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Investing Blog Roundup: Interviewing the Vanguard Total Stock Fund Manager

For the Bogleheads on Investing podcast, Rick Ferri recently interviewed Gerry O’Reilly (manager of the Vanguard Total Stock Market Index Fund and ETF) and Rich Powers (Head of ETF and Index Product Management at Vanguard). It was quite a discussion, covering a range of nitty gritty details about how the fund is run.

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Investing Blog Roundup: Morningstar Fund Fee Study

Morningstar recently released their annual fund fee study. Mutual fund investors continue to pay lower and lower fees per year, and it’s largely due to the fact that we’re choosing less expensive funds:

“Investors deserve most of the credit for putting the squeeze on fees. […] In nine of the last 10 years, the cheapest 20% of funds across all Morningstar Categories have, as a group, accounted for 100% of the net inflows into all funds. Meanwhile, money has poured out of the remaining 80% in all but one year over the past decade.”

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Investing Blog Roundup: Guaranteed Income as a “License to Spend”

This week I encountered a recent paper by David Blanchett and Michael Finke in which they found that, among retiree households with similar levels of wealth, the greater the percentage of that wealth that is held in the form of guaranteed income (i.e., Social Security, pension, or annuity income), the more the household spends.

To an extent, this makes perfect sense, as a household whose wealth is overwhelmingly in the form of stocks and bonds must pick a conservative spending rate to protect against the possibility of poor investment returns, a very long retirement, or a combination of the two, while a household with a high level of pension (or similar) income can generally feel pretty safe spending all of that income. Blanchett and Finke found though that the size of the difference indicates that retirees with a low percentage of guaranteed income are likely being even more conservative than they need to be, in terms of spending rate.

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Investing Blog Roundup: Roth IRA Distribution Tool

After recently writing about Roth IRA distribution rules, I was asked to create a tool, so you can just answer a few questions and get the answer as to how your distributions will be treated. So, here it is:

It’s nothing fancy — just a basic tool that guides you to the applicable outcome from the rules we discussed recently.

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Investing Blog Roundup: Which Bond Fund?

This week Jim Dahle did a great job answering the question of which bond fund you should use in a portfolio. Perhaps my favorite thing about the article though is the introduction, in which he makes it clear that this isn’t a critically important question.

Which bond fund to use is an important question in the sense that, when constructing a portfolio, you do have to pick something(s) to use for fixed-income (unless you’re going with an all-stock allocation). But your likelihood of meeting your financial goals is extremely unlikely to be significantly affected by whether you use a Total Bond fund or, for example, an intermediate-term Treasury fund. It’s not even close to one of the most important financial planning decisions.

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Investing Blog Roundup: Long-Term Care Needs

Long-term care is one of the trickiest topics in financial planning. The potential costs are quite high, yet the available insurance products leave something to be desired.

Three researchers with the Center for Retirement Research at Boston College recently sought to answer a few of the questions that you have likely asked yourself: how likely are you to need long-term care? And how likely are you to need a severe level of care as opposed to a more minor level of care? And how long is your need for care likely to last?

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