Investing

IN THE EARLY 1950S, journalist Walter Winchell popularized the term “frienemies” when he used it to describe the fraying relationship between the United States and the Soviet Union. Today, we’re seeing a similar dynamic in our relationship with China. This makes it an important topic for investors. 
Not long ago, the relationship between the U.S. and China was strong and mutually beneficial. Over the past 25 years, trade between the two countries has multiplied.

MY COWORKER RECENTLY retired. He is 50 years old and has been with the company for over 25 years.
The company offers a decent 401(k) match (100% match on 6% of your salary) along with other great benefits.
In his case, how can he generate income? How can you retire early if most of your assets are in retirement plans?
Most tax-advantaged accounts have restrictions on withdrawals, but there are a few strategies that many people don’t know of:
 

I’m an index investor, which obviously means I don’t pick stocks. It’s a comfortable position. When you own the entire market, you’re not making choices, you’re just participating in the market as a neutral observer.
My strategy has always been simple: buy broad index funds, reinvest the dividends, ignore the noise. No stock picking, no market timing, no cleverness required. The kind of investing you can explain at a dinner party without boring your guests too much.

I received this letter from Fidelity this morning. Interesting that they are now saying that some major index funds may not be diversified investments. What can you do about it? Invest your portfolio in other funds such as fixed income, international, value, or small cap?
 
Index Fund Policy Changes
Dear Shareholder,
Effective November 10, 2025, the “Principal Investment Strategies” and “Principal
Investment Risks” sections of the prospectus of each index fund shown in the table
below was modified to indicate that the fund may operate as a non-diversified fund,

When I sold my business and retired last year, I decided to keep two years of expenses in cash to avoid thinking about portfolio withdrawals immediately. I’ve worked through most of the first year’s buffer, and with recent strong equity returns, I’ve moved some gains into a money market fund to replenish my cash reserves.
Since this cash is earmarked for spending 24 months from now, I was initially planning to just leave it sitting in the money market fund—rates are still around 4% at the moment.

“The riskiness of an investment is not measured by beta but rather by the probability—the reasoned probability—of that investment causing its owner a loss of purchasing-power over his contemplated holding period. Assets can fluctuate greatly in price and not be risky as long as they are reasonably certain to deliver increased purchasing power over their holding period. And a non-fluctuating asset can be laden with risk.” — Warren Buffett, in his 2011 Berkshire Hathaway shareholder letter.

I just responded to a post by norm60189. He mentioned that Jack Bogle popularized index funds. My post got me thinking about my favorite Bogle quotes. Here are three, with my interpretation of the saying.
“Don’t look for the needle in the haystack. Just buy the haystack!”
Research has shown that annually the majority of active managers do not eat the market. As a result investors are better off not trying to pick individual stocks but buying broad market indexes.

Jack Bogle is frequently quoted. Jack was the founder and chief executive of The Vanguard Group and is credited with popularizing the index fund.
Here’s one of my favorite Bogle quotes:
“The stock market is a giant distraction from the business of investing”.
Warren Buffett is also often quoted.  Because Mr. Buffett purchased individual stocks, it was possible to observe how he approached investing as a business.  For example, Buffett eschewed tech stocks, yet had a large stake in Apple.

As many firms and advisors are now focusing more on Foreign market emphasis I am curious what others have allocated.  We have generally been 47-50% domestic equity, 38-35% foreign equity, including about 5%+ in Emerging Markets and the remaining 15% in bonds for the past 5 years.  The higher foreign exposure was a little drag in the past however is boosting returns currently.
Curious of others opinion on international is, we don’t make big swings but stay within a general range.  

I enjoy tasting new beers, and today there are some very good ones on the shelves. Still, it hasn’t always been this way.  Some time in the nascent days of the micro-brewery craze, I recall my boss, the owner of the beer distributor, commenting that it was as if the tiny brewers were having a contest to see who could make the lousiest tasting beer. 
I think that there’s an analogy that can be made between the abundance of micro-breweries and myriad financial products in that not all of them leave a good taste in my mouth. 

Recently I was reading a finance article and it mentioned occasionally utilizing Roth funds to stay within a targeted maximum tax bracket. Also I believe someone recently commented about having a small amount of bonds in a Roth account to limit to some degree the volatility. If everything in the future goes as hoped the Roth funds will be inherited by our children decades from now
Both of these points got be thinking (maybe perseverating) on what to do with my wife’s Roth account.

“The riskiness of an investment is not measured by beta but rather by the probability—the reasoned probability—of that investment causing its owner a loss of purchasing-power over his contemplated holding period. Assets can fluctuate greatly in price and not be risky as long as they are reasonably certain to deliver increased purchasing power over their holding period. And a non-fluctuating asset can be laden with risk.” — Warren Buffett, in his 2011 Berkshire Hathaway shareholder letter.

2025 was a stellar year for investors. “The S&P 500 finished the year with an 18% gain, achieving a ‘three-peat’ of double digit annual returns.” Investors who didn’t bail were rewarded.
We have a larger cash/bond allocation, about 55% stocks. The stocks do the heavy lifting while the cash/bonds provides some drag, but we are thoughtful about where we park it. The conventional thinking is that idle money is inefficient. It does not compound. But we like the flexibility cash provides.

I’ve been having a lot of great discussions with my new AI friend, Google Gemini. (Why not ChatGPT? I do consult it sometimes, but I don’t want to pony up for a paid account.) I like Gemini because it’s very positive. “Words of affirmation” are my love language!
In recent days, I’ve discussed how to balance my Peloton cycling and rowing to get an optimal workout mix to meet my health goals (Gemini gave me GREAT advice on this and was highly impressed with my near-perfect form scores on the Row) and how to convert a chicken-and-rice recipe that my husband has been requesting for the Instant Pot.

I am 77 years old and going to get a $500,000 inheritance. Wondering what to put it in to collect interest and also keep it relatively safe…..