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Behavior

Monopoly

D.J.  |  Oct 27, 2026

Be the first to comment.
Read more »

In Retirement

The pension conundrum and a solution

R Quinn  |  Oct 26, 2026

"Mark, in response to your question, I'm not thinking of people like your wife (20 years each with two employers, good for her!!), but for people who, for whatever reason, don't enjoy that type of stability and longevity in their employment. And mindful that at age 30, one doesn't know where one will be, pension-wise, at age 65. (I recognize that circumstances may be different in the UK.)"
- Partly Sunny
Read more »

In Retirement

Social Security “Haircuts”

achnk53  |  Oct 25, 2026

"Dan, that is the way I read Richard's comments also."
- Dave Melick
Read more »

Investing

Do I really need International funds in my portfolio? I say no.

Bruce Roberts  |  Oct 26, 2026

"For a long time I have followed the logic that major US companies in S&P derive significant revenues from their international operations. But recently, I have started moving towards a still more diversified portfolio. Rather than VTI, based solely on US stocks, I have moved towards VT. Both are ETFs offered by Vanguard. Yes, the wisdom here comes from JL Collins."
- V Saraf
Read more »

From HumbleDollar Founder Jonathan Clements

Markets

Ignore Valuations?

Make no mistake: Stocks are expensive, with the companies in the S&P 500-index currently at 28 times trailing 12-month reported earnings, offering a dividend…
Read more »

Family

Jonathan, How I Wish You Were Here

Andrew Clements  |  Oct 25, 2026

"Thank you, Linda. Your words mean more than you know. I’ve wondered lately whether my articles were still of interest to readers. Writing helps me work through what I’m feeling, and knowing those reflections help you too gives me encouragement to keep sharing. Thank you for that kindness."
- Andrew Clements
Read more »

Retirement

Roth conversion cash flow

Severly Independent  |  Oct 24, 2026

"I’ve used Boldin and it gives you a lot of options on how you want to model it, by tax rate, highest ending estate balance, IRMMA cliffs,etc"
- Joe
Read more »

