…Your Goalie …Your Closer …Your Kicker …Your 4th Quarter Free-Throw Shooting …Your Short Putts to Force a Playoff in the US Open …Your Worst Bluff …The Worst Day Your Brakes Have You get the picture. So where’s the investing angle? There’s always a tie-in! Here it is: Regarding investment professionals…. You’re Only as Good as Your Worst Conflict of Interest Dave Ramsey recently caused a stir in the world of Finance Twitter because of his ridiculous tweet regarding pending legislation to force stockbrokers to act as fiduciaries toward clients: The thing about Dave is he has a lot of good philosophies regarding personal finance. He has a very large following because of the huge megaphone his radio program provides, and it allows him to share …
Why Hire an Advisor? It’s a No-Brainer
Yes, I happen to be an investment advisor myself but I’ll try to prove to you this is not some self-serving advertisement with links to SIGN UP FOR MY SEMINAR! I see it as a no-BS manifesto for the power of low fees and simple advice. The added value of being an investor with a trusted, reasonably-priced partner in your corner tends to far outweigh the monetary cost of the relationship. It may even be more important now than ever if we consider the outlook for returns in the medium-term. All scenarios below are *hypothetical* and all numbers are *estimates*. Givens: You need to save money for the future. You need that money to grow faster than inflation if you hope to stick …
A Shotgun Pattern
This data from Vanguard is so good it requires its own post. “Average” is what all long-term investors can expect to get over the span of decades, but at the same time they’ll rarely get what’s considered to be normal on a yearly basis! Such an important concept to explain:
Risk Tolerance, and an Offer from Riskalyze
Let’s get this out of the way first: this is a post targeted more towards advisors and was inspired partly by a conversation on Twitter. Nerdy terms and opinions will follow. What this ISN’T, is an attempt to offend anyone at Riskalyze, or its users – both groups are trying to do what they think is best for clients (just like I am). Assessing risk tolerance is an absolutely vital, and legally required, task among RIAs, but how we get there is a point up for debate. Risk tolerance software is all the rage right now, but I’m not sold on its advertised use case. From my view, the software is treated more as a means to generate “sales” and also …
The Wealthy Dart Thrower
Today I reached page 51 in the highly regarded personal finance book The Wealthy Barber, abruptly closed the book, and hung my head in sadness. Until this point I really liked the writer’s style and it seemed to be an interesting take on explaining investing to beginners. All was well until this passage on picking mutual funds: “Make sure that if a fund has solid rates of return, the manager who created them is still there. You’re not buying past performance numbers; you’re buying a manager’s expertise. If fund ABC averaged fifteen percent a year under the guidance of Jack Smith, but Jack Smith left, stay away from ABC. You can’t be sure what you’re getting.” First, picking actively managed funds is a …