FOR THE FIRST TIME, retail investors have more money in index funds than actively managed funds. This is based on March 31 figures compiled by Morningstar and reported by columnist Allan Sloan.
Twenty-five years ago, Vanguard Group founder Jack Bogle published his remembrance of the 1970s launch of the first index fund geared to main street investors. As I page through the book again, I’m reminded of how close indexing came to failing.
Bogle recounts going on a 12-city roadshow,

EACH OF US TAKES our monthly income and then makes countless decisions—some big, some small—about how to use those dollars. How can we get the most from the money that flows through our hands? I find it helpful to look at this “income allocation” through three prisms.
Divvying it up. We can use our income for three main purposes: spending it today, saving it for tomorrow or giving it to others. Our instinct is to spend today,

I GREW UP IN a lower-middle-class family. We lived in a small apartment where I slept on the living room couch. My father sold cars for a living.

Today, my living standard is quite different. On average, 97% of retirees my age have less income and assets than my wife and me. Our friends are in similar economic circumstances. If they weren’t, they couldn’t live where we do.

The minimum needed to live in our condo community is $24,000 a year.

EBAY CAN BE a fantastic teacher of basic economic principles. I’ve been an active buyer recently, and enjoy watching the interaction among supply, demand and price.
Take the market for business attire. Demand has declined for suits, blazers and jackets. This has happened at the same time that supply has risen, so prices are cheap.
Suits were once the everyday uniform for both men and women. When I started working, I owned six suits in shades of blue and gray: a winter suit,

RONALD REAGAN SAID “the nine most terrifying words in the English language are ‘I’m from the government and I’m here to help’.” Government programs are put in place to address real concerns. But they often come with unintended consequences.
When created in 1965, Medicare addressed the real need of senior citizens who couldn’t afford health care, just as Social Security was established in 1935 to help seniors in poverty. Both have become pillars of American retirement,

I WAS EDITING a fellow graduate student’s paper. She’s in her mid-20s, less than half my age. She’s bright and communicates well in class discussion, but her paper—frankly—was a mess. Great ideas, but she expressed them in overly pretentious language. One bloviated sentence was more than 60 words.
When I asked her why she did this, she said she wanted to “sound smart” by not using the same old words she normally uses. She worried that no one would take her seriously unless she adorned her ideas in the polysyllabic jargon of academia.

WHEN I ASKED MY college class this spring how many had been taught personal finance before, just a single hand went up. That’s why I teach Franco Modigliani’s lifecycle hypothesis of savings to my behavioral economics class.
A brilliant student born to a Jewish family in Rome, Modigliani was awarded first prize in a national economics contest by Mussolini himself. Warned to flee Italy while he still could, Modigliani soon after booked a zig-zagging trip through Switzerland and France before landing in New York in 1939.

THE HIGHEST CREDIT score possible is 850, and I’ve hit that mark in eight of the past 12 months. In the other four months, I had a score of either 844 or 846 under the credit rating formula created by FICO, formerly called Fair Isaac Corp.
A FICO score between 800 and 850 is considered exceptional and gets you the best rates on loans. A score of 670 or more is considered “good,” but more doors and opportunities are available when your score hits 740,

LIKE MANY PEOPLE who read HumbleDollar, I greatly respect Warren Buffett’s opinions and insights. I’ve even attended Berkshire Hathaway’s annual shareholder meeting in Omaha. Now that it’s broadcast, I reserve the Saturday of the meeting to watch it on the web.
Seeing it from a distance means I miss out on the terrific deals various Berkshire companies offer shareholders who attend in person. By attending virtually, however, I don’t have to navigate the crowds or spend six hours driving to Omaha and another six hours returning home.

IT’S FINALLY HAPPENED: I feel old. Never mind that I am old. Until recently, I didn’t feel old. One contributor to my changed mood: At 78, I’m now the same age as my father was when he died 34 years ago.

I’ve been trying to figure out why I started feeling old. The onset of the pandemic and my recent health scare are likely candidates. Before the past two years, never did I worry about my health.

ARE YOU IN YOUR 60s and worried about rising consumer prices? It’s worth understanding how inflation affects Social Security benefits—especially its impact on those who postpone claiming their monthly check.
Social Security benefits jumped 5.9% in 2022, thanks to the annual cost-of-living adjustment. This inflation increase was based on the Bureau of Labor Statistics’ CPI-W. This was the largest adjustment since 1982, and it affected nearly 64 million retirees. The increase took effect in January.

GAS PRICES TOOK another step higher last week—troubling news for the millions of families planning their summer vacations.
It’s already shaping up as a big travel year. An estimated 39.2 million folks hit the road or took a flight over the Memorial Day weekend, according to AAA, up 8.3% from last year. GasBuddy data show the average price for a gallon of regular unleaded was $4.60 over the holiday weekend. Steep? By July 4,

THE INVESTMENT consulting firm Callan publishes its periodic table of investment returns each year. It shows the results of key asset classes on a year-by-year basis. Each asset class is color-coded and ranked from best to worst. This makes it easy to see not just annual performance, but also relative results.

The periodic table is valuable because it illustrates that there’s rarely a consistent pattern to relative returns from one year to the next.

I THINK SERIES I savings bonds are a great place to stash money you’ll need to spend in five or six years, and yet I’ve resisted buying. I’ve seen credit cards that offer more cash back than the cards I currently carry, but I haven’t taken the bait. The reason: My goal is to have fewer financial accounts, not more, even if it means fewer dollars in my pocket.
As I discussed in an article earlier this year,

THIS IS ABOUT my crypto journey. Spoiler alert: I still don’t own any.
My journey began in 2013, when I was serving as an assistant principal in Philadelphia. Since I was always giving advice on our 403(b) plan based on my voracious reading of personal finance blogs, a colleague asked what I thought about bitcoin and whether she should invest. Back then, the price was well under $100—close to $30, I think. I dismissively told her to avoid it.