In Retirement

Inherited IRA Trap

ArticleJohn Urban  |  Oct 24, 2026

EVERY JANUARY, if you own an IRA and money must come out of it that year, your custodian writes to you. The letter gives you the amount or offers to work it out. We barely read it, but it is doing more than we notice. Most people never miss a required distribution, and the reason is not diligence. It is that somebody tells them. Inherited IRAs are different. The IRS notice that creates the requirement says reporting is not required for the IRAs of deceased owners, and an inherited IRA is exactly that. No letter is owed to the person who inherits, and in many cases none arrives. When nobody tells us anything needs doing, we assume nothing does. Here that assumption is expensive. The question behind the question Everyone remembers the 10-year rule. It answers one question: when does the account have to be empty? It does not answer the one that costs money: does something have to come out this year? That turns on a fact about the person who died. Had they reached the age at which their own distributions had to begin? It is 72 for anyone born before 1951, 73 for those born between 1951 and 1959, and 75 for anyone born in 1960 or later. Take the common case, an adult child inheriting a traditional IRA. If the parent died before reaching that age, nothing has to come out until the account is emptied at the end of year 10. If the parent died on or after it, a required minimum distribution, or RMD, is due every year in the meantime, and the account still has to be empty at the end of year 10. That second case is the one people get wrong. The 10-year rule is widely remembered as permission to leave the money alone until year 10, and for a great many people who inherit, it is not. Other beneficiaries have their own timing, among them a disabled or chronically ill beneficiary, a minor child, and anyone less than 10 years younger than the person who died. Inherited Roth IRAs differ again, and a spouse has choices nobody else has. All of it sits in the SECURE Act and its 2022 successor, which is what to search. Take too little and the shortfall carries an excise tax of 25% of what should have come out, or 10% if you correct it promptly. That is on top of the income tax you owe when the money finally comes out. And there are two ways to trigger it. Taking too little in a year is one. The other is reaching the end of year 10 with money still in the account, because whatever is left on that date is treated as a shortfall too. What four quiet years cost A widow turns 76 the year after her husband dies. He was 78, well past the age his own distributions had to begin. She has Social Security of $36,000, a pension of $24,000, and his IRA, still titled as an inherited account, holding $480,000. She does not need the money, no reminder arrives from the custodian, and so she takes none of it for four years while the account grows at 5%. Because he had already passed that age, and because she left the account titled as inherited, she owes a distribution in every one of those years. At 76 she should have taken $34,043. At 77, $37,895. At 78, $42,000. At 79, $46,694, by which point the untouched balance has grown to $555,660. She has missed $160,631 of required distributions. At 25%, the excise tax on that is $40,158. Corrected in time it would be $16,063. Now the part I expected to be worse than it is. When she corrects, all four distributions come out in a single year, and I assumed that bunching would be the quiet disaster. Spread across four years, the distributions cost her $37,566 in federal income tax. Bunched into one, $38,783. The difference is $1,216. If you have been told the danger of a missed distribution is the bracket you land in when you fix it, check that against your own numbers before believing it. The bigger surprise came from Medicare. The surcharge nobody sees Take the distributions on time and her Medicare surcharge is zero in all four years. Bunch them into a single return and it is $6,355. That bill does not arrive with the tax. Medicare sets your Part B and Part D premiums from your income two years earlier, so the surcharge turns up long after the correction has been filed and forgotten, attached to something that does not look like a tax at all. Add it up. Four quiet years cost her about $47,700 she need not have spent: $40,158 of excise tax, $1,216 of extra income tax from the bunching, and $6,355 of Medicare surcharge. The $37,566 of income tax on the distributions themselves was never avoidable and was never the problem. In none of those four years did anyone write to her. The first letter came from the IRS, years late, and fixing it by then meant amended returns and a Form 5329 for every year. What actually prevents it Not vigilance. Nobody is vigilant about a rule they have not heard of, and the custodian was never obliged to tell you. If you have already inherited, two facts settle almost all of it. The year the person died, and whether by then they had reached the age their own distributions had to begin. Your custodian can tell you how the account is titled. Nobody but you is going to find that second date. And if you are reading this married, with both of you alive and nothing yet owed, you are in the only position from which this is easy. Work out the year each of you reaches that age. For whichever of you dies first, that is the year deciding whether the survivor owes a distribution the year after the death. Write both years down, with a line saying why they matter, and put them with your trust, your will and the beneficiary designations, where the survivor will actually come across them. The account will not remind anyone that a clock started. The only reliable reminder is the one you write down before you need it. A note of thanks The shape of this article came from William Perry, who spent his working years preparing returns and described in a comment thread how these cases reach a preparer. His account of the letter arriving to the widow years later convinced me the annual question deserved a piece of its own. ________________________________________________________________________________ John Urban is the founder of RetireSmartIRA, a retirement tax-planning app. Earlier, he founded GT Nexus, a supply-chain software company acquired by Infor in 2015. He lives in Northern California with his wife, Kathy, and enjoys time with family, travel, reading, Bay Area sports, and the occasional deep dive into the fine print of the tax code.
Read more »

Behavior

Priced as Marked

D.J.  |  Oct 22, 2026

"Sometimes a deal just feels right. Enjoy the new printer!"
- D.J.
Read more »

Estate Plan

Exit Strategy

ArticleDavid Gartland  |  Jul 9, 2024

IF YOU’RE LIKE ME, you aren’t eager to spend down your investments. What fun is that? Aren’t you curious to see how big your portfolio could grow? Of course, you are.

After my wife and I are gone, my son will have dibs on the money we’ve amassed. We’ve set up a special needs trust to provide him with income when we’re no longer around. My son has no siblings, so we needed the trust to make sure he’s taken care of.

But until then, I view our portfolio as a beautiful garden that I need to nurture. I believe many investors are like me, and don’t really enjoy spending. Instead, they cultivate their wealth with an eye to passing it on to their heirs or their favorite causes.

