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Investing Blog Roundup: The Annuity Puzzle (Again)

Most people really don’t like lifetime annuities. At the same time, most people really do like pensions. An interesting fact, given that they’re the same thing.

This week David Blanchett, Michael Finke, and Timi Jorgensen took a look at a recent survey by The American College. The survey assessed people’s knowledge and attitudes about retirement income planning and financial products — looking specifically at people age 50-75 with at least $100,000 of non-housing wealth.

There are a number of interesting findings, including that people’s appetite for risk declined during the COVID-related downturn, yet demand for annuities declined as well.

Recommended Reading

Thanks for reading!

Can I Retire (2020 edition), Investing Blog Roundup

Another book announcement for today: the 2020 edition of Can I Retire? is now available. Of the 2020 editions I’ve done this year, this is the book that received the most significant update. Some of the changes include:

  • The discussion of annuities has been adjusted, given the new environment in which inflation-adjusted SPIAs are no longer available;
  • There’s a new brief chapter on Social Security and how that fits into a broader retirement plan, especially in a “creating a floor of safe income” sort of context;
  • There’s a new chapter on retirement spending strategies; and
  • The discussion of asset location has been condensed somewhat, given its reduced importance in a consistently-low-yield environment.

You can find the print edition here and the Kindle edition here.

Other Recommended Reading

Thanks for reading!

Investing Blog Roundup: Downsizing, How to Get Rid of Stuff

Over a lifetime, we accumulate a lot of stuff. If you’ve lived in the same home for many years — and it’s therefore been quite a while since you’ve gone through the forced purge of moving — it’s probably a lot of stuff.

At some point, all of that stuff will have to go. Maybe that job will be yours if you do end up moving, or maybe the job will ultimately fall to your children or some other designated party. But, eventually, none of your stuff will remain in (what is currently) your home.

This week I encountered an interview of David Ekerdt about the findings from his new book, Downsizing: Confronting Our Possessions in Later Life. For the book Ekerdt conducted extensive interviews with people ages 50+ about their experiences getting rid of their stuff. The interview below shares many of the lessons and insights gained from that research.

Other Recommended Reading

I hope you’re well, and thanks for reading!

Investing Blog Roundup: Why the Market Doesn’t Care that the Economy Stinks

This week Barry Ritholtz tackled the question of why the stock market is doing reasonably well when the economy, clearly, is not.

One critical point, as we discussed recently, is that the stock market and the economy are not the same thing. The stock market isn’t even supposed to reflect the economy. (Rather, the market’s value at any time is a prediction, not a reflection of current status. And it only reflects a prediction regarding publicly traded companies, which are only a piece of the broader economy. Further, it only reflects how profitable those companies are predicted to be, not anything regarding how well their employees — or, ahem, former employees — are predicted to fare.)

Ritholtz also points out that it’s easy to overestimate how badly publicly traded companies, on the whole, are doing. Many very visible sectors (e.g., airlines) are doing horribly, but if such sectors make up only a small portion of the overall market capitalization, how well/poorly they perform doesn’t have a very large impact on the overall market performance.

Recommended Reading

I hope you are well, and thanks for reading!

2020 Editions: Investing Made Simple, Sole Proprietor Taxes, LLC vs. S-Corp (Also a Roundup)

Just a quick announcement today. The 2020 editions of three of my books were released this week. You can find them at the links below:

In each case the book has been updated for any applicable tax changes — both legislative changes and inflation adjustments to various figures.

In Investing Made Simple the chapter about working with a financial advisor has been reworked to discuss not only the differences in compensation (e.g., hourly fees as opposed to AUM fees as opposed to commission) but also the fact that different advisors actually do different things for you (e.g., some advisors focus exclusively on managing your portfolio, while others provide broader financial planning).

Other Recommended Reading

I hope you’re well, and thanks for reading!

Investing Blog Roundup: Open Social Security Can Now Save Inputs

Just a quick note about the Open Social Security calculator: it now offers an option to save your inputs. There’s a link at the bottom of the page. Right-click that link and save the URL. When you revisit that URL, your prior inputs will be pre-filled.

This way you can come back later to revisit a calculation, or you can easily share it with somebody else (e.g., another member of your household or your financial planner).

Recommended Reading

I hope you are well, and thanks for reading!

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My new Social Security calculator (beta): Open Social Security