Friday, June 23, 2017

Short Takes: Fear on Wall Street, Home Affordability, and more

The Blunt Bean Counter is giving away copies of his book Let’s Get Blunt about Your Financial Affairs. To enter the draw, just complete a short confidential survey about how “on track” your retirement plans are. To maintain confidentiality, there’s a separate link to the draw at the end of the survey. He’s a friend, so I took this short survey myself. You can go directly to the survey here and see his write up about it here.

Here are my posts for the past two weeks:

The Index Revolution

Experienced Investors and Novices

Here are some short takes and some weekend reading:

The Reformed Broker asks “If stocks keep going up, why isn’t anyone celebrating?” A couple of other good quotes: “This may be the first bull market in history that featured layoffs on Wall Street” and “The stock market is now 35% passive and 65% terrified.”

Squawkfox has some sensible advice about whether you can afford to buy a home. She even has a spreadsheet to help you work out the number for your unique situation. Sharp-eyed readers will notice a big difference between her rule of thumb that “a mortgage should not exceed 3X your annual income” and the much more relaxed “stress test” limits required by the government. Squawkfox says you should ignore how much the bank says you can borrow and figure out what you can really afford.

A Wealth of Common Sense lists the things the market does not care about. The only one I’m not sure about is the “passive vs. active debate.” It seems that every time someone asks how I invest and I explain that I rarely trade, the market moves in some way that trips one of my rebalance thresholds and I end up making a couple of trades. But seriously, the market doesn’t care about you or me at all. A bonus from A Wealth of Common Sense: some amusing money manager clich├ęs.

Dan Bortolotti talks with Tom Bradley of Steadyhand Investment Funds to discuss what they agree and disagree about in their index and non-index (undex) approaches to investing.

Mr. Money Mustache suggests preparing for the next recession now while times are still good. Some amusing bits: auto loans are the worst “outside of mortgaging your shins to a loan shark to afford tonight’s cocaine,” and the car is a “bank-financed gas-powered racing sofa.”

Jim Yih at Retire Happy has some great advice on how to handle an inheritance. Combine the fact that so many people handle windfalls poorly with the fact that they’ll be grieving, and it’s no wonder they need to take special care with an inheritance.

The Blunt Bean Counter discusses how to avoid family strife by discussing your will with your family. It seems that almost all parents believe that after their death their children will get along well, but serious conflicts over inherited property are common.

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