Megan Markle just became the new Duchess of Sussex at 36, and with that, how much you should have saved before 35 has become a viral thing. I’ve seen articles about it everywhere, from Morningstar to the Wall Street Journal.
The common finance standpoint is that you should have saved at least twice your yearly salary by 35, which is an achievement many compare to marrying a British prince. More →
Introduction
The common advice on retirement investing is to be overweight stocks when you are far from retirement and then overweight bonds when you are closer to retirement. Some funds offer target date retirement funds that have such a portfolio allocation.
Vanguard’s target retirement funds invest up to 90% in stocks when you are more than 25 years from retirement, and then lower that exposure to about 50% when you retire. 7 years into retirement, you have 70% of your portfolio in bonds. More →
Introduction
A good way to see what’s going on in the pension fund industry is to analyze the 50 largest defined pension plans of the S&P 500 through Goldman Sachs’s 2016 Pension Review. More →
Introduction
In the 2000s, a strong bearish argument against stocks was that from 2012 onward, baby boomers will start retiring, increasing fund retrievals and pushing stocks down. The argument has faded in the last few years as the current bull market is beating all expectations, but it’s still a good idea to see how baby boomers retiring might influence future market trends. More →
Introduction
People usually wonder how much money they should put aside and invest in stocks. Should it be 5%, 10% or 15% of your income? Should you put any lump sums into the stock market or not?
As most of us don’t have clear plans and goals, what happens is that investors invest more when they should invest less and nothing at all when they should go all-in.
Today’s article will describe the expected end result from investing in stocks, how much your investments will return on average, and how to create a stable strategy in order to not make costly mistakes. More →
Introduction
Last week we discussed the true cost of low interest rates with particular attention paid to pension funding. Many defined pension plans are underfunded, and it’s a situation that has to be dealt with now despite it being against human nature to think about a problem that will only arise in the distant future.
On top of the problems in defined pension funds, low interest rates have a detrimental effect on general pensions and your retirement. More →
Introduction
The fact that interest rates are low is not news. While many are discussing whether the FED will raise rates or not, few analyze what the long term costs of such an artificial environment will be.
The environment is artificial because if it weren’t for the low rates, or negative rates in many parts of the world, there would be no lending as you don’t lend below a certain interest rate. In any case, this will have severe consequences on the economy, liquidity, inflation, banks, insurance companies, and retirement funds, and could create bubbles that will take years to deleverage. More →
Introduction
You’ve likely heard the advice that as you get closer to retirement you should move toward having a bigger chunk of your portfolio in bonds rather than stocks. Most retirement funds are structured in that way. Vanguard Target Retirement Funds allocate 90% of assets in equities and 10% in bonds if you are going to retire between 2058 and 2062, thus 45 years from now. More →
Introduction
One of the most discussed financial topics is the best ratio between stocks and bonds or other investments a person should have in order to retire at a certain age with enough funds to last through a long and cozy retirement. As there are many topics related to retirement this article is going to focus on the relation between stocks and retirement. More →