Yesterday was a great day. I spent the day with my girlfriend Julie, doing some wine-tasting along the Finger Lakes Wine Trail in upstate New York. This area is known for wineries dotted along the lakes, where you can spend the day traveling along, checking out what each has to offer. The wineries range from quaint and home-spun, to modern and spacious. Continue reading “Wine Tasting and Your 401(k)”
What started out as a quick thought about a depressing article on the difficulty younger generations may face preparing for retirement, has now become a mini-series about some of the positive trends I see, and today’s thoughts (the last installment of this series) are on some things that people who have a few decades prior to retirement can do to get into a much better long term financial position. Continue reading “I WAS Officially Depressed, but Feeling Better Now”
I recently saw a news article that caught my attention. The headline was a grabber: A woman had been arrested for stealing half a million dollars from her in-laws to help pay off her gambling debt. She had acquired about 14 million dollars in debt over 2 years. But the real news for me lay in the sentence that followed. She had also won 13 million dollars over the same period of time. This fact seemed noteworthy. Yes, the woman had a gambling addiction. She was arrested for stealing from her in-laws. But, she also had an obvious winning streak. To amass 13 million dollars in winnings takes some luck, or possibly even skill. However, by the end of her run (which coincided with criminal charges!), with all of her time and money she was no better off, indeed much worse off, than when she started. Continue reading “What Happens When the Desire for Wealth Overtakes the Sense of Reason?”
My wife and I recently took our last vacation for the year (boy did we need it). Because of the environment that we were in, it was easy to do some writing. This place – Cabo Pulmo — is off the beaten path, meaning no phones, no internet and no TV, so my wife and I got to spend some quality time bantering with my Dad and step-mom. When we were done with that we also took in some great hiking.
As we were hiking on one of the trails, I came across the inevitable “fork in the road.” Now in hiking, invariably one trail is easier to take, less elevation gain, fewer obstacles, easier on the body, etc. But it takes a longer time to reach the end of the hike. The other trail, more often than not, results in reaching the end quicker but you will climb higher faster and probably run into several obstacles that could also be more dangerous.
As I was hiking, I thought how this trail closely resembles the path(s) of the conservative and aggressive risk tolerance profiles.
The Conservative Investor: They will often have the bulk of their investable assets in cash or cash equivalents. In order to reach a retirement goal, they may have to save a lot more which could take a bit longer, but they won’t have to deal with market fluctuations.
The Aggressive Investor: They may be able to reach their retirement goal sooner due to the potential higher return their investments could earn, BUT they will also have to deal with obstacles such as 2008.
The point here is that much like hiking, there isn’t one right way to reach your goal, just know which path is the right one for you.
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I heard a statistic the other day that the average employee spends 30 minutes choosing their benefits at open enrollment. I cringe to think how some people choose the funds in their 401(k) plans and I’ve seen the resulting disaster from people choosing the wrong funds especially funds they thought were safe and turned out to be much more aggressive than they thought. Many of these were Target Funds. Continue reading “Target Fund: Glide To or Glide Through”