But what about those investors who don’t have anybody lined up to take over their money after they’re gone? We’ve had wealthy celebrities, like Prince and Aretha Franklin, who died without clear instructions for how their estate should be handled.

I don’t understand such neglect. You’ve been caring for your portfolio with the goal of seeing how big it can get before you “kick the bucket.” That’s great. But you also have a responsibility to make sure your efforts don’t go to waste. You should have a plan in place for this thing you’ve enjoyed owning for so long.

Some investors say, “Oh, I don’t care what happens after I’m gone.” That’s the wrong attitude. You owe it to your wealth to see that it’s put to good use after your death. Just find someone or some cause that you feel would benefit from all your hard work.

Maybe your beneficiaries will fritter away your money. Maybe they’ll show respect for what you’ve done and keep your wealth growing. Maybe they’ll put it to good use and help many others with this gift you’ve given.

But no matter how your beneficiaries behave, the important thing is that you do your part—and have a plan for what happens after you’re gone. Once you’ve done that, you can go back to tending to your investment garden and making sure you don’t mess it up for the next owner.

Read more »

Investing

The Trouble With Being Different

Mark Gardner  |  Oct 24, 2026

"Financial websites and cable channels try to manipulate us into reacting to short-term fluctuations that are essentially meaningless noise. I’ve stopped tracking 1/3, and 5-year returns and now focus solely on 10-year investments (approximately 3-5 rebalancing events per my plan) and beyond. It’s incredibly challenging to do so, considering how sophisticated the media algorithms have become!"
- Mark Gardner
Read more »

Advisors

The Time Value of Money

Dan Smith  |  Oct 23, 2026

"I think it may be innate, but still may require a learning process. Like a newborn baby has the innate ability to speak, it takes a long time to fully develop the skill. And some of us talk gooder than others!"
- Dan Smith
Read more »

