How do you feel when the "market is down"?

These things happen. A lot. I first wrote about this in September 2015, though some of the links I pointed to are now 404's.

The hypothetical investor who captured the entire 128,000% return over the last nearly sixty years would have experienced plenty of discomfort along the way. Disney has seen eight separate drawdowns of at least thirty percent. To be clear, what this means is that on eight different occasions, Disney would hit new all-time highs and then fall by at least thirty percent.

Even “winners,” rare as they are, put us through emotional turmoil over the lifetime of our ownership. Winners like Disney and Apple, who everyone that invests hears about, have been down quite a bit over their lifetime. As an example, Disney has been 20% down from its high’s for 55% of the time. Even though it’s grown an astonishing 96,000%+ since its 1957 IPO (according to Yahoo! Finance).

If you own Amazon or Bitcoin or Intel these last few days, you'll have experienced some of this discomfort. Things are down and that's kinda hard to stomach.

The comfort of a dividend paycheck

Notice the chart:

When I first published my book I had kept a sample portfolio tracking results and charting them on a monthly basis. This chart serves as a powerful reminder of the value of the dividend paycheck.

Have a look at the blue line. That represents the total portfolio value. You see how it goes up and down? In fact, right after I started the sample portfolio it dropped for three months. How's that for demotivating?

Then it went up – yay! But then back down, and even lower than before. Boo. And so on. I mean, it's an emotional roller coaster. But that's what stock prices do. They go up and down, often without any apparent reason.

Look at the red line now.

Notice anything?

It keeps going up. Nice, huh?

Not only great because it means something is growing (it's the dividend paycheck!). It's growing with each dividend reinvestment and each dividend increase.

This growth helps because it keeps us emotionally steady rather than whipsawed by the ups-and-downs of the market. In fact, tying this back to the quote above, if you had purchased Disney at the IPO you'd spend more than half your time owning the stock down more than 20% – worried, anxious.

Don't tell me how to feel

Worried and anxious is exactly the opposite of how being responsible should feel. And, that's why 'The Elephant in the Room has a Paycheck' is unique. Not because it uses some magical investing technique never seen before. Rather, because it uses tried-and-true techniques with unique metrics to help keep you motivated to stick to your plan. To help you understand the value of starting young and planning for a secure future.