My first decade of work in the financial biz was during the 70's, which was considered a lost decade due to very low market returns 1970-80. Market returns are but one factor. What about the rate of inflation and 10 year bond yields? During the 70's, the rate of inflation was around 12%, and 10 year Treasuries ranged from 7%-11%. However, gold experienced a price runup for the entire decade. Housing prices also experienced a similar boom. Maybe the answer is hard assets, but buying and selling can be hard and the timing to get this right is likely even harder. What I mostly remember about the 70's was being glad when it was over, but then came even higher inflation in the 80's combined with painful fed rates to bring rates back down. Diversification may be about the best answer to this dilemma, including more foreign representation and a higher cash balance.
I read the article, but is there an error in the author's chart? ABX on the NYSE is the symbol for Abacus Global Mngmt. ABX.TO is the symbol for Barrick Gold, which has a very different performance chart. I also think what maybe missing is that Barrick is not necessarily a speculator in gold, but a producer that would readily adjust its mining and refining operations based on the price of gold. It would constantly adjust what it pays for raw material and what it sell its finished product for it order to maximize its net return - independent of the spot price of gold. I doubt very much that Mr. Buffet has changed his mind on gold, but more likely sees a market play in Barrick as gold prices help drive its stock price, while still earning a current dividend return. The greater question may be: will Berkshire continue to hold on to Barrack when the inevitable turn in gold prices arrives?
I am retired 10+ years and have never missed being at work. We are fortunate to be financially secure and have been able to travel freely. However, I do have a few thoughts that may be worth sharing for those still working: 1) You need to figure out how to spend your time when retired. Hobbies, volunteerism, travel, etc. It doesn't matter - you need things to keep yourself busy and give purpose in retirement. 2) As the pandemic taught us, events may not always work out the way you planned, so you need to be flexible. And, 3) Aging is not a linear process, but accelerates as we get older. You may be able to walk 10 miles a day at age 65, but by the time you are approaching 80, you likely won't. If you want to travel in retirement, don't wait. Most of us are tied to a retirement timetable that depends on Social Security, Medicare and retirement savings, but if we had been able to swing it at an earlier age, I would not have hesitated to retire early.
I am confused by this question. If they invested the entire $10M in a 60/40 diversified portfolio, they could easily earn $250-$300K/yr. in dividends alone. In addition, their portfolio should be growing at about a 4-5% rate each year. And, to make this really simple, they could achieve this using a single Vanguard balanced fund which would cost little in fees.
Getting the average college age student to focus on future earnings in order to determine their major is probably a stretch. The kids already in B School probably get this, but not so much for many others. I totally agree with getting more education. A graduate degree and a couple of professional designations will pay long term dividends. Job hopping to increase earnings, especially in today's job market, is more acceptable, but don't abuse it as your reputations still has value. Save early, invest and save often are the keys to wealth for most people - if you have the money to save. At a minimum, meet the employer match on your retirement account as you are just throwing free money away if you don't make the match. Buying rental property today is a bit harder as properties are far more expensive today than in the 90's (and the 70's when I bought my first property). It can be a good idea if you have the money AND are inclined to be a landlord. Just don't over-leverage and don't expect being a landlord to be effort-free. I'll leave side hustles to others to judge as I was wage slave my entire career and have no basis on which to judge one way or another. However, there are only so many hours in the day and there also has to be time for family, fun and friends.
The odds of something like this happening to most of us are probably low. That said, if someone breaks in and holds us at gunpoint, demanding our passwords, I'm probably going to cooperate as the alternative isn't that attractive. The bigger problem that most of us face are the constant scams and phishing attempts that we receive via the web. It seems as though barely a day goes by that a new and more clever attempt to defraud us lands in our mail box. It requires effort to stay up to date on what may be a scam and how to deal with it. I also worry that as I age, I will be come more vulnerable to these sorts of attacks.
Credit and debt service is the price we pay to afford things we need or want that we couldn't otherwise pay for in cash. If you own a home, you've likely had a mortgage. When you bought your first car, you likely had an auto loan. And, when you are raising children, carrying a balance on your revolving credit card is often necessary. Debt is a tool that most of us have had to use at some point in our lives and, if we are lucky, we may achieve that golden moment when we have enough money that we can pay off the mortgage, the kids are launched and we are able to buy a new car with cash. For many, however, credit is a constant companion throughout their lives. I completely agree that there are times when it makes sense to borrow money for a specific purpose when borrowing would not otherwise be necessary. However, that is only an option when you have the economic ability to choose whether or not the benefit of taking on debt is worth the cost of that debt.
I recently read an article by an author suggesting that our cash cushion should be more on the order of 4 years - a period that should be sufficient in most circumstances to avoid selling into a falling market to meet our cash needs. I think that is a little extreme, but in our current economic climate, keeping 2+ years of cash and equivalents in our IRA's to meet our annual RMD needs doesn't seem all that crazy. The question you raise as to how and where to invest any such funds in absolutely relevant as the available options are many and care needs to be taken with offers that promise outsized returns. Personally, I keep a fair amount of cash in the treasury backed MMF in my brokerage account. All of the suggestions you noted are equally good, and all will be substantially better than the de minimis returns that bank checking and savings accounts continue to offer.
