In December of last year I wrote that “You Don’t Need Someone In Charge of Your Money,” then last week I wrote about using annuities as a tool to help retirees manage money. Is last week’s post an admission that you do need professional money management? Continue reading
Marriage often creates something larger than the two individuals. It can be that way with retirement income and security.
The last post discussed two ways to gain income from retirement savings: annuities and percentage withdrawal rules. This post describes marrying the two approaches. We learn that retirees can, in a manner of speaking, eat their cake yet still have it. Continue reading
Retirement Nest Egg
That simple title question suggests a simple answer, yet today’s retirees live out a large variety of answers. Life is unpredictable and it is not easy to save for retirement. Further, people get along on what they have and what they receive from others. In short, if a fellow will settle for a short, brutish retirement, he need save nothing.
Still, looking ahead and envisioning realistic retirement goals, then balancing current spending with saving are very useful activities. They put people in charge of their lives and give them a sense of responsibility, both of which induce maturity, discipline and work. Continue reading
Last weekend TV viewers watched the beginning of the third season of BBC’s Downton Abbey, a story about an aristocratic family in England in the 1920s. Sir Robert Crawley, Earl of Grantham, with his family and staff, live on investments in a splendid castle.
Last July readers of this blog met Alice, a model retiree, who also lives on investments and manages her portfolio of four different index mutual funds. Moreover, Alice has Social Security and a pension, both of which postdate Lord Grantham. Continue reading
A working Maine Farm, with barn attached to house, selling pumpkins.
I write tonight while most everyone else is likely watching election returns. After the votes are counted, let’s break away and go to Maine. Continue reading
In America we can always find things for sale that we do not need, and for most people longevity insurance may well fall into that category. A retiree who can manage investments and control spending should be able to provide his own longevity insurance. Continue reading
Along the Blue Ridge Parkway
People often wonder what they will do when they retire, and many delay retirement because they feel uneasy about striking out anew. Jim Keighton, a retired middle-school science teacher, has solved the problem for himself. Jim has doubled-down on birding, especially with hawks, a hobby he started as a boy. As I wrote about hunting, retired men often return to activities from their youth. Continue reading
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.
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