Markets

Beyond Predictions

ArticleAdam M. Grossman  |  Oct 24, 2026

NATURE ABHORS a vacuum. That’s well known, but when it comes to investing, this poses a particular problem. Why? In the absence of anyone having the ability to predict the future, commentators and prognosticators are happy to step in with stories of their own. The reality, though, is that no matter how rigorous anyone’s analysis might be, no one can know for sure what the future holds, for the economy, for the stock market or for any individual investment. Rationally, we know this, but still it’s an uphill battle, because market commentators have at their disposal an endless library of smart-sounding anecdotes and aphorisms to support their views. And they can be convincing. To see how this works, we can look at some of today’s most frequently debated questions through the lens of these storytellers.  The first question on many investors’ minds: Is the stock market skating on thin ice? For some, this question isn’t difficult to answer. They point to the Cyclically-Adjusted Price-to-Earnings ratio (CAPE). Developed by Robert Shiller, a Nobel laureate, the CAPE ratio is a respected measure of market valuation. Today, it’s at its highest level since the market peak in 2000 and much higher even than it was in 1929, just before the crash. Compounding these concerns, there’s worry that traditional valuation methods like the CAPE may even be underestimating market risk. Companies in the AI ecosystem are of particular concern because of the ways in which they’re doing business with each other. Nvidia, for example, has announced an investment of as much as $100 billion into OpenAI at the same time that OpenAI is spending billions on Nvidia’s chips. Nvidia has invested in dozens of other AI-related companies, helping further drive demand for its own chips. This calls into question many companies’ earnings. If they’re passing the same dollars around, to some extent, should those dollars be counted as sustainable revenue, or is it a game of financial musical chairs that may come to an end? It’s an open question, but the optics of these deals buttress the argument that the market is out over its skis. Market bears also like to point to a famous Wall Street anecdote: According to lore, someone once asked J.P. Morgan to share the secret of his success. His reply: “I made all my money selling too early.” Caution, in other words, may be rewarded. Especially in light of the CAPE ratio and other concerns, it sounds like it might be wise advice to take a more conservative tack with one’s investments. But this is where the anecdotes run headlong into the data. According to a 2023 study titled “Selling Fast and Buying Slow,” a key driver of mutual fund underperformance is that fund managers tend to make errors in timing their sales. Perhaps J.P. Morgan did benefit by shrewdly selling before market downturns, but according to the data, that’s not the experience of most professional investors. Who’s right in this debate? My view is that proponents of each argument have a legitimate point. The problem, though, is that what happens in the future can’t be decided on any given set of data. Instead, where things ultimately go will depend on a more complicated interplay among all of the factors out there, from AI to interest rates to elections, geopolitics, and innumerable other factors we may not even be thinking about. For that reason, we shouldn’t put too much stock in definitive-sounding predictions. A similar debate is swirling around U.S. Treasury bonds. In finance textbooks, U.S. government bonds are referred to as the “riskless asset,” owing to the U.S. economy’s status as the largest and most productive in the world. Because of that, the Treasury has historically been able to borrow as much as it needed each year. Indeed, the government’s debt load topped $40 trillion a few months ago, and its nearly flawless credit rating has allowed Congress to continue financing multi-trillion dollar deficits each year. It’s for these reasons that some commentators see it as irrational to worry about the U.S. government’s financial position. One recent book titled The Deficit Myth argued that the government could, more or less, print as much money as it wished. That’s one line of argument. But here too, the stories seem to be in conflict with the data. In the first eight months of this year, the Federal Reserve held rates steady, but despite that, market interest rates rose almost continuously over that period, defying the Fed. Why would market interest rates rise when the Fed hadn’t made any moves at all? One explanation is that bond investors are growing more concerned about the federal government’s fiscal health. In round numbers, the government now spends about $7.5 trillion per year but is only taking in about $5.5 trillion in revenue, and Congress doesn’t seem to be focusing in any serious way on addressing that gap. Taken together, these data points suggest that concerns about deficits are definitely not a myth, and that the notion of a “riskless” asset carries with it no guarantees. As an individual investor, how should you respond to these sorts of debates? This is the simple formula I suggest: First, don’t make changes to your finances in response to any given commentator, since, as we’ve seen here, there often exists an equally articulate, but opposite, point of view on any given question.  At the same time, I wouldn’t entirely tune out the prognosticators. Instead, I would take the time to closely examine your own finances and run stress tests to see how your plan might be affected under each of the various scenarios they predict. Then see if there’s a way to diversify your holdings to protect against those potential outcomes.  Diversification is probably the simplest rule in personal finance but may be the most valuable. Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and check out his earlier articles.
Read more »

Behavior

Monopoly

D.J.  |  Oct 27, 2026

Be the first to comment.
Read more »

In Retirement

The pension conundrum and a solution

R Quinn  |  Oct 26, 2026

"Mark, in response to your question, I'm not thinking of people like your wife (20 years each with two employers, good for her!!), but for people who, for whatever reason, don't enjoy that type of stability and longevity in their employment. And mindful that at age 30, one doesn't know where one will be, pension-wise, at age 65. (I recognize that circumstances may be different in the UK.)"
- Partly Sunny
Read more »

In Retirement

Social Security “Haircuts”

achnk53  |  Oct 25, 2026

"Dan, that is the way I read Richard's comments also."
- Dave Melick
Read more »

Investing

Do I really need International funds in my portfolio? I say no.

Bruce Roberts  |  Oct 26, 2026

"For a long time I have followed the logic that major US companies in S&P derive significant revenues from their international operations. But recently, I have started moving towards a still more diversified portfolio. Rather than VTI, based solely on US stocks, I have moved towards VT. Both are ETFs offered by Vanguard. Yes, the wisdom here comes from JL Collins."
- V Saraf
Read more »

From HumbleDollar Founder Jonathan Clements

Markets

Ignore Valuations?