"..according to this argument, traditional active managers do more to keep markets healthy.."You have to laugh when you read this sort of logic. So, if I pay 1.0-1.5% (or more) in management fees, I'm going to get better performance because markets are healthier?? So far, research provides a resounding "no" to that question.I spent my career in the investment business and there were a lot of good things that the fees we charged paid for (client service, estate planning and settlement services, tax advice, etc.), but superior investment performance was seldom one of the outcomes.Given the ease of using index funds with their low cost and generally better performance over time, it's hard to see why someone would not use them, especially given the fact that the average investor tends to be pretty clueless when it comes to managing their own money.The argument that index funds are harmful to markets has been around for years and maybe someday, someone will be able to demonstrate this to be true, but in the meantime, its hard to argue against the fact that index funds have provided an accessible means to achieve better investment returns at a lower cost.
I live in Ca. and was a home owner when Prop 13 was passed. Like most homeowners of that time, I rejoiced at the prospect of a lower property tax bill. Had we known then what the long term consequences of Prop 13 would be, we might have had a different reaction. As a warning to any state that is contemplating legislation that will reduce or eliminate property taxes: Don't. If California can be viewed as any sort of example, cutting property taxes does not mean that your legislatures will reduce spending. It simply means they will find other ways in which to replace the revenues lost to a property tax cut. Over the years, a myriad of other new or increased taxes and fees have largely replaced the loss of property tax revenue. And, a whole new industry of advisors and lobbyists has been created to: 1) find ways to take advantages of the tax reduction rules, and 2) to modify the original legislation to make it even more favorable to certain classes of property owners. As a senior, I'd love to eliminate my property tax bill, but as the old saying goes: there's no free lunch. Given that states must run their budgets on at least a break even basis, eliminating a large chunk of state revenue will in most cases require that the lost revenue will have to be replaced by other means.
Comments
My first decade of work in the financial biz was during the 70's, which was considered a lost decade due to very low market returns 1970-80. Market returns are but one factor. What about the rate of inflation and 10 year bond yields? During the 70's, the rate of inflation was around 12%, and 10 year Treasuries ranged from 7%-11%. However, gold experienced a price runup for the entire decade. Housing prices also experienced a similar boom. Maybe the answer is hard assets, but buying and selling can be hard and the timing to get this right is likely even harder. What I mostly remember about the 70's was being glad when it was over, but then came even higher inflation in the 80's combined with painful fed rates to bring rates back down. Diversification may be about the best answer to this dilemma, including more foreign representation and a higher cash balance.
Post: Considering a Lost Decade When Retirement Planning
Link to comment from January 17, 2026
I read the article, but is there an error in the author's chart? ABX on the NYSE is the symbol for Abacus Global Mngmt. ABX.TO is the symbol for Barrick Gold, which has a very different performance chart. I also think what maybe missing is that Barrick is not necessarily a speculator in gold, but a producer that would readily adjust its mining and refining operations based on the price of gold. It would constantly adjust what it pays for raw material and what it sell its finished product for it order to maximize its net return - independent of the spot price of gold. I doubt very much that Mr. Buffet has changed his mind on gold, but more likely sees a market play in Barrick as gold prices help drive its stock price, while still earning a current dividend return. The greater question may be: will Berkshire continue to hold on to Barrack when the inevitable turn in gold prices arrives?
Post: Gold Isn’t Special
Link to comment from January 10, 2026
I am retired 10+ years and have never missed being at work. We are fortunate to be financially secure and have been able to travel freely. However, I do have a few thoughts that may be worth sharing for those still working: 1) You need to figure out how to spend your time when retired. Hobbies, volunteerism, travel, etc. It doesn't matter - you need things to keep yourself busy and give purpose in retirement. 2) As the pandemic taught us, events may not always work out the way you planned, so you need to be flexible. And, 3) Aging is not a linear process, but accelerates as we get older. You may be able to walk 10 miles a day at age 65, but by the time you are approaching 80, you likely won't. If you want to travel in retirement, don't wait. Most of us are tied to a retirement timetable that depends on Social Security, Medicare and retirement savings, but if we had been able to swing it at an earlier age, I would not have hesitated to retire early.
Post: The Life That Was Waiting
Link to comment from December 27, 2025
I am confused by this question. If they invested the entire $10M in a 60/40 diversified portfolio, they could easily earn $250-$300K/yr. in dividends alone. In addition, their portfolio should be growing at about a 4-5% rate each year. And, to make this really simple, they could achieve this using a single Vanguard balanced fund which would cost little in fees.
Post: What is the standard advice for someone who wants guaranteed income in retirement?
