Published Articles
How Long is the Long Term?
Everyone always talks about investing (and planning) for the long term. But they’re usually vague about what the “long term” actually means. Does that mean 5 years? 10 years? More? (Spoiler: the answer is definitely more). And frankly, talking about how you…
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Occam’s – Do the Midterm Elections Matter to the Market?
The 2022 midterm elections are coming up (remember to vote on November 8th). With every election, there’s always a lot of talk about how important it is to vote (true), and that if the other side wins it means the end of…
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Lessons For The Next Crisis
“I find your lack of faith disturbing.” I gotta say, we agree with Darth Vadar on this one. When times of crisis arise, people naturally have a range of emotions, including fear, panic, and mistrust. This can lead to behaviors that directly…
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A Warning to the Advisory Profession: DALBAR’s Math is Wrong
Boston-based DALBAR has published updates of its “Quantitative Analysis of Investor Behavior” study annually since 1994. The study is meant to educate investors about how the returns they earn generally lag behind the returns for market indices widely reported in the media.…
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Which Are You More Worried About: Running Out Of Money While You’re Alive Or Dying?
As David Blanchett says: failure is really only failure if wealth is depleted while you are still alive, not just over an arbitrarily long time period.
Read MoreCommon 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.
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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.
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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.
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How Do Presidential Elections Affect The Markets?
With the presidential election coming up, people are naturally curious about what the elections mean for the stock market – and, more importantly, for their investments (and everything those investments represent).
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The Changing Risks of Retirement
The changing risks of retirement are the primary differentiator of retirement income planning from traditional wealth management.
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Academic Acceptance for Reverse Mortgages in Retirement Income
“Although reverse mortgages aren’t for everyone, the reluctance to consider use of reverse mortgages in the distribution phase limits the flexibility of distribution strategies.”
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Improving Retirement Income Efficiency Using Reverse Mortgages
Maintaining higher fixed costs in retirement increases exposure to sequence risk by requiring a higher withdrawal rate from remaining assets. Drawing from a reverse mortgage has the potential to mitigate this aspect of sequence risk by reducing the need for portfolio withdrawals at inopportune times.
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