Make no mistake: Stocks are expensive, with the companies in the S&P 500-index currently at 28 times trailing 12-month reported earnings, offering a dividend…
Read more »

Family

Jonathan, How I Wish You Were Here

Andrew Clements  |  Oct 25, 2026

"Thank you, Linda. Your words mean more than you know. I’ve wondered lately whether my articles were still of interest to readers. Writing helps me work through what I’m feeling, and knowing those reflections help you too gives me encouragement to keep sharing. Thank you for that kindness."
- Andrew Clements
Read more »

Retirement

Roth conversion cash flow

Severly Independent  |  Oct 24, 2026

"I’ve used Boldin and it gives you a lot of options on how you want to model it, by tax rate, highest ending estate balance, IRMMA cliffs,etc"
- Joe
Read more »

In Retirement

Inherited IRA Trap

ArticleJohn Urban  |  Oct 24, 2026

EVERY JANUARY, if you own an IRA and money must come out of it that year, your custodian writes to you. The letter gives you the amount or offers to work it out. We barely read it, but it is doing more than we notice. Most people never miss a required distribution, and the reason is not diligence. It is that somebody tells them. Inherited IRAs are different. The IRS notice that creates the requirement says reporting is not required for the IRAs of deceased owners, and an inherited IRA is exactly that. No letter is owed to the person who inherits, and in many cases none arrives. When nobody tells us anything needs doing, we assume nothing does. Here that assumption is expensive. The question behind the question Everyone remembers the 10-year rule. It answers one question: when does the account have to be empty? It does not answer the one that costs money: does something have to come out this year? That turns on a fact about the person who died. Had they reached the age at which their own distributions had to begin? It is 72 for anyone born before 1951, 73 for those born between 1951 and 1959, and 75 for anyone born in 1960 or later. Take the common case, an adult child inheriting a traditional IRA. If the parent died before reaching that age, nothing has to come out until the account is emptied at the end of year 10. If the parent died on or after it, a required minimum distribution, or RMD, is due every year in the meantime, and the account still has to be empty at the end of year 10. That second case is the one people get wrong. The 10-year rule is widely remembered as permission to leave the money alone until year 10, and for a great many people who inherit, it is not. Other beneficiaries have their own timing, among them a disabled or chronically ill beneficiary, a minor child, and anyone less than 10 years younger than the person who died. Inherited Roth IRAs differ again, and a spouse has choices nobody else has. All of it sits in the SECURE Act and its 2022 successor, which is what to search. Take too little and the shortfall carries an excise tax of 25% of what should have come out, or 10% if you correct it promptly. That is on top of the income tax you owe when the money finally comes out. And there are two ways to trigger it. Taking too little in a year is one. The other is reaching the end of year 10 with money still in the account, because whatever is left on that date is treated as a shortfall too. What four quiet years cost A widow turns 76 the year after her husband dies. He was 78, well past the age his own distributions had to begin. She has Social Security of $36,000, a pension of $24,000, and his IRA, still titled as an inherited account, holding $480,000. She does not need the money, no reminder arrives from the custodian, and so she takes none of it for four years while the account grows at 5%. Because he had already passed that age, and because she left the account titled as inherited, she owes a distribution in every one of those years. At 76 she should have taken $34,043. At 77, $37,895. At 78, $42,000. At 79, $46,694, by which point the untouched balance has grown to $555,660. She has missed $160,631 of required distributions. At 25%, the excise tax on that is $40,158. Corrected in time it would be $16,063. Now the part I expected to be worse than it is. When she corrects, all four distributions come out in a single year, and I assumed that bunching would be the quiet disaster. Spread across four years, the distributions cost her $37,566 in federal income tax. Bunched into one, $38,783. The difference is $1,216. If you have been told the danger of a missed distribution is the bracket you land in when you fix it, check that against your own numbers before believing it. The bigger surprise came from Medicare. The surcharge nobody sees Take the distributions on time and her Medicare surcharge is zero in all four years. Bunch them into a single return and it is $6,355. That bill does not arrive with the tax. Medicare sets your Part B and Part D premiums from your income two years earlier, so the surcharge turns up long after the correction has been filed and forgotten, attached to something that does not look like a tax at all. Add it up. Four quiet years cost her about $47,700 she need not have spent: $40,158 of excise tax, $1,216 of extra income tax from the bunching, and $6,355 of Medicare surcharge. The $37,566 of income tax on the distributions themselves was never avoidable and was never the problem. In none of those four years did anyone write to her. The first letter came from the IRS, years late, and fixing it by then meant amended returns and a Form 5329 for every year. What actually prevents it Not vigilance. Nobody is vigilant about a rule they have not heard of, and the custodian was never obliged to tell you. If you have already inherited, two facts settle almost all of it. The year the person died, and whether by then they had reached the age their own distributions had to begin. Your custodian can tell you how the account is titled. Nobody but you is going to find that second date. And if you are reading this married, with both of you alive and nothing yet owed, you are in the only position from which this is easy. Work out the year each of you reaches that age. For whichever of you dies first, that is the year deciding whether the survivor owes a distribution the year after the death. Write both years down, with a line saying why they matter, and put them with your trust, your will and the beneficiary designations, where the survivor will actually come across them. The account will not remind anyone that a clock started. The only reliable reminder is the one you write down before you need it. A note of thanks The shape of this article came from William Perry, who spent his working years preparing returns and described in a comment thread how these cases reach a preparer. His account of the letter arriving to the widow years later convinced me the annual question deserved a piece of its own. ________________________________________________________________________________ John Urban is the founder of RetireSmartIRA, a retirement tax-planning app. Earlier, he founded GT Nexus, a supply-chain software company acquired by Infor in 2015. He lives in Northern California with his wife, Kathy, and enjoys time with family, travel, reading, Bay Area sports, and the occasional deep dive into the fine print of the tax code.
Read more »

