Safe vs aggressive: 3 years in HYSA/bonds vs growth (QQQ)
On good years, growth (e.g. QQQ) compounds ~11% while safe assets (HYSA, bonds) earn ~2–3%. When the market crashes 50% and takes years to recover, what if you keep a safe buffer vs invest everything in growth? This compares both paths using your actual dollar amounts.
Past crashes: how long to recover?
History doesn’t predict the future, but major drawdowns have taken years to recover. See Market drop planner blog for more.
| Event | Drop | Years to new high |
|---|---|---|
| 1929 crash | 86% | 25 yr |
| 1937–38 | 60% | 8 yr |
| 1973–74 bear | 48% | 7 yr |
| 2000 dot-com | 49% | 7 yr |
| 2008–09 financial | 57% | 5 yr |
| 2020 COVID | 34% | 0.5 yr |
Your scenario
Enter your yearly expenses and how much you have in growth vs safe assets today. We run one crash (with a flat period and recovery) and show which approach leaves you with more at the end of recovery.
How much you spend in a typical year. We use this to convert results into “years of expenses”.
Total in growth investments now (excluding your safe cash/bonds below).
Cash, HYSA, short-term bonds you treat as \"safe\". Safe strategy keeps this; aggressive invests it in growth.
Approximate annual return for HYSA/bonds. 2–3% is a common range.
Long-term average return you assume for your growth bucket (e.g. QQQ).
How many good years you get before the crash starts (0 = crash immediately).
How deep the one-time crash is. 50% is similar to 2008–09.
How many years the market stays flat at the lower level before normal growth resumes.
How long you let things run after the crash period. We compare results at the end of these years.
Net worth at end of recovery (18 years total)
Safe option ends with 171,662 more.
How we do the math
1) Convert buckets to “years of expenses”: safeYears = safeAssets ÷ yearlyExpenses, growthYears = growthAssets ÷ yearlyExpenses.
2) For each year we: grow safe by (1 + safeReturn%), grow growth by (1 + growthReturn%) except during the flat crash period, and if it is the crash year we first mark growth down by (1 − crashDepth%).
3) From the crash year onward we spend 1 year of expenses each year: in the safe option we draw from safe first, then growth; in the aggressive option we draw from growth because there is no safe bucket.
4) We repeat this for all years (good years → crash years → recovery years) and convert the final total back to dollars: net worth = totalYearsRemaining × yearlyExpenses.
This is a simplified model: one crash at a fixed year, no ongoing contributions, and historical recovery times vary. Use it to see how sequence-of-returns risk (selling growth in a crash) can hurt the aggressive path, and how a safe buffer can avoid selling low. Market drop planner helps you plan which assets to sell if a drop happens.