Behavioral Finance 101 (Part 2)

February 12, 2019February 12, 2019 ~ Investing Forever

Key Points

Irrational behavior, although common, can degrade investment returns over time.
In order to invest wisely, it’s important to understand where investors often get tripped up.
Recency Bias is the notion that we often overemphasize recent events over longer-term averages when making decisions about uncertain future events.

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Why Invest Forever? (Part 8)

February 5, 2019February 11, 2019 ~ Investing Forever

Key Points

Assuming a 7.2% annualized real return (including reinvested dividends), an investment will double in value about every 10 years following the rule of 72.
However, even with more modest assumptions significant wealth can be generated over time.

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Why Invest Forever? (Part 7)

January 29, 2019February 5, 2019 ~ Investing Forever

Key Points

The rich continue to get richer, where the top 26 richest humans now control more wealth than the bottom 50%, based upon recent research from Oxfam.
Wealth has the capacity to grow exponentially after reaching a tipping-point, which can lead to a strong concentration of wealth among a small percentage of owners.
If you can’t beat ’em, join ’em.

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Passive is the New Aggressive (Part 8)

January 22, 2019February 5, 2019 ~ Investing Forever

Key Points

Jack Bogle, the father of the index fund, passed away on January 16, 2019, and over his career Bogle pioneered the philosophy of passive investing for the common investor.
Bogle founded and built The Vanguard Group into the world’s largest mutual fund company, with over five trillion in assets under management (AUM). Continue reading “Passive is the New Aggressive (Part 8)” →

Why Invest Forever? (Part 6)

January 15, 2019February 5, 2019 ~ Investing Forever

Key Points

Assuming a 7.2% annualized real return (including reinvested dividends), an investment will double in value about every 10 years following the rule of 72.
Given this rate of return, $1 can grow to $1000 after 100 years and $1 million after 200 years.
After enough gains in capital, incremental income can be consumed on a go-forward basis (practically indefinitely), without eroding the capital base (note: restrictions apply).

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