Behavior

Priced as Marked

D.J.  |  Oct 22, 2026

"Sometimes a deal just feels right. Enjoy the new printer!"
- D.J.
Read more »

Markets

Beyond Predictions

ArticleAdam M. Grossman  |  Oct 24, 2026

NATURE ABHORS a vacuum. That’s well known, but when it comes to investing, this poses a particular problem. Why? In the absence of anyone having the ability to predict the future, commentators and prognosticators are happy to step in with stories of their own. The reality, though, is that no matter how rigorous anyone’s analysis might be, no one can know for sure what the future holds, for the economy, for the stock market or for any individual investment. Rationally, we know this, but still it’s an uphill battle, because market commentators have at their disposal an endless library of smart-sounding anecdotes and aphorisms to support their views. And they can be convincing. To see how this works, we can look at some of today’s most frequently debated questions through the lens of these storytellers.  The first question on many investors’ minds: Is the stock market skating on thin ice? For some, this question isn’t difficult to answer. They point to the Cyclically-Adjusted Price-to-Earnings ratio (CAPE). Developed by Robert Shiller, a Nobel laureate, the CAPE ratio is a respected measure of market valuation. Today, it’s at its highest level since the market peak in 2000 and much higher even than it was in 1929, just before the crash. Compounding these concerns, there’s worry that traditional valuation methods like the CAPE may even be underestimating market risk. Companies in the AI ecosystem are of particular concern because of the ways in which they’re doing business with each other. Nvidia, for example, has announced an investment of as much as $100 billion into OpenAI at the same time that OpenAI is spending billions on Nvidia’s chips. Nvidia has invested in dozens of other AI-related companies, helping further drive demand for its own chips. This calls into question many companies’ earnings. If they’re passing the same dollars around, to some extent, should those dollars be counted as sustainable revenue, or is it a game of financial musical chairs that may come to an end? It’s an open question, but the optics of these deals buttress the argument that the market is out over its skis. Market bears also like to point to a famous Wall Street anecdote: According to lore, someone once asked J.P. Morgan to share the secret of his success. His reply: “I made all my money selling too early.” Caution, in other words, may be rewarded. Especially in light of the CAPE ratio and other concerns, it sounds like it might be wise advice to take a more conservative tack with one’s investments. But this is where the anecdotes run headlong into the data. According to a 2023 study titled “Selling Fast and Buying Slow,” a key driver of mutual fund underperformance is that fund managers tend to make errors in timing their sales. Perhaps J.P. Morgan did benefit by shrewdly selling before market downturns, but according to the data, that’s not the experience of most professional investors. Who’s right in this debate? My view is that proponents of each argument have a legitimate point. The problem, though, is that what happens in the future can’t be decided on any given set of data. Instead, where things ultimately go will depend on a more complicated interplay among all of the factors out there, from AI to interest rates to elections, geopolitics, and innumerable other factors we may not even be thinking about. For that reason, we shouldn’t put too much stock in definitive-sounding predictions. A similar debate is swirling around U.S. Treasury bonds. In finance textbooks, U.S. government bonds are referred