Marginal Thinking

By | 2017-08-24T06:53:08+00:00 August 24th, 2017|Global Market Update|

What’s your marginal tax rate? Source: Healthcare.gov It’s an important question. The answer will determine whether it makes sense to buy municipal bonds, whether to put money into a Roth or Traditional IRA, and even whether to convert a Traditional IRA into a Roth. Let’s face it: almost everything we do has tax consequences. The government puts its finger into almost every financial pie – they’re our partner in almost every financial decision we make. But they’re a passive partner. It’s perfectly reasonable to [...]

Seeking Safety

By | 2017-07-17T16:45:21+00:00 July 12th, 2017|Global Market Update|

Are there any safe places? Photo: Ben Tubby. Source: Wikipedia During the Cold War the superpowers relied on a doctrine called “Mutually Assured Destruction,” or MAD. The idea was that neither party would initiate a nuclear first strike, because enough of the other side’s nuclear arsenal would survive to retaliate. The global devastation would be so complete that both sides would lose. To average folks, the doctrine seemed “mad,” indeed. There was a low-grade fear surrounding everyday life. If someone irrational got hold of [...]

Putting Fun Into Finance

By | 2017-07-17T12:21:22+00:00 April 19th, 2017|Global Market Update|

Can personal finance be fun? Photo: Melodi2. Source: Morguefile For most of us, money matters are unpleasant. They involve budget issues and trade-offs and hard choices that frustrate everyone. So we need to encourage ourselves, to set up some kind of incentive program. For example, estate planners say you should update your will every three years or so. So: think about what would be a special treat—like eating at a favorite restaurant, or going to a special show—and reward yourself when you update your [...]

Health Care, Wealth Care

By | 2017-07-17T12:21:43+00:00 September 15th, 2016|Global Market Update|

What are you doing to stay healthy? Photo: Seeman. Source: Morguefile This may seem like a strange question from a financial professional, but our bodies and our finances are connected. Health is an integral part of our lives, just as money is. And finance is a lot like medicine: there are lots of technical issues that require specialized training, but applying them is often pretty basic. Health-wise, we should stay active, eat well, and get enough rest. Financially, we need to spend less than [...]

On Tips and Tipping (Part 2)

By | 2017-07-17T12:21:53+00:00 July 21st, 2016|Global Market Update|

On Tips and Tipping (Part 2) Everyone wants a tip. What’s the best way to make money? Photo: Nick Stanley. Source: Life of Pix Profitable investing starts with a plan. It starts with investors reviewing their goals, their fears, how much time they have, how much access to their money they need, and other circumstances. No one plans to fail, but many people fail to plan. And if you don’t know where you’re going, any road will do. But once you have a plan, [...]

Getting Going

By | 2017-07-17T12:21:57+00:00 May 19th, 2016|Global Market Update|

How do you get started investing? Photo: Tyler Main. Source: USMC I got involved with investing via a different route. I had studied computer modeling in college in the early ‘80s. While looking for a job, I met with a bank manager who had a computer model for the bank’s earnings and balance sheet, but didn’t have anyone that could run the model. Tentatively, he hired me to implement the computer simulation. I got the analytic software to work much faster than expected, so [...]

Stop It!

By | 2017-07-17T12:22:06+00:00 March 21st, 2016|Global Market Update|

What should investors stop doing? Photo: Kevin Connors. Source: Morguefile Often, improving performance is a matter of ending bad habits. This is true in many areas of our lives. If we want to have better relationships, then it’s a good idea to stop avoiding difficult conversations. If we want to have better personal finances, we should stop buying major items without a plan. If we want to be better tennis players, we should stop jumping when hitting the ball. So here is a list [...]

Growth Investments

By | 2017-07-17T12:22:46+00:00 May 26th, 2015|Global Market Update|

Is investing like gardening? Source: Johnny’s Selected Seeds Both require planning. Both encourage diversification. In both cases, time is your friend. Successful investors and gardeners look past their current circumstances to discern the underlying trends. And both have to watch out for pests and poachers who can steal what you’ve cultivated. […]

Thinking About Investing (Part 2)

By | 2017-07-17T12:23:02+00:00 March 3rd, 2015|Global Market Update|

How can we be more intelligent investors? Rodin, The Thinker. Source: Metropolitan Museum of Art Investing is a mental exercise. Form a financial plan, then implement it, then review it. These are all conceptual activities—physical prowess is not required. But investing isn’t like studying philosophy or engineering. It engages our emotions. And our emotions habitually make us act less intelligently. […]

The Emotional Investor (Part 2)

By | 2017-07-17T12:23:03+00:00 February 12th, 2015|Global Market Update|

How do we manage our emotions? Source: Behaviorgap Investing is challenging. It brings out the worst in us. When the market is running, we just want more. And when the market goes down we’re tempted to sell just when things are bottoming out. It’s been shown that money goes into and out of mutual funds following the market. As a result, these investors typically underperform their funds by a lot—often by two to three percent. Three percent may not seem like much, but over [...]