one of the most compelling avenues of safety you can have.
In times of turmoil, layoffs, QT, compressing P/Es, and rising interests, having solid properties in the best locations w/ no debt, that produce strong cash flow that go straight to the bottom line is so important, it’s under-appreciated by many real estate so called “gurus”.