SUMMARY: Pay off debt if bonds make up any part of your investment portfolio. Even with a portfolio as aggressive as 90% stocks and just 10% bonds, anything with a non-zero interest rate should be paid off. This idea – to prepay debt if investing in bonds – comes as a surprise to those investors […]
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Future Housing Returns are Stark
In the June 2021 issue of the Financial Planning Association’s Journal of Financial Planning, I wrote a short piece on housing. In the article, I pointed to the rise in prices. I argued that while housing has done well over the last couple of decades, that trend may not continue. Given that uncertainty, funding retirement […]
How to Interpret Monte Carlo Outcomes
How do I present probabilistic outcomes (i.e., Monte Carlo simulations) to financial planning clients? I was asked this question recently – while consulting with a company on developing their financial planning software. Fortunately, the answer is straightforward: frame Monte Carlo results not as the likelihood of financial plan failure, but as the “probability of adjustment.” […]
Just Buy Value
I’ve had a couple of conversations with some lay investors of late. Both times, friends approached me with questions about investing. They were looking to profit off the pandemic, intrigued by the opportunity to buy certain stocks on the cheap. Travel and tourism stocks – they reasoned – were ripe for recovery (once the impacts […]
Intangible Beanie Babies
I wrote a piece about Bitcoin a few years back. Since then, Bitcoin mania has waxed, waned, and waxed again. Given its new record high and accompanying successive round of mania, it’s time to return to the subject of Bitcoin. Why Bitcoin Fails Firstly, Bitcoin a terrible store of value. Compare Bitcoin to cash, specifically […]
Customer Management Relationship (CRM) Software Best Practices for Financial Advisors
Recently, I was able to connect with a fellow advisor. Our topic of conversation was managing firm processes. “What is the best way to stay on top of a client task?” he asked. That’s an easy answer: a well-implemented customer relationship management (CRM) tool. It doesn’t matter if you’re using JunXure Cloud, Redtail, or even […]