We spend a lot of time talking about the importance of diversification. When it comes to stocks, it’s foundational to our investment approach. Investing in a stock portfolio that isn’t properly diversified is like swimming with sharks without a shark cage. You can do it, but there are safer ways. But that’s stocks. Bonds are…

Before we can discuss bonds in depth, it is important that we establish a common understanding of what bonds are and how they work. As a starting point, a bond is a contractual obligation to make a series of specific payments on specific dates. Typically, this includes interest payments made on a semi-annual basis until…

Bonds can be incorporated directly into a retirement strategy in three broad ways: An assets-only approach to build a total returns investment portfolio, Matching the duration of bond funds to the duration of the retirement liability, and Holding individual bonds to maturity to generate the desired cash flows to fund expenses on an ongoing basis…

This report features world capital market performance and a timeline of events for the last quarter. It begins with a global overview, then features the returns of stock and bond asset classes in the US and international markets. The report also illustrates the performance of globally diversified portfolios and features a topic of the quarter.…

Every financial plan is wrong. They’re all shots in the dark. It’s impossible to predict the future, and there’s an almost infinite number of moving parts that will impact your financial life. Also, even if you were to make the best predictions possible, your plan is out of date the instant you finish creating it.…

In addition to other methods we’ve discussed, a third type of variable spending model uses dynamic programming methods. These methods rely on complex computing power and mathematical equations to integrate spending and asset allocation decisions more completely over the life cycle. Dynamic programming provides a road map at each point in time for optimal spending and…

Of all of the different goal types, longevity goals are probably the least intuitive. Your longevity goals are based around the possibility that you will live longer than you expect. That sounds great, but your income plan needs to be able to fund those years of retirement (unless you plan on hustling Pinochle when you’re…

The fiduciary rule has been in the news again lately, as some members of Congress have been trying to “delay” it so they can “study” its impact. In other words, kill it. But there’s some interesting data that suggests that, at least in the long term, this is moot. Cerulli Associates has found that young…