What Investors Should Know About IPOs
A successful restaurant rarely opens its doors on the first day with every table filled and every reservation booked for the next six months. Even the best restaurants spend years refining their menu, building a reputation, and proving they deserve a loyal customer base. Investors, however, often expect newly public companies to justify valuations that […]
The Real Cost of a Roth Conversion
Few retirement planning topics generate more debate than Roth conversions. Some view them as one of the most powerful tax planning opportunities available. Others argue they’re frequently oversold, causing retirees to pay taxes years before they need to. Both perspectives have merit, but the problem is that they often focus on the wrong question. Many conversations begin by […]
Should Your Retirement Spending Rise and Fall with the Market?
Most retirement income strategies assume spending will remain relatively stable over time. You retire, determine a sustainable withdrawal amount, and then spend roughly that amount for the rest of your life, perhaps adjusting for inflation along the way. That assumption is so common that it often goes unquestioned. Yet there are retirement income strategies built on a very different idea. Rather than trying […]
The Biggest Inflation Mistake Retirees Make
Stocks are often described as one of the best long-term hedges against inflation. While that statement is generally correct, it can contribute to more retirement planning mistakes than most people realize. The issue is not that stocks fail to outpace inflation over long periods, but that many retirement plans often assume inflation has been addressed simply […]
Why Own Hundreds of Stocks Instead of One Fund?
Most investors are familiar with the logic behind index investing. Rather than trying to pick winning stocks, they buy a fund that owns hundreds of companies and allow diversification to do the work. The approach is simple, inexpensive, and has proven difficult to beat over long periods of time. Direct indexing starts with a seemingly […]
Home Sweet Home Bias: Overweighting US Stocks in Your Portfolio
Investing is deceptively simple. Until it’s not. As investors, we want to start with the market portfolio—that is, by definition, the most efficient portfolio. But we’ll also want to customize our investments to address our specific situation. For instance, the global bond market is substantially bigger than the global stock market, but most retirement-focused investors’ […]
Are Stocks Safer in the Long-Term?
When you’re investing, you need to focus on the long-term. This is one of those pieces of received wisdom that everyone has heard, but it’s often wildly misinterpreted. There’s an idea that stocks get safer the longer you hold onto them because you can ride out the bad periods if you are disciplined enough – it’s just a matter of sticking around until the market rewards you for being a “good investor.” To put it simply, this is not the case.
How Does the Market in 2018 Stack Up Historically
There’s been a lot of ‘sturm und drang’ around what the markets have been doing lately. The financial media has been talking about how this is the sign of the inevitable end of the world. Of course, we’ve had a few things lately that were also supposed to be signs the world crashing down on our ears. But, well, the world is […]
Black Monday Is Not a Black Swan
Last Monday, the S&P 500 dropped by more than 3.5%. This is a big drop, and has a lot of folks wondering if they should be invested in the market at all. It’s easy to get wrapped up in media coverage, and not keep last Monday in perspective. It was a bad day, but historically, […]