Link to comment from December 27, 2025
Getting the average college age student to focus on future earnings in order to determine their major is probably a stretch. The kids already in B School probably get this, but not so much for many others. I totally agree with getting more education. A graduate degree and a couple of professional designations will pay long term dividends. Job hopping to increase earnings, especially in today's job market, is more acceptable, but don't abuse it as your reputations still has value. Save early, invest and save often are the keys to wealth for most people - if you have the money to save. At a minimum, meet the employer match on your retirement account as you are just throwing free money away if you don't make the match. Buying rental property today is a bit harder as properties are far more expensive today than in the 90's (and the 70's when I bought my first property). It can be a good idea if you have the money AND are inclined to be a landlord. Just don't over-leverage and don't expect being a landlord to be effort-free. I'll leave side hustles to others to judge as I was wage slave my entire career and have no basis on which to judge one way or another. However, there are only so many hours in the day and there also has to be time for family, fun and friends.
Post: Six Ways to Grow Income
Link to comment from December 20, 2025
The odds of something like this happening to most of us are probably low. That said, if someone breaks in and holds us at gunpoint, demanding our passwords, I'm probably going to cooperate as the alternative isn't that attractive. The bigger problem that most of us face are the constant scams and phishing attempts that we receive via the web. It seems as though barely a day goes by that a new and more clever attempt to defraud us lands in our mail box. It requires effort to stay up to date on what may be a scam and how to deal with it. I also worry that as I age, I will be come more vulnerable to these sorts of attacks.
Post: Can we be completely safe?
Link to comment from December 20, 2025
Credit and debt service is the price we pay to afford things we need or want that we couldn't otherwise pay for in cash. If you own a home, you've likely had a mortgage. When you bought your first car, you likely had an auto loan. And, when you are raising children, carrying a balance on your revolving credit card is often necessary. Debt is a tool that most of us have had to use at some point in our lives and, if we are lucky, we may achieve that golden moment when we have enough money that we can pay off the mortgage, the kids are launched and we are able to buy a new car with cash. For many, however, credit is a constant companion throughout their lives. I completely agree that there are times when it makes sense to borrow money for a specific purpose when borrowing would not otherwise be necessary. However, that is only an option when you have the economic ability to choose whether or not the benefit of taking on debt is worth the cost of that debt.
Post: Debt Despite Myself
Link to comment from December 7, 2025
I recently read an article by an author suggesting that our cash cushion should be more on the order of 4 years - a period that should be sufficient in most circumstances to avoid selling into a falling market to meet our cash needs. I think that is a little extreme, but in our current economic climate, keeping 2+ years of cash and equivalents in our IRA's to meet our annual RMD needs doesn't seem all that crazy. The question you raise as to how and where to invest any such funds in absolutely relevant as the available options are many and care needs to be taken with offers that promise outsized returns. Personally, I keep a fair amount of cash in the treasury backed MMF in my brokerage account. All of the suggestions you noted are equally good, and all will be substantially better than the de minimis returns that bank checking and savings accounts continue to offer.
Post: Where to Keep Cash
Link to comment from December 7, 2025
"..according to this argument, traditional active managers do more to keep markets healthy.." You have to laugh when you read this sort of logic. So, if I pay 1.0-1.5% (or more) in management fees, I'm going to get better performance because markets are healthier?? So far, research provides a resounding "no" to that question. I spent my career in the investment business and there were a lot of good things that the fees we charged paid for (client service, estate planning and settlement services, tax advice, etc.), but superior investment performance was seldom one of the outcomes. Given the ease of using index funds with their low cost and generally better performance over time, it's hard to see why someone would not use them, especially given the fact that the average investor tends to be pretty clueless when it comes to managing their own money. The argument that index funds are harmful to markets has been around for years and maybe someday, someone will be able to demonstrate this to be true, but in the meantime, its hard to argue against the fact that index funds have provided an accessible means to achieve better investment returns at a lower cost.
Post: Index Fund Bubble
Link to comment from December 7, 2025
I live in Ca. and was a home owner when Prop 13 was passed. Like most homeowners of that time, I rejoiced at the prospect of a lower property tax bill. Had we known then what the long term consequences of Prop 13 would be, we might have had a different reaction. As a warning to any state that is contemplating legislation that will reduce or eliminate property taxes: Don't. If California can be viewed as any sort of example, cutting property taxes does not mean that your legislatures will reduce spending. It simply means they will find other ways in which to replace the revenues lost to a property tax cut. Over the years, a myriad of other new or increased taxes and fees have largely replaced the loss of property tax revenue. And, a whole new industry of advisors and lobbyists has been created to: 1) find ways to take advantages of the tax reduction rules, and 2) to modify the original legislation to make it even more favorable to certain classes of property owners. As a senior, I'd love to eliminate my property tax bill, but as the old saying goes: there's no free lunch. Given that states must run their budgets on at least a break even basis, eliminating a large chunk of state revenue will in most cases require that the lost revenue will have to be replaced by other means.
Post: Property taxes, our schools, our towns and seniors. Shared responsibility.
Link to comment from November 29, 2025