to as the “riskless asset,” owing to the U.S. economy’s status as the largest and most productive in the world. Because of that, the Treasury has historically been able to borrow as much as it needed each year. Indeed, the government’s debt load topped $40 trillion a few months ago, and its nearly flawless credit rating has allowed Congress to continue financing multi-trillion dollar deficits each year. It’s for these reasons that some commentators see it as irrational to worry about the U.S. government’s financial position. One recent book titled The Deficit Myth argued that the government could, more or less, print as much money as it wished. That’s one line of argument. But here too, the stories seem to be in conflict with the data. In the first eight months of this year, the Federal Reserve held rates steady, but despite that, market interest rates rose almost continuously over that period, defying the Fed. Why would market interest rates rise when the Fed hadn’t made any moves at all? One explanation is that bond investors are growing more concerned about the federal government’s fiscal health. In round numbers, the government now spends about $7.5 trillion per year but is only taking in about $5.5 trillion in revenue, and Congress doesn’t seem to be focusing in any serious way on addressing that gap. Taken together, these data points suggest that concerns about deficits are definitely not a myth, and that the notion of a “riskless” asset carries with it no guarantees. As an individual investor, how should you respond to these sorts of debates? This is the simple formula I suggest: First, don’t make changes to your finances in response to any given commentator, since, as we’ve seen here, there often exists an equally articulate, but opposite, point of view on any given question.  At the same time, I wouldn’t entirely tune out the prognosticators. Instead, I would take the time to closely examine your own finances and run stress tests to see how your plan might be affected under each of the various scenarios they predict. Then see if there’s a way to diversify your holdings to protect against those potential outcomes.  Diversification is probably the simplest rule in personal finance but may be the most valuable. Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and check out his earlier articles.
Read more »

Free Newsletter

Get Educated

Manifesto

Oct 25, 2026

NO. 59: MOST FOLKS should avoid alternative investments. Yes, they promise returns uncorrelated with the stock market and gains when shares are tumbling. But isn’t that why we own bonds?

humans

Oct 27, 2026

NO. 18: SPENDING can give us a thrill. Just had a rough day? Others may cheer themselves up with comfort food or a beer. But for some, the antidote is to make a purchase or two, because this spending lifts their spirits. But thanks to hedonic adaptation, the thrill doesn’t last long and, taken to an extreme, such spending could cause financial problems.

Truths

Oct 27, 2026

NO. 14: IT ISN’T SO BAD—as long as we expect it. What’s unnerving is when our investments perform far worse than we ever imagined. We aren’t bothered by 1% stock-market losses—that can happen on an ordinary trading day—but we’re alarmed by the idea that the $1 share price of our money-market mutual fund might “break the buck” and fall 1% to 99 cents.

think

Oct 26, 2026

VOLATILITY. A volatile portfolio isn’t just nerve-racking. It also hurts compounding. Suppose portfolio No. 1 gains 10% this year and next, while No. 2 climbs 30%, only to lose 10% in the second year. The portfolios might appear to have the same return. But in fact, No. 1 would gain a cumulative 21%, vs. 17% for No. 2. Want to reduce volatility? The key is diversification.

