Inflation in the area of 4% (3.9% to be exact)
Unemployment 5.2% (I hope it's only that)
Yes, by definition a recession, but those in power will take to the airwaves to claim that the old definitions don't hold true this time, and we should trust them.
Perhaps glass half full, but the S&P and NASDAQ are largely stagnant through the remainder of the year (I hope that's as bad as it gets)
Foreign stocks will NOT outperform US. Exception may be China, otherwise this is self-inflicted mutually assured financial destruction.
Value? No.
Treasury yield. By end of year 5% in an attempt to shift sentiments. My guess is like everyone else, a guess. Perhaps even too optimistic.
Agreed. A bit unfortunate that there doesn't seem a wealth (no pun intended) of objective, trustworthy, and reliable advice about getting and staying healthy that isn't a cover for someone else's snake oil or paid influencer scheme. And I greatly worry that the current US climate is such that the door to those charlatans has been opened wide, with no legitimate arbiter of truth to present a (relatively) non-biased counterpoint.
I think the non-monetary considerations impacting inheritance and legacy greatly overwhelm the effects of the money itself. I suppose it's somewhat natural for parents to want to have some influence on their children's lives. This is most obvious when they're young kids, but although there are legal definitions of adulthood they don't tend to apply to inheritance issues, therefore the existence of trusts and such. But ultimately most children grow to simply model the behaviors and tendencies of the adults around them, and in some cases it is not their parents, but instead proxies that take the place of adult role models, some good, some less ideal. For example, growing up in a household where wealth was obtained by hard work, good choices, and a bit of good fortune might imprint on the next generation something different than ones raised by a variety of paid proxies and the like. I suspect it's easier for the former to better manage an inheritance, as is can often essentially be, "business as usual," vs a windfall meant to be spent expeditiously. In either case, from the perspective of parents, there probably is a time where one needs to "let go," and maybe from beyond the grave is that time.
Love the topic. I've been called frugal by others for over 40 years (heck, I've probably been called "cheap" for longer than that). Defined by others, they would view my expenditures as lower than I could afford, and they'd be absolutely correct. But i've never bought or purchased for myself with the intent of influencing what others think, so in my own assessment that defines me as frugal with a slight topping of arrogance (as I can quickly and easily acknowledge circumstances where a monetary investment on my part; cars, dress, home, etc., would have likely had a positive impact on how I was viewed by others, with a resultant monetary benefit. But I've always squashed that perspective). My best definition of frugal is "spending mindfully." So regardless of wealth or net worth, spending on things (not necessarily material) that provide a measure of value, separate from the absolute cost of said thing. Jon Clements just wrote about his experience on a cruise ship, and paying extra for premium services. I completely agree with his sentiment. If you can afford it (ie not putting more burden on CC dept), and value the services received (knowing the relative savings of not spending that money elsewhere), it can be both a luxurious yet (relatively) frugal choice. My personal analogy to that is on the occasion that I opt for a "club level" option at a hotel, where while I may be paying extra, I've purchased the freedom to come and go as I please, enjoy drinks, snacks, and relaxation on my own time (vs going to a restaurant or bar). Nowadays as a "senior," that's further a luxury as either my or my spouse's credit accounts provides that without any additional cost, so it checks all the boxes of frugality.
Of that list, it's interesting that while there are items that are directly out your control, such as the stock market, cuts to SS, and long term care costs, ALL of them can be controlled or mitigated with proper advance planning. THAT would probably be a good definition of wealth IMO, the ability to have established contingencies to that list. Honestly (I'm just reading the list over and over) I think I'm close, if not already there. That's quite reassuring.
Thanks Adam. Not unexpectedly well-reasoned. There's no single right answer, and in particular I really liked how you explained why some may choose an index leaning more strongly towards large US companies, given what has largely been a nearly 75 year boom post WW2. Tough to argue on a macro level that, unlike the case pre WW2 (so, including the great depression), that the US has emerged as the singular superpower. This may change in the next century with China, but that story is yet to be written.
Provocative as always Richard. But regardless of how they got there, there is a large swath of seniors or soon-to-be seniors that are at the doorstep and realize that they're objectively unlikely to support themselves for a significant duration in retirement, at least at the standard of living they enjoyed during their working years. As Richard points out, this can be due to a myriad of reasons both internal and external, but the end product remains, a group of seniors with simply not enough money. I find two likely and interlinked primary reasons. The first has been proven with time. The transition from defined benefit plans (e.g., pension plans) to self-directed 401(k)s is the biggie. Left to their own devices, even with ample direction, warnings, and caveats, it's simply human nature to think short term (i.e, immediate gratification) over long (i.e., a retirement of unknown duration). Steps have been taken by government in recent years to address this (e.g., automatic enrollment in 401(k)s), but for probably 2-3 decades of seniors the damage is already done). The second is not a revolutionary thing, but really a evolving state of the country. Think of how many multi-generational households you know in the US? I personally can think of none, and the closest I can relate to is my own extended family, and the only reason that doesn't exist for me currently is that the older generation has all passed. But the point is that seniors are essentially on their own financially, leaving for the most part SS and whatever individual retirement savings a senior accumulates. And the net result? For many that simply falls short of the mark. So what does my crystal ball say? I think SS doesn't get cut, period. And the part that will impact the entire economy? Sorry, but I think we're going to see for a few decades that economically challenged seniors will be a drag on the American economy.
