Should You Lower Your Distributions If Your Portfolio Underperforms The Stock Market?
Another optimistic assumption of classic safe withdrawal rate studies is that retirees are able to earn precisely the underlying index returns net of the risks. But three truths dispute that idea.
Should Your Portfolio Include Commodities?
When it comes to investing, a whole bunch of magical investment solutions seem to be floating around out there, but should you really do anything differently?
Does Your Mindset Affect How You Make Retirement Income Decisions?
The fields of behavioral finance and behavioral economics have uncovered various biases humans have which are great for day-to-day survival, but somewhat maladaptive for long-term investing.
Common Investor Behaviors That Hurt Investments
In my post from last week, “behavioral coaching” was suggested to have the biggest impact on real-world investor returns. In Vanguard’s analysis, being able to overcome your own behavioral quirks could add more than 1.5% to your returns, as opposed to falling victim to your own human tendencies.
Does Your Retirement Plan Account For Your Own Cognitive Decline?
When it comes to financial planning, Vanguard’s “Alpha” and Morningstar’s “Gamma” are really just the tip of the iceberg.
The Value of Sound Financial Decisions: From Alpha to Gamma
David Blanchett and Paul Kaplan at Morningstar created a similar study about the value of good decision making. Their results and approach are different from those of Vanguard, but the goal is the same: to quantify the costs of poor and good decision making. Naturally, many assumptions must be made regarding good financial decisions and the impact of poor financial decisions.
The Value of Sound Financial Decisions
Good financial planning decisions extend well beyond where and how you invest. Two major research efforts have attempted to quantify how good financial decision making can enhance your lifetime standard of living. It is important to understand what this research means, because this may not always equal a higher portfolio return in the short term.
Two Philosophies of Retirement Income Planning
Within the world of retirement income planning, the siloed nature of financial services between investments and insurance leads to two opposing philosophies about how to build a retirement plan.
Which Is Better for Retirement Income: Insurance or Investments?
Retirement planning experts have long debated the question: Which is better for retirement income: insurance or investments? Wade Pfau weighs in.
Prophets & Losses: Predicting the Market is a Losing Proposition
Right now there is a lot of noise in the system. The din of the pundits quickly becomes deafening as they try to tell you what the markets are going to do this year. The financial media does this every year, and even more so with this year’s volatile start. This type of prognostication sells, […]
