Three Simple Index Fund Portfolios I’m often asked to recommend a simple index fund portfolio for people who are just getting started with passive investing and want to learn the basics. There are several good portfolios you can build to suit your needs using a few funds that require little maintenance. Balanced index funds are also a good option for people who don’t want to do any maintenance.
Retirement Doesn't Have To Be A 'Gamble' If you missed the well-documented, artfully produced PBS Frontline program, “The Retirement Gamble,” here’s the nutshell version: You’re screwed and it’s the financial industry’s fault. This is a piece that is absolutely worth your time to watch if you haven’t yet, but I will warn you that it takes on a bit more of a sensationalistic tone than I’d hoped for from PBS (maybe because the chief correspondent is also one of the protagonists in the story?).
Government Transparency Run Amok -- The Federal Register Information is good and too much information is exhausting. One goal for this blog is to simplify two seriously complicated subjects for the general population – health care reform and finance. A regular information source for me on these subjects is the Federal Register, the daily newspaper of our Federal Government. I peruse the headlines of proposed rules, final rules, regulations, notices, Presidential documents, and corrections. Most days, the content is in the high 200 pages and filled with useless information – at least useless for my purposes. Today, I woke up to a content of 629 pages – overwhelming.
Fama-French Three Factor Model The Fama-French Three Factor Model provides a highly useful tool for understanding portfolio performance, measuring the impact of active management, portfolio construction and estimating future returns. The Three Factor Model has replaced Capital Asset Pricing Model (CAP-M) as the most widely accepted explanation of stock prices in the aggregate and investor returns.
7 Steps to a Better Credit Score Whether it's by accumulating credit card debt, missing a few debt payments, doing a short sale, or even filing for bankruptcy protection, you may be one of the many people whose credit has been hurt during the weak economy over the past few years. We all know that can make it harder to get a loan. But did you know that if you lost your job (another common casualty in this economy), your damaged credit report can make it harder to get a new one? Of course, nothing has the potential to further hurt your credit like lack of income. Talk about adding insult to injury!
Street Smarts Trump Book Smarts If You Want To Get Seriously Rich It’s certainly possible to make yourself worth a few million dollars based solely on book smarts. A sensational accountant – a verifiable master in a particular corner of the tax code – can amass a personal fortune of this size. However, ramping up that expertise to make many multiples of those millions regularly requires street smarts as well.
Ending High Cost Investing Thanks to Jack Bogle, most of us understand the impact of fees on long-term investment returns. He was the one who pushed the notion that while 1% does not sound like a lot, when returns revert to the mean, about 8%, 1% is 12.5% of the total return.