Being wealthy doesn't mean having all the money in the world, just not having to worry about it.

What about REITs?

Question: I have dropped commodities for the “well rounded portfolio” and embrace pretty much what you have advised here in this November post. But you don’t mention REITs [Real Estate Investment Trusts]. I still have about 8% in REITs but am thinking of selling those as well. Thoughts? Answer: REITs are businesses, so they fit into Read more »

The Ride Is the Reason for the Return

I despise market commentary, both for the presumption that anyone really knows the reason for short-term movements and because it distracts people from the fact that investing in equities is a matter of long-term ownership in the businesses that provide the world’s goods and services. Fluctuations in human emotions explain more of the short-term movement Read more »

Seven Steps to Financial Peace of Mind

Before addressing specialized areas, I’d like to offer my thoughts on basic financial advice for do-it-yourselfers: Spend less than you earn Be an owner, not a loaner Commit to your service Locate yourself Adopt pay-as-you-go Protect against major threats Focus on relationships 1. Spend less than you earn. You want your life to point up rather Read more »

An All-TIPS Retirement Savings Portfolio?

Question: I’m curious how you might evaluate the thinking of Zvi Bodie, who notes, in this link, that 100% of the money he is setting aside for retirement is held in treasury-inflation-protected securities, and that all of one’s income needs for retirement be comprised essentially of social security plus TIPS in an IRA account. The Read more »

Lesson 7 – The Problem of the Short Term

People sometimes get the impression that I think all investors, regardless of their personal circumstances, ought to keep 100% of their investment funds in stocks all of the time. Now I won’t be so disingenuous as to say, “Nothing could be further from the truth.” But I will say that isn’t the truth. As books such Read more »

Lesson 6 – The Real Meaning of Safety

There are some people who believe that a retiree’s portfolio should consist primarily of “safe” investments. In this context, safe generally means low volatility. If, for example, you keep all your money in a federally insured bank account, then it will never have a day when it goes down in value. There are, however, two Read more »