YOUR ESTATE PLAN specifies what you want done with your money and possessions after your death. But your life’s treasures extend beyond these material items—to your values, heritage, relationships, hopes, dreams, memories and stories. You can share some of this with family and friends through a legacy letter, sometimes called an “ethical will.”
Not long before my mother died, she wrote her legacy letter. She asked that it be read during her memorial service.
I’VE LATELY FACED one of the investment world’s greatest dangers: It’s called FOMO, or fear of missing out. If you pay attention to the financial news, you may be wrestling with this one, too.
Let’s start with bitcoin. I’ve studied it, but never invested. I’ve got friends who own the digital currency. I’m thrilled they’ve been wildly successful. But you know how awkward you feel when somebody tells an inside joke that you don’t get?
THE PANDEMIC HAS given many folks a taste of what retirement could be like. An abrupt end to work. A loss of social connection. Trying to make ends meet on a much lower income. Many haven’t been happy with the experience.
Worried that your retirement could be similar? Here are eight lessons we can learn from the pandemic, all drawn from my new book, Retirement Heaven or Hell:
1. Retirement can be a shock.
I’M TOLD THAT younger investors tend to trade more. That’s because those of us in our 20s and early 30s tend to be more confident—and perhaps overconfident—and that leads us to actively manage our portfolios as we seek to outpace the market averages. On top of that, it takes time to learn what works and what doesn’t, and that can also lead to frequent trading.
That brings me to 2021 and the four key portfolio changes I’m making:
A LIFE OF FRUGALITY might mean your children graduate college debt-free, which is a major accomplishment. But what about your happy-go-lucky neighbors, who spent every dime they earned and never saved for college?
At issue here is the Free Application for Federal Student Aid (FAFSA), which is the basis for the all-important expected family contribution (EFC). The whole thing can seem like one big crapshoot, as I can now attest.
The EFC may determine that your spendthrift neighbors’ kids also get to graduate debt-free.
IN THE FAMILY TREE of investors that began with Benjamin Graham sits a quiet, 100-year-old firm called Tweedy, Browne. This week, it published a chart that offered a new angle on a key debate in the world of personal finance: Is value investing dead—or just resting?
Before I get into the details of the Tweedy chart, I’ll back up and first recap the concept of value investing and why there’s a debate about it.
HAPPINESS RESEARCH fascinates me—and I’m not alone. Many of the insights uncovered by economists and psychologists have caught on with the general public, influencing countless life decisions.
Do you favor experiences over possessions? Do you strive to keep your commute short? Do you pause occasionally to ponder the good things in your life? Whether you realize it or not, you’ve likely been influenced by happiness research.
But it turns out that there are two popular insights that we need to unlearn—because they haven’t held up to close scrutiny:
Have you heard that happiness caps out at an income of $75,000 a year?
I RECENTLY HIT the “pay now” button on what I believe will be the last of 20 years of college tuition bills. That’s right, we have five kids. All went to college. None took out student loans.
Was it worth it—not just paying the tuition bills, but the decision to have children in the first place? It’s a pressing question. A birth dearth is hitting the U.S. and other countries around the world, as many adults opt to go childless.
IN SEPTEMBER 2017, my wife and I sold our home, our car and almost all of our earthly possessions. What remained fit in a storage pod measuring 12 feet by eight feet by eight feet. We then spent the next three years traveling across four continents and staying in more than 200 rooms. Along the way, I learned a few things about booking lodgings that could make your travels a little cheaper.
We used Airbnb 40% of the time and Booking 35%.
LAST YEAR WAS MY first bear market. I’ve been thinking a lot about it and about the astonishing stock market recovery that followed, so I’m better prepared for next time around. Here are three lessons I learned in 2020:
Lesson No. 1: Buy aggressively when markets fall. When the market crashed last February and March, I invested more in stocks. But I regret not having invested a lot more, despite having cash available.
WELCOME TO OUR inaugural monthly personal-finance update. I was all ready to write about January’s robust stock market—and then the GameStop saga garnered national headlines, with short-selling hedge funds losing billions, everyday investors crowing and politicians piping up. Some bashed Wall Street for allegedly thwarting retail traders, while others worried about the financial system’s stability.
Amid the tumult, the S&P 500 fell into the red for the year-to-date, despite blockbuster earnings reports from two of the market’s longtime leaders,
MANAGING OUR finances should be a year-round endeavor—but there’s something about a new year that gets folks thinking about money. In each of the past four years, HumbleDollar has seen a surge of traffic in January and that was true again this year, with readers perusing a record 403,000 of the site’s pages last month. These were January’s seven most popular articles:
“I’m going to focus my days more on living and less on investing,”
EVERY SO OFTEN, an arcane topic jumps from obscurity into the headlines. Such was the case last week when everyone was suddenly talking about the “short squeeze” on Wall Street. Below I’ll explain what happened and offer four thoughts on how to respond.
What does it mean to short a stock? In simple terms, it means you’re betting a stock will decline in price.
How does one accomplish this? First,
I WROTE MY FIRST column for HumbleDollar four years ago. In that article, I described how a midlife divorce had forced me to learn as much as I could about investing and personal finance. As part of that education process, I spent hours creating spreadsheets designed to predict my financial health over the next decade.
Planning didn’t seem difficult back then because my life was quite simple. I shared a one-bedroom apartment with my elderly dog.
AS SOON AS THE BALL dropped, ushering in the new year, I got my ball rolling, making contributions to three tax-favored accounts. Why did I do this in January? I like my investments to have all year to grow.
I go through the same routine every year, and it’s always a chore. I invariably forget what to do and, in any case, the steps involved often change.
The first account I contributed to was my Roth IRA.