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Don’t Read This

Jonathan Clements  |  November 18, 2016

THE MARKET for intelligent financial writing is, alas, surprisingly small. Why? I believe there are three culprits.

First, many of us don’t care enough about our future selves. Sure, we care somewhat—but not so much that we’ll spend less today, let alone educate ourselves about how to prepare for retirement and other distant goals. Just check out the most popular personal-finance blogs. They focus on topics like coupons, credit cards and juggling debt. Most of us, it seems, are just trying to get by, not get ahead.

Second, we want to believe in magic. Reams of research show conclusively that most investors—professional and amateur—trail the market averages. Yet an article with “10 stocks to buy now” will garner far more eyeballs than a piece on building a globally diversified index-fund portfolio.

Third, we associate sophistication with complexity. But in the financial world, complexity is usually a ruse to bamboozle and fleece investors. Exhibit A: Hedge funds, cash-value life insurance and variable annuities with living benefits, all of which entail exorbitant costs.

The reality is, managing money is best when it is simplest. And yet, if you take the financial world, strip out the nonsense, focus on the simple truths and make them understandable to everyday Americans, readers will complain that “I knew that already” or “that’s obvious”—and then head off in search of strategies with greater bragging rights and lower return potential.

You can sometimes sidestep such complaints by slapping a little lipstick on the pig. With a catchy headline and clever writing, you might convince folks to save more, pay down debt and abandon efforts to beat the stock market averages.

For those who want to read intelligent financial writing, there are still plenty of fine publications, including The New York Times, The Wall Street Journal, Kiplinger’s Personal Finance and Money magazine. But the pages and the number of reporters stacked against sensible personal-finance coverage seem to shrink every year. To be sure, there are some great bloggers who have taken up some of the slack, and you can find fascinating finance conversations every day on Bogleheads.org.

Maybe I’m just being whiny and unrealistic. (It’s been known to happen.) The market for intelligent financial writing has probably always been small. Still, we need it to grow. Thanks to increasing longevity, weakening job security, disappearing pension plans and the rise of 401(k)s, Americans are more responsible for their financial future than ever before—and yet there’s scant evidence we’re any more financially savvy.

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