When I say “risk” and you say “risk,” chances are high we don’t mean the same thing. The finance industry defines risk as something measurable. It is variability within a set of known limits. You may have heard it referred to as standard deviation or even volatility. Ultimately, it represents how much an investment wiggles …Read More.
Calm water makes a lifeboat drill much easier. We aren’t fighting the waves or the fear we feel during an emergency. Still, if the worst happens, and the drill becomes reality, at least we’ve rehearsed. We’ll know exactly what we are supposed do. With the markets relatively calm, now is the perfect time for an …Read More.
“I can’t believe you see it that way!” Just last week, I said this to my wife in the middle of a discussion (O.K., a fight) about money. We were experiencing something many of you have probably also faced. We needed to make a very important financial decision about how much of an emergency fund …Read More.
“Can it really be that simple?” Over my career, I’ve heard these words from so many people. Clients, friends and family all just assumed that the process of financial planning needed to be complex. This assumption doesn’t surprise me. The traditional financial industry is built, in large part, on the notion that complexity equals quality. …Read More.
We left the trail head at 1 a.m. and headed for the summit of the Grand Teton. I had made this climb several times, but my friend was still new to mountaineering. This trip was his first attempt at the popular peak. Our goal was to reach the top by sunrise so we had enough …Read More.
Human beings don’t like uncertainty, especially when we’re contemplating our financial futures. It’s not enough for us to think that we’ll have enough money to send our kids to college, or to retire. We want to know exactly how much money we’ll need to achieve those goals — and precisely how we’re going to get …Read More.
When I look at hedge funds, there are three data points that keep bothering me. They create a pattern that doesn’t make a lot of sense. I hope you can help me understand what I’m missing. 1. Hedge fund performance has been terrible. In 2014, the Barclay Hedge Fund Index returned 2.88 percent. In that …Read More.
Almost everything we’re taught about money is focused on spending it and saving it. Parents, teachers and even personal finance books discuss saving money as keeping it, increasing it and controlling it. Saving money involves figuring out ways to get more of it, to build a bigger cushion. We’re taught that’s the ultimate goal. In …Read More.
What feels safe is often risky, and what feels risky is often safe. This statement contradicts just about every evolutionary instinct we possess. We tend to seek out safety and avoid risk whenever possible. A classic example has to be the instinct that (still) tells us we are safer staying with the group. If members …Read More.
On and off over the years, I have used a training app called Strava. It allows you to keep track of your performance on different biking, running and skiing trails. You can even break down overall times into sections or compare your performance over the entire trail. Last year, in an attempt to get back …Read More.