Investing in Your Quality of Life

The first step to investing in your quality of life is to think about and clarify what is truly most important to you.  This is a time to listen to your own heart and to focus on what you value the very most in life.  Whatever you identify will become the foundation for establishing meaningful life and financial goals.

In addition, as you think about your life in the future, it will be important to view your financial and life plan within a framework of your closest relationships.  If you have a spouse or life partner, you will want to factor in their dreams and expectations as well as your own.  You will also want to take into consideration your responsibilities and your hopes for your children, parents, siblings and those you consider to be “family.” (more…)

Bringing Balance to the Risk Tolerance Continuum

When you are making a financial decision, do you intentionally weigh the potential risks and rewards?  Is weighing that balance more of a rational or emotional process for you?  In other words, do you tend to rely more on facts or on feelings?

For example, when Karla got a promotion at the architectural firm where she is employed, she gave serious consideration to buying a new car.  She thought about the practical and emotional rewards of having a new car such as: 1) having a dependable means of transportation, 2) getting better gas mileage, 3) portraying a successful image to her clients, and 4) experiencing the pride and pleasure that comes with owning a new car (there’s nothing like that new car smell!). (more…)

Taking Stock of Lump-Sum Investing vs. Dollar-Cost Averaging

Some investors favor a dollar-cost averaging (DCA) approach to deploying their investment capital. Unlike lump-sum investing, in which the full amount of available capital is invested up front, DCA spreads out investment contributions using installments over time. The appeal of DCA is the perception that it helps investors “diversify” the cost of entry into the market, buying shares at prices that fall somewhere between the highs and lows of a fluctuating market. So what are the implications of DCA for investors aiming to generate long-term wealth? (more…)

Is the Price Right?

It is often said that stock prices take the stairs up and the elevator down. In the first half of 2020, we saw how fast that elevator ride down could be. In just two months, U.S. stocks lost effectively years of gains. In fact, this was the fastest decline of 30% or more that we’ve ever experienced.

U.S. stocks weren’t alone on the elevator ride down. Joining them were stocks of all developed and emerging countries, as well as many commodities, like oil. True, oil’s decline was exacerbated by a debate between Russia and Saudi Arabia over the amount being produced, but no one expected it to briefly trade at a negative $37 per barrel. (more…)

Doing Well and Doing Good?

Growing interest in the impact of fossil fuels on the global climate may spark questions about whether individuals can integrate their values around sustainability with their investment goals and, if so, how. As citizens, individuals can express their political preferences around sustainability through the ballot box. As investors, they also can express their preferences through participation in global capital markets. One key question these investors face is how to do this without compromising their desired investment outcomes. For instance, how can they reduce their portfolio’s environmental footprint while maintaining sound investment principles and achieving their investment objectives?

Read more here…

Evidence-Based Planning

“I don’t know…something just doesn’t feel right,” you mumble through your mask to your primary care doctor while sitting on the examination table under a flickering fluorescent light in a room decorated with anatomical charts and hand-sanitizer dispensers. After listening to your heart and your lungs, the doctor diagnoses your feelings of worry as a mild condition that is easily treatable but could become serious if a proper treatment regimen isn’t followed. The doctor gives two treatment plans: one coming from the New England Journal of Medicine and the other from a health magazine that can be purchased at your local convenience store. Which plan do you choose? (more…)