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Manifesto

Oct 25, 2026

NO. 59: MOST FOLKS should avoid alternative investments. Yes, they promise returns uncorrelated with the stock market and gains when shares are tumbling. But isn’t that why we own bonds?

Spotlight: Careers

The Wages of Success

normr60189   |  Aug 25, 2025

I worked and earned income from 1963 to 2022. I always saved a portion of my earnings. Some was “parked” in real estate, some in the stock market, some in bonds and some in a traditional savings account. Every dollar I saved represented many hours…
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One Piece Of Paper

Andrew Clements   |  Aug 5, 2026

Looking back, it's remarkable how much of my life depended on one government issued card. My twin brother Nick and I had no way of knowing that becoming permanent residents of the United States would eventually lead us to careers we never expected, a business…
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MONTH TWO AND ITS NOT GOING WELL

Byjove   |  Oct 19, 2025

I found a dead cockroach, feet up in the air, in the kitchen, and it struck me that I haven't done anything productive either over the last two months. Even sleeping late has proven impossible, thanks to my Shih Tzu. My efforts to start a…
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Never Working a Day in My Life

Cecilia Beverly   |  Sep 5, 2025

I spent most of my early 20s not knowing what I wanted to do with my life – I lost track of how many times I changed my major! After graduating, I moved to Japan and spent a couple of years teaching English and exploring…
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Developing Champions in your Career and Life

Raghu   |  Mar 14, 2026

I have been a long time reader of Humble Dollar and the excellent forum posts. I have been contributing a "Friday Thoughts" articles on my Linkedin page for several years. Today I want to post one of these articles for our youngsters on the importance…
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Retirement, One Year On

DrLefty   |  Jul 1, 2026

Today marks the one-year anniversary of my retirement after a 35-year career as a university professor. Since I wrote it about it several times leading up to that day, and another one after six months, I thought I'd add some thoughts about the first year…
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Spotlight: Lim

Hard to Follow

John Lim   |  May 21, 2022

"BUY LOW, SELL HIGH." This is probably the most famous investment adage. It sounds so simple and commonsensical—a sure path to success. Like so many investing truisms, however, following it is easier said than done. For one thing, how do we really know when we’re buying low? When it comes to a pair of jeans or a laptop computer, we…
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Lords of Easy Money

John Lim   |  May 6, 2022

THE FEDERAL RESERVE has a daunting responsibility. Among its jobs is “to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.” This is commonly referred to as its dual mandate of maximum employment and price stability. Yet those two aims are often at odds. That’s because of the inverse relationship between unemployment and inflation, embodied…
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Funny Money

John Lim   |  May 5, 2022

DO YOU SEE THINGS clearly when it comes to money? Here’s a test to find out. Which of the following scenarios would you prefer? A 5% raise, but the inflation rate is 10%. A 3% salary cut, but the inflation rate is 0%. If you chose the 5% pay raise, you’ve fallen victim to a “money illusion.” This term describes…
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Fed Up

John Lim   |  Nov 13, 2021

IS THE U.S. ECONOMY strong or weak? If you believe it’s strong—and apparently many investors do, judging by the U.S. stock market’s all-time highs—why is the Federal Reserve keeping the federal funds rate at zero? These days, it seems like we take the Fed’s policy of 0% short-term interest rates for granted. Yet such policy measures are truly extraordinary and…
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Yielding Clarity

John Lim   |  Feb 6, 2019

THE YIELD CURVE HAS lately received a lot of press. Specifically, the inversion of the yield curve has many people worried that a recession is around the corner. I’ve been spending a lot of time recently thinking about the yield curve. I need to get a life, right? You may be asking yourself, “Why should I even care about the…
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Fill ’Er Up

John Lim   |  Dec 6, 2021

I OWN JUST TWO individual stocks. One is Wells Fargo, which I’ve discussed before. The other is Total, recently renamed TotalEnergies, a major oil company headquartered in France. I was initially attracted to Total by its generous dividend and enormous underperformance in 2020. Yes, great underperformance—not outperformance—often piques my interest. Of course, declining stock prices and generous dividend yields go…
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