Better Long-Term Portfolio Performance
Studies have shown that investors who use a financial advisor experience better long-term portfolio performance because they are more likely to adhere to their strategy and thus reach defined investment goals.
Rate Your 401(k) Plan
Fees are one thing that you definitely can and should control in your investment portfolios. 401(k) plans are notorious for making it difficult to figure out how much you’re paying in fees. BrightScope offers a free tool that shines a light on this dark area. Try it out and be a better informed investor.
BrightScope | 401k Plan Ratingshttp://www.brightscope.com/BrightScope quantitatively rates 401k plans and gives participants, plan sponsors, asset managers, and advisors tools to make their plans better.
“Wolf” Market?
Bull market? bear market? How about a WOLF? A wolf market is characterized by a tight trading range, increase volatility, high stock correlations and quick reversals. We’ve been in a wolf market since April or earlier.
Real-Estate Investing
Real-Estate Investing: the best and worst markets for single-family real-estate investment properties.
Real-Estate Investing: the Best and Worst Marketshttp://online.wsj.comLooking to snap up some investment properties on the cheap? You may want to consider Durham, N.C., Indianapolis and Huntsville, Ala. They are among the best places to invest now, according to a new report that ranks the best and worst markets for conservative residential-real-estate investors.…
Raiding Your 401(k)? Think Twice…
Think twice before raiding your 401(k) for a loan. You pay taxes on the withdrawl at your personal income tax rate and you may be subject to a 10% penalty. You miss out on potential market gains on the amount you cashed out. Double taxation — you repay the loan with after-tax dollars and you’ll be taxed again at distribution. Finally, if you change jobs, you usually have to repay the loan immediately.
Investor Life Cycle ~ Net Worth
It’s interesting to think about how your net worth changes over your life time. This chart does a great job illustrating the typical trajectory
Perils of Emotional Investing
“So many people get scared when everyone says the sky is falling. They get out of equities and into bonds when it’s exactly the wrong time to do it. When everything is sky high and everyone is optimistic, they then plow back into equities. Their emotions do the wrong thing. “
— Dr. Burton Malkiel (author of A Random Walk Down Wall Street)
Hidden Costs of Mutual Funds
MUST-READ article on the “hidden costs of mutual funds”. Study shows the average annual trading costs (commissions, spreads, market impact and opportunity costs) of mutual funds to be about 1.44% IN ADDITION to the publicly disclosed expense ratio, which averages another 1.3.% per year. That means the average fund costs 2.75% per year!
Mutual Fund Trading Costs Go Unreportedhttp://online.wsj.comIn selecting mutual funds, most investors know to check the expense ratio, the standard measure of how costly a fund is to own. U.S.-stock funds pay an average of 1.31% of assets each year to the portfolio manager and for other operating expenses, according to Morningstar Inc.
72% of Small Company Employees Have No Retirement Plan
72 percent of workers in small companies don’t have retirement plans available to them. Some firms don’t set up plans because of the cost. [U.S. Small Business Administration’s Office of Advocacy, March 2010 via WSJ].
Pitfalls of Money Management
Common pitfalls with managing money:
[from NPR’s economics editor Chris Farrell]
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