I'm here right now (Jon and I are almost exactly the same age). I would change, "happy," to, "content," as I simply think that's a more accurate description of the retiree's I know in a similar life-stage. "Happiness," when you hit your sixties seems so much more of an episodic thing, while contentment is an acceptance, when possible, of being, "happy enough." 6 decades I think most would agree is enough that the fruits of a lifetime of work and decisions will have set a pretty firm trend line, like it or not. For some, and I would include myself it this group, I can look back and see the trade offs made along the path to today, both intentional as well as the ones introduced by fate and/or chance. Could it/I have done better? Obviously, but equally obviously I could have done much, much worse. Hence the idea of, "contentment." There's a oft-quoted phrase, perhaps a misattribution, to the author Kurt Vonnegut, where's he at a party at some rich guy's house where he answers a question about contentment by saying he's rich in that understands the concept of, "enough." I remind myself of this often. But to Jon's initial question. Yes, "enough," wealth to not have to worry, that's important. I would definitely add, "purpose," to what makes me content, understanding that it's different for everyone, and can intersect with the other bullets like companionship and faith. Health is underappreciated, but again, in retirement, often the years of neglect are increasingly manifest in less desirable ways.
A great premise, and yes, a challenge to implement with intent. Agreed that cutting SS benefits is essentially a political non-starter, so let's start by taking that off the table. Seniors are to some degree already being "forced" to continue working as a consequence of the current economy and inflation; I can only think this continues further as the downstream impacts of the transition from defined benefit programs such as pensions are replaced by retirees with underfunded 401(k) plans. But government can aid that momentum by incentivizing expanding the demand for workers, and further restricting the ability of companies to bypass hiring of American workers. While obvious, the rising tide of a growing economy powered by workers, vs. the capital gains from tech and intellectual property, will not only help the SS situation but put the US on a sturdier economic footing.
Comments
Inflation in the area of 4% (3.9% to be exact) Unemployment 5.2% (I hope it's only that) Yes, by definition a recession, but those in power will take to the airwaves to claim that the old definitions don't hold true this time, and we should trust them. Perhaps glass half full, but the S&P and NASDAQ are largely stagnant through the remainder of the year (I hope that's as bad as it gets) Foreign stocks will NOT outperform US. Exception may be China, otherwise this is self-inflicted mutually assured financial destruction. Value? No. Treasury yield. By end of year 5% in an attempt to shift sentiments. My guess is like everyone else, a guess. Perhaps even too optimistic.
Post: How’s Your Crystal Ball? By Jonathan Clements
Link to comment from April 5, 2025
Agreed. A bit unfortunate that there doesn't seem a wealth (no pun intended) of objective, trustworthy, and reliable advice about getting and staying healthy that isn't a cover for someone else's snake oil or paid influencer scheme. And I greatly worry that the current US climate is such that the door to those charlatans has been opened wide, with no legitimate arbiter of truth to present a (relatively) non-biased counterpoint.
Post: I don’t feel comfortable being “wealthy”
Link to comment from April 5, 2025
I think the non-monetary considerations impacting inheritance and legacy greatly overwhelm the effects of the money itself. I suppose it's somewhat natural for parents to want to have some influence on their children's lives. This is most obvious when they're young kids, but although there are legal definitions of adulthood they don't tend to apply to inheritance issues, therefore the existence of trusts and such. But ultimately most children grow to simply model the behaviors and tendencies of the adults around them, and in some cases it is not their parents, but instead proxies that take the place of adult role models, some good, some less ideal. For example, growing up in a household where wealth was obtained by hard work, good choices, and a bit of good fortune might imprint on the next generation something different than ones raised by a variety of paid proxies and the like. I suspect it's easier for the former to better manage an inheritance, as is can often essentially be, "business as usual," vs a windfall meant to be spent expeditiously. In either case, from the perspective of parents, there probably is a time where one needs to "let go," and maybe from beyond the grave is that time.
Post: Giving Advice
Link to comment from April 5, 2025
Love the topic. I've been called frugal by others for over 40 years (heck, I've probably been called "cheap" for longer than that). Defined by others, they would view my expenditures as lower than I could afford, and they'd be absolutely correct. But i've never bought or purchased for myself with the intent of influencing what others think, so in my own assessment that defines me as frugal with a slight topping of arrogance (as I can quickly and easily acknowledge circumstances where a monetary investment on my part; cars, dress, home, etc., would have likely had a positive impact on how I was viewed by others, with a resultant monetary benefit. But I've always squashed that perspective). My best definition of frugal is "spending mindfully." So regardless of wealth or net worth, spending on things (not necessarily material) that provide a measure of value, separate from the absolute cost of said thing. Jon Clements just wrote about his experience on a cruise ship, and paying extra for premium services. I completely agree with his sentiment. If you can afford it (ie not putting more burden on CC dept), and value the services received (knowing the relative savings of not spending that money elsewhere), it can be both a luxurious yet (relatively) frugal choice. My personal analogy to that is on the occasion that I opt for a "club level" option at a hotel, where while I may be paying extra, I've purchased the freedom to come and go as I please, enjoy drinks, snacks, and relaxation on my own time (vs going to a restaurant or bar). Nowadays as a "senior," that's further a luxury as either my or my spouse's credit accounts provides that without any additional cost, so it checks all the boxes of frugality.
