Economic Education
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How Fear Helps Predict Stock Returns
Stocks are well known for their high volatility. Stocks respond to financial, economic, and political events in real time. The recent Brexit vote, for example, caused a sharp drop in stock prices. But the U.S. stock market was able to rebound in several days. Going forward, it is certain that stock markets will be sensitive…
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The Opposite of an Employee Benefit
It seems employers are being encouraged to help their young employees spend their money as fast, or even faster, than they earn it. Some employers are taking the bait. Some even think it is a benefit to make employees loans, help pay them off, or be better at payday loans than payday lenders.
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Can You Expect Your Money to Double in 10 Years?
Sometimes when I do a back-of-the-napkin estimate about how much I’ll have saved in the future, I’ll use a handy formula known as the “rule of 72.” This rule says that if you divide 72 by your rate of return, the resulting number is roughly how many years it will take your money to double.
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Investing: What You Know Might Hurt You
By relying on familiarity as a proxy for a more thorough understanding of these generic medicines, consumers often overspend on name brand medicines. Trusting our intuition instead of relying on objective data can also lead us astray when it comes to investing.
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Target Date Funds: In Defense of Investing Simplicity
Target date funds are investment vehicles that have gained popularity with regular people but get mediocre marks from investment advisers. Offered by most fund families (Vanguard, T. Rowe Price, Fidelity, etc.), they are frequently included as an offering in 401(k) plans. According to Morningstar, investors had about $700 billion in target date funds at the…
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Eight Market Predictions for 2016
Markets go up and down daily. For every buyer, there is a seller. But there is a broader historical point here. Even during periods of relative growth, there are negative stretches.
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You Can’t Invest What You Don’t Save
The most brilliant investment strategy in the world will not make up for a lack of putting money aside. How much you save versus how much you spend is the most important driver of whether you will succeed in having money for your future financial goals.
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A Zen Approach to Long-term Investing
There is one core tenet to my investment philosophy: Focus on important factors that you can control.
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Investing: Don’t Pay for Past Performance
Investing for retirement should be a long-term process. It would be nice to extrapolate meaning from three- or five-year performance, but more often than not we may actually be chasing returns that are likely to regress to the mean in the future.
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Investment Management Isn’t Rocket Science
Financial professionals recognize that many smart people, even those with large sums of money, don’t have a deep understanding of investing. What they’ve found is that if they can make something seem extra difficult, they can convince you that they must be doing a good job.
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•
How Fear Helps Predict Stock Returns
Stocks are well known for their high volatility. Stocks respond to financial, economic, and political events in real time. The recent Brexit vote, for example, caused a sharp drop in stock prices. But the U.S. stock market was able to rebound in several days. Going forward, it is certain that stock markets will be sensitive…
-
•
The Opposite of an Employee Benefit
It seems employers are being encouraged to help their young employees spend their money as fast, or even faster, than they earn it. Some employers are taking the bait. Some even think it is a benefit to make employees loans, help pay them off, or be better at payday loans than payday lenders.
-
•
Can You Expect Your Money to Double in 10 Years?
Sometimes when I do a back-of-the-napkin estimate about how much I’ll have saved in the future, I’ll use a handy formula known as the “rule of 72.” This rule says that if you divide 72 by your rate of return, the resulting number is roughly how many years it will take your money to double.
-
•
Investing: What You Know Might Hurt You
By relying on familiarity as a proxy for a more thorough understanding of these generic medicines, consumers often overspend on name brand medicines. Trusting our intuition instead of relying on objective data can also lead us astray when it comes to investing.
-
•
Target Date Funds: In Defense of Investing Simplicity
Target date funds are investment vehicles that have gained popularity with regular people but get mediocre marks from investment advisers. Offered by most fund families (Vanguard, T. Rowe Price, Fidelity, etc.), they are frequently included as an offering in 401(k) plans. According to Morningstar, investors had about $700 billion in target date funds at the…
-
•
Eight Market Predictions for 2016
Markets go up and down daily. For every buyer, there is a seller. But there is a broader historical point here. Even during periods of relative growth, there are negative stretches.
-
•
You Can’t Invest What You Don’t Save
The most brilliant investment strategy in the world will not make up for a lack of putting money aside. How much you save versus how much you spend is the most important driver of whether you will succeed in having money for your future financial goals.
-
•
A Zen Approach to Long-term Investing
There is one core tenet to my investment philosophy: Focus on important factors that you can control.
-
•
Investing: Don’t Pay for Past Performance
Investing for retirement should be a long-term process. It would be nice to extrapolate meaning from three- or five-year performance, but more often than not we may actually be chasing returns that are likely to regress to the mean in the future.
-
•
Investment Management Isn’t Rocket Science
Financial professionals recognize that many smart people, even those with large sums of money, don’t have a deep understanding of investing. What they’ve found is that if they can make something seem extra difficult, they can convince you that they must be doing a good job.