I RECENTLY WROTE about the fallacy of time diversification. Time diversification is the widely held belief that market risk declines as our holding period lengthens. It’s one of the cornerstones of many investors’ approach to asset allocation and risk management.
Financial theory, however, refutes time diversification because market risk—as measured by standard deviation—actually increases with longer holding periods. The math tells us that the dispersion of potential results widens with longer time horizons. This counterintuitive insight rests on the assumption that total returns have a normal,

MY MOM JUST SOLD her house. A few months ago, she interviewed three real estate agents. Each offered her a different opinion of how much her home was worth. All three also charged different commissions.
In the end, she selected the agent with the highest fee. I was skeptical when she told me her 1,100-square-foot home would be listed for $500,000. My mom’s house and mine are nearly identical in size, age, location and condition.

REMEMBER JULY 2008? The financial system was faltering following Bear Stearns’s March 2008 forced merger with J.P. Morgan Chase. That summer, Fannie Mae and Freddie Mac needed special assistance. The Global Financial Crisis was almost upon us.
But many folks forget that, at that time, another crisis was coming to a head—a global energy squeeze.
In 2008, I was a busy 20-year-old driving my 1998 Toyota Camry around Jacksonville, Florida, taking summer classes and working a part-time job.

IN 1994, AMERICANS could find out what was going on in their communities by reading one of the 1,534 daily U.S. newspapers. Most of them were published in individual cities and towns where they served subscribers defined by geography, rather than by political persuasion or socio-economic class.
These newspapers were trusted voices. They provided common knowledge and community forums for everyone from bank presidents and doctors to plumbers and teachers.
As of 2018, 255 daily newspapers had stopped publishing,

LAST WEEK’S NEWS that Social Security recipients will receive a 5.9% cost-of-living adjustment for 2022 might seem like a nonevent. After all, those larger monthly checks will be fully devoured by today’s higher prices.
Or maybe not.
September’s report for the Consumer Price Index (CPI) showed that inflation for medical care services—a big cost for retirees—was quite tame over the past 12 months, rising less than 1%. Seniors also spend significantly less on transportation,

IT HAPPENED AGAIN. For the third time in two years, our credit card number was stolen. I learned this yesterday when I received the now-too-frequent question from Chase: “Do you recognize this gas station purchase for $1?” We live nowhere near the station in question, so I knew something was amiss.
I appreciate Chase’s diligence in identifying such transactions, and the fact that we won’t be held liable for any fraudulent charges. Still, I’ve grown weary of the whole process of cancelling credit cards,

ON MONDAY, OCT. 19, 1987, stocks plunged more than 20%. I was relatively new to investing—and the crash shocked me. I realize now that, when you’re starting out, no matter how much you study, the trait you’re most lacking is perspective.
When I began investing, I approached a successful investor and asked for tips to learn about the market. Part of his advice was to watch Wall Street Week with Louis Rukeyser on PBS.

INFLUENCERS ARE people who use their popularity and social media presence to nudge our decision-making, especially our spending choices. They’re a powerful force in today’s marketing world, particularly with younger consumers looking for cues as to what’s hot.
In one survey, 60% of those ages 16 to 24 credited influencers with purchases they’d made in the past six months, more than any other age group. Combined with the bandwagon effect and FOMO, or fear of missing out,

THE OTHER DAY, I did something I probably shouldn’t have done. I checked Zillow to see the current estimated value for the condo I sold last year during the COVID-19 pandemic.
I knew real estate prices had gone up quite a bit since I sold in June 2020. But when I looked at Zillow’s price, I was still surprised to see my old home had risen 19% during that short period of time. It’s hard to imagine,

A RECENT RULING from the Department of Labor appears to pave the way for more ESG (environmental, social and governance) mutual funds in 401(k) plans. Last week, Morningstar even launched an ESG-focused retirement plan service.
ESG assets are modest compared to other parts of the money management business, but they’re growing fast. Fund flows are substantial in the U.S. and gigantic in Europe. Investors are increasingly putting their money where their conscience is. But is that really a good thing when it comes to building our long-term wealth?

ONE OF THE TOUGHEST financial challenges most people face—second only to accumulating enough for retirement—is deciding how to convert those funds into retirement income. Especially when the goal is to never run out of money.

I pride myself on being informed. This morning, I received my comeuppance. I was reviewing my 401(k) account, which is administered by Fidelity Investments. I had taken my required minimum distribution for 2021, but was exploring other ways I could withdraw money.

I’M A MORNINGSTAR subscriber. I find that the site provides investing and personal finance information that’s sensible and useful for the average person, and that it promotes good investing and planning behaviors. Still, I was taken aback by a recent article, which discussed four funds that investors have been buying.
In terms of deciding what I buy, I don’t really care what others have been purchasing. Still, it’s interesting to see, so I checked it out.

HAVING LEFT the nine-to-five world, I face a decision: What to do about health insurance? I’m a single, generally healthy millennial. Historically, I’ve not run up major medical bills. But as with the financial markets, past performance doesn’t guarantee future outcomes. Here are the five options I’ve been considering:
1. Continue COBRA. When I left my job, I kept my old employer’s health plan, but I have to pay the full cost of coverage.

AMONG PENSION PLANS, foundations and other institutional investors, the dream is to invest with top-quartile money managers. But, alas, that appears to be an impossible dream. Most managers end up disappointing.
Sadly, it’s the same for everyday investors who buy actively managed funds. Most funds wind up lagging behind the market averages, and that’s before factoring in the high taxes these funds often generate and the extra risks they take.
Lots of reasons for this failure have been identified: Money managers stray from their investment discipline,

I WAS SITTING AT MY computer one lunchtime when an email popped up from one of my credit card companies, saying I’d just purchased nearly $12,000 of jewelry at a store in Toronto. Within minutes, I was on the phone to the card company.
I was quickly referred to the fraud unit. I told my story. The company credited my account, cancelled the card and mailed me replacements. Weeks later, I had to complete a form,