Post: Is frugality all it’s cracked up to be? A lifetime of frugality, I have claimed that, Jonathan has written it. Many comments on HD have also made that claim, but is it true? RDQ
Link to comment from March 23, 2025
Of that list, it's interesting that while there are items that are directly out your control, such as the stock market, cuts to SS, and long term care costs, ALL of them can be controlled or mitigated with proper advance planning. THAT would probably be a good definition of wealth IMO, the ability to have established contingencies to that list. Honestly (I'm just reading the list over and over) I think I'm close, if not already there. That's quite reassuring.
Post: What Worries You? By Jonathan Clements
Link to comment from March 23, 2025
Thanks Adam. Not unexpectedly well-reasoned. There's no single right answer, and in particular I really liked how you explained why some may choose an index leaning more strongly towards large US companies, given what has largely been a nearly 75 year boom post WW2. Tough to argue on a macro level that, unlike the case pre WW2 (so, including the great depression), that the US has emerged as the singular superpower. This may change in the next century with China, but that story is yet to be written.
Post: Index Three Ways
Link to comment from March 22, 2025
Provocative as always Richard. But regardless of how they got there, there is a large swath of seniors or soon-to-be seniors that are at the doorstep and realize that they're objectively unlikely to support themselves for a significant duration in retirement, at least at the standard of living they enjoyed during their working years. As Richard points out, this can be due to a myriad of reasons both internal and external, but the end product remains, a group of seniors with simply not enough money. I find two likely and interlinked primary reasons. The first has been proven with time. The transition from defined benefit plans (e.g., pension plans) to self-directed 401(k)s is the biggie. Left to their own devices, even with ample direction, warnings, and caveats, it's simply human nature to think short term (i.e, immediate gratification) over long (i.e., a retirement of unknown duration). Steps have been taken by government in recent years to address this (e.g., automatic enrollment in 401(k)s), but for probably 2-3 decades of seniors the damage is already done). The second is not a revolutionary thing, but really a evolving state of the country. Think of how many multi-generational households you know in the US? I personally can think of none, and the closest I can relate to is my own extended family, and the only reason that doesn't exist for me currently is that the older generation has all passed. But the point is that seniors are essentially on their own financially, leaving for the most part SS and whatever individual retirement savings a senior accumulates. And the net result? For many that simply falls short of the mark. So what does my crystal ball say? I think SS doesn't get cut, period. And the part that will impact the entire economy? Sorry, but I think we're going to see for a few decades that economically challenged seniors will be a drag on the American economy.
Post: Quinn rants: Senior citizens are greedy. We take too much
Link to comment from March 2, 2025
I'm here right now (Jon and I are almost exactly the same age). I would change, "happy," to, "content," as I simply think that's a more accurate description of the retiree's I know in a similar life-stage. "Happiness," when you hit your sixties seems so much more of an episodic thing, while contentment is an acceptance, when possible, of being, "happy enough." 6 decades I think most would agree is enough that the fruits of a lifetime of work and decisions will have set a pretty firm trend line, like it or not. For some, and I would include myself it this group, I can look back and see the trade offs made along the path to today, both intentional as well as the ones introduced by fate and/or chance. Could it/I have done better? Obviously, but equally obviously I could have done much, much worse. Hence the idea of, "contentment." There's a oft-quoted phrase, perhaps a misattribution, to the author Kurt Vonnegut, where's he at a party at some rich guy's house where he answers a question about contentment by saying he's rich in that understands the concept of, "enough." I remind myself of this often. But to Jon's initial question. Yes, "enough," wealth to not have to worry, that's important. I would definitely add, "purpose," to what makes me content, understanding that it's different for everyone, and can intersect with the other bullets like companionship and faith. Health is underappreciated, but again, in retirement, often the years of neglect are increasingly manifest in less desirable ways.
Post: Who’s Happy?
Link to comment from March 2, 2025
A great premise, and yes, a challenge to implement with intent. Agreed that cutting SS benefits is essentially a political non-starter, so let's start by taking that off the table. Seniors are to some degree already being "forced" to continue working as a consequence of the current economy and inflation; I can only think this continues further as the downstream impacts of the transition from defined benefit programs such as pensions are replaced by retirees with underfunded 401(k) plans. But government can aid that momentum by incentivizing expanding the demand for workers, and further restricting the ability of companies to bypass hiring of American workers. While obvious, the rising tide of a growing economy powered by workers, vs. the capital gains from tech and intellectual property, will not only help the SS situation but put the US on a sturdier economic footing.
Post: Solve This Problem by Jonathan Clements
Link to comment from March 2, 2025
Again, much appreciation for the impact you've made in many lives with your writing.
Post: Four Thoughts
Link to comment from March 1, 2025