Bad weather outside, rainy, dark, dismal—I’m thinking about economics. A retired friend asked about QE3, the acronym for Quantitive Easing 3—the Federal Reserve’s (Fed’s) newest effort to boost the economy. There have been two related efforts in the past few years, hence this new one is number 3. “I don’t understand it—is there anything in it for me?” he asked.
Retired with an antique car—1927 Flint Roadster
When I ask people why they retired, or if still working, when they will retire, I often hear one or two reasons. Almost no one tells a complex story. The particular experiences vary among people, but not the degree of complexity. Continue reading
Photo by Bill Davenport, Kentville, Nova Scotia, CA
During working years we often do things under pressure—to provide for our families, to advance our careers or maybe to set an example for our children. But in retirement many of these obligations fade into the background. So the choices we make seem to beg for reasons.
Photo by PicketAces, Thomas Picard, Brooklyn, N.Y.
Active retail investors earn lower returns than their passive counterparts—it is a major theme here at Later Living. Today I’ll add one more argument for passive investing: active investing exposes retirees and others to greater likelihoods of dishonesty and conflicts of interest. Continue reading
Wayne Flick
Last year, my brother Wayne and I motorcycled the full lengths of Skyline Drive and the Blue Ridge Parkway, visited some museums and rode the Cherohala Skyway between North Carolina and Tennessee. We spent 7 nights together, 4 in tents, and the weather was good throughout. It’s been the longest time I’ve had alone with a brother in many years.
The best parts of retirement are often adventures we never had time for in middle life. Both Wayne and I motorcycled in our youth, then we gave it up because of the risks and costs. Retirement offered us each a few years when we could again experience the constant accompaniment of wind as we rode with somewhat modest abandon through mountain roads. Continue reading
An active investor. Photo from Celal Teber, Teber Photography, United Kingdom
A great deal!—to answer the title question. Three examples will illustrate the loss associated with active investing, or, stated positively, the gain from passive investing. The examples build on last week when I showed that active and passive investing had to achieve the same average gross returns. Yet active investing costs more, so in the end, the net returns to retirees are smaller with active investing.
Active investing links retirees with financial planners, brokers and actively managed mutual funds. Active investors believe they can identify low-priced stocks to buy, or that they can predict which stocks will drop in price so they can sell. In addition to individual stocks and bonds, they often buy actively managed mutual funds where a fund manager does the buying and selling. Continue reading
The Investment Race
Many retirees invest passively by buying shares in low-cost index funds that are designed to track selected markets. I have illustrated that approach in previous posts.
Many other retirees, and many younger investors, actively manage their investments. Some retirees do their own research and analyses while others hire brokers, financial planners or other advisers to manage their investments. They hope to achieve superior performance—to beat the market—by relying on extra effort, knowledge and skill. Continue reading
In the last two posts I’ve described the relatively new teaching in the Catholic catechism that God is lasting truth and love. Yet truth strikes me as getting skimpy treatment in much of our lives, including at church. People often say, “God is love,” but I seldom hear, “God is truth.” So I am on the lookout for truth. Continue reading
Last week I introduced the most recent Catechism of the Catholic Church and pointed out the “definition” of God as being everlasting truth and love. A God of truth and love is nothing like the hard-nosed punisher-God of my youth, so I looked into the history of Catholic notions of God.
Vatican II (the twenty-first Ecumenical Council of the Catholic Church, held in four sessions between 1962 and 1965) marks the beginning of a new understanding of God. For hundreds of years before Vatican II, an old God of power and mystery dominated Catholic teaching. Then in the decades after Vatican II, God emerged gradually as a warmer, more reachable deity, coming into an integrated theology in the 1994 catechism. The change is important and as best I can tell, largely underappreciated. Continue reading
People often grow more spiritual as they move through later life, and especially for men, that growth can be halting, timid, and incomplete.
People enter Twelve-Step programs to rid themselves of addictions, and central to the method is acknowledgement of a “higher power,” which may be God for the religious, but may be something else, something people choose or define for themselves. Continue reading