Investing

On Sept. 30, 2026, the Securities and Exchange Commission proposed two rule changes which would allow performance based compensation as an option on certain registered management investment companies. Here is a link to a fact sheet of the SEC announcement about the proposed changes.
The rule changes seems to allow hedge fund like fee compensation to be paid from certain mutual funds and ETFs. I think such performance based compensation is opposite the reasons such funds came into existence.

Here at HumbleDollar, we spend most of our time on growing wealth. That focus leaves a blind spot: we’ve neglected readers who want to shrink their wealth through their investment choices. In the interest of balance, I’d like to address that gap systematically.
Let’s start with the easiest set-it-and-forget-it approach, a classic one-two combo. First, find a high-fee advisor who champions high-fee funds. Give it a few years and, if all goes to plan, you should see a healthy dent in your potential net worth.

Does it matter? Probably not if we are happy and reasonably financially secure. Benchmarks can be informative, if not helpful, though. For one thing they remind us when discussing money, affordability, frugality and such how relative, how different things can be and how normal at the same time.
An interesting (?) information exercise follows without conclusions or recommendations to move to Mississippi😎
Through extensive research (four AI apps) I have learned that “rich” is determined by income and “wealthy” by value of assets,

Earlier this year, I had two attempts to withdraw funds from different financial institutions within a couple of days of each other. The first was an annuity. The hacker submitted a withdrawal form either by fax or US mail. I discovered it when I got an email asking me to resubmit the request with the correct SS#. I informed the company that I did not submit the request and they immediately locked my account.
This may have been an inside job because I submitted a request to change beneficiaries a few days earlier which was the first time I had contacted the company since the annuities were setup 2 years ago.

I’ve never cared much for bond funds. They never mature. Their NAV is at the mercy of Federal Reserve policy. 
I like how individual bonds mature and return my investment, but I don’t want the risk of owning individual issues. 
I nearly brought this question up in Mark Corothers ‘Flipin’ post, but didn’t want to send his discussion about real bond returns down the wrong rabbit hole.
So here goes. I have a CD ladder to protect me from a lost decade.

With the current fixed income environment, have you given any thought to your portfolio asset allocation?
For most of the last 15 years bonds paid next to nothing, a big fat zero actual return. For a stretch in 2021 they actually paid less than nothing: 10-year TIPS traded at negative real yields, meaning you were paying the government for the privilege of protecting your own purchasing power. In that world, equities weren’t one part of the growth engine.

EVERY THREE MONTHS, a small committee meets in Manhattan to make decisions that dictate where billions of retirement dollars flow. You won’t see them on financial television. They belong to the Index Committee at S&P Dow Jones Indices.
Nearly all readers here likely know the S&P 500 isn’t a mindless tally of America’s 500 largest businesses. Yet in an era dominated by mega-cap hype, it is worth remembering just how ruthlessly disciplined that curated roster really is.

I have been reading in some of the comments on the Forum recently that some of you use a total portfolio approach for your investments.  I tried to look it up in Jonathan’s guide but couldn’t find it. I don’t know what this is and was hoping some of you might be able to explain it in a way I could understand. I am not sure if this is something I need to research more?  I tried to look it up on Mother Google but didn’t understand what the AI said it was.  

An e-mail I received from Retirement Researchers by Wade Pfau contains this:
“If a retiree owns 1,000 shares before receiving a dividend and still owns 1,000 shares afterward, it can seem as though nothing has been spent. Selling 20 shares feels different because the account now holds fewer shares. That visual difference can reinforce the idea that dividends allow you to spend income while preserving principal.
For example, suppose a company is trading at $100 per share,

Be careful out there. Index composition is a key to getting consistency in your investment outcomes. Vanguard vs iShares vs State Street vs etc. As Jason Zweig writes in the Wall Street Journal, it all depends on the composition of the index.
 
https://www.wsj.com/finance/investing/how-a-few-hot-stocks-can-make-twin-funds-act-like-strangers-0ef7c52b?st=6mxLt3&reflink=desktopwebshare_permalink
 

I saw this on the back page of today’s Wall St Journal.
“On this day in 1971, Wells Fargo launched the world’s first stock-index fund. One mutual-fund manager’s reaction: “If people start believing this random-walk garbage and switch to index funds, a lot of $80,000-ayear portfolio managers and analysts will be replaced by $16,000-a-year computer clerks. It just can’t happen.”

We all remember the 2022 bond collapse, triggered by rising interest rates. Most of us were caught out, a supposedly safe asset class posting double-digit losses. Some of those bond funds are still slightly underwater four years later. Which brings me to a question worth thinking about.
Right now, Treasury Inflation-Protected Securities (TIPS) are offering guaranteed real returns of roughly 2-3% above inflation. That’s a compelling, ultra-safe option for liability matching in retirement, and I think most people would do well to look into it.

TIPS are US Government securities that currently pay two to three percent real return depending on the maturity selected. You can buy them from your broker, Treasury Direct account, Exchange Traded Funds (ETFs) and mutual funds. So, if inflation for a time period is three percent, your bonds earn five to six percent depending on the time period. These real returns are guaranteed by the US Treasury. I will not give all the details here and am not giving advice.

Nice! On top of other recent gains, the only individual stock I owned was up two days in a row and had reached the sell price I had in mind for months. Shortly before the market closed on Friday, I logged in to E*TRADE and stepped off the rollercoaster ride once and for all.
The sale came almost 17 years to the day that I first purchased that company stock via an employee stock purchase program (ESPP).

In a previous post I recounted how luck and stupidity kickstarted my retirement savings journey, but I glossed over one important detail: the cost.
In the mid-eighties, high-fee front-loading was standard practice, and these products were typically sold by people whose entire compensation depended on shifting them. The pressure to sell was enormous, and the salespeople were good at their jobs.
My twenty-year-old self walked straight into one of them. He was slick, he was persuasive,