You’ve heard the saying before that there are a few guarantees in life: death and taxes. I’d also like to add another: guaranteeing yourself a rate of return. I get asked this question frequently, usually by someone who’s a conservative investor or someone looking for a “sure thing”. This is what I tell them and I am telling you. Call this your money back guarantee. For the majority of readers, this will come into play as most of you have debt in some form or another. Whether it’s your mortgage, automobile, boat, credit cards, college, many Americans have different amounts of debt all at different interest rates. Typically, your consumer debt (credit cards) is going to have the highest interest rates. Here’s how to guarantee yourself a rate of return: PAY DOWN YOUR DEBT. By paying down your debt you will be guaranteeing yourself the rate of return equal […]
investment
How Dollar-Cost-Averaging Can Work to Your Advantage for Your 401(k)
When you invest in your 401(k) plan with salary deferrals from each and every paycheck, you are taking part in a process known as Dollar-Cost-Averaging (DCA). This process can be advantageous when investing periodically over a long span of time, by smoothing out the volatility of the market and giving you an average cost of your investment shares over time. How does this work, and how can it be advantageous? Dollar-Cost-Averaging When deferring income with each paycheck, typically you will be investing in your 401(k) plan each pay period, whether monthly, bi-weekly, or weekly. Each pay period the same amount is deferred and invested, no matter what the price of the underlying investments are at the time. Since you’re always putting the same amount into the investment, when the price of the shares is higher, you purchase fewer shares; when the price is lower, you are purchasing more shares. Note: […]
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Why Designations Matter
Throughout my career I have had the occasion to talk with several financial advisors, planners, insurance agents, brokers, and other industry professionals about some of the reasons why people choose to pursue or not to pursue designations. I have heard differing views on the topic and thought I’d share some of my insights as to why I chose and still choose to pursue designations and degrees. Before I do, let me start by talking about some of the reasons why the advisors I have spoken to decide not to earn a designation. More often than not, the typical answers that I receive are not having enough time, not sure which designation to pursue, lack of funding to afford the designation, and lack of support on earning the designation – either from their employer or family. On the latter two points, some companies may not be able to “support” the designation […]
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How to Keep Your Sanity When the World Around You Isn’t
In my current re-read of Benjamin Graham’s timeless book “The Intelligent Investor”, I ran across the following paragraph and was immediately struck by the simple, deep truth in the lines: But note this important fact: The true investor scarcely ever is forced to sell his shares, and at all other times he is free to disregard the current price quotation. He need pay attention to it and act upon it only to the extent that it suits his book, and not more. Thus the investor who permits himself to be stampeded or unduly worried by unjustified market declines in his holdings is perversely transforming his basic advantage into a basic disadvantage. That man would be better off if his stocks had no market quotation at all, for he would then be spared the mental anguish caused him by other persons’ mistakes of judgment. Jason Zweig, in his notes for the […]
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Book Review: Abnormal Returns – Winning Strategies From the Frontlines of the Investment Blogosphere
I wasn’t sure what to expect when I opened this book. After all, the subtitle could lead one to expect some sort of sensationalistic attention-grabbing sort of “get rich quick” scheme. I was pleasantly surprised, to say the least. I had not read any of author Tadas Viskanta’s writings prior to this book (I’ve since resolved that shortcoming – see Abnormal Returns, you won’t be disappointed!), so I didn’t realize how insightful and reasoned Mr. Viskanta’s commentary could be. What he has produced in this book is an excellent overview of the components of the investment environment these days. This book should be required reading for anyone who is investing these days – especially for the non-professional investor who is going it alone, without a professional advisor. The author starts off with a thorough explanation of the concepts of Risk and Return, and then explains the basics of Stock (Equity) […]
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Book Review – Backstage Wall Street
This was a good book, I truly enjoyed reading it. The primary reason that I enjoyed it so much is because it’s the book I have been hoping to find from someone like author Joshua Brown: a book that tells the truth about what’s really going on on the seamy side of Wall Street (which is the only side, to be truthful). Joshua Brown (TheReformedBroker.com) provides a unique perspective – that of someone who has been involved in the “inside” of wirehouse broker-dealers, but who has since seen the light and moved on to a career in independent investment advice. As such, Mr. Brown has seen the worst of the worst, in terms of how these institutions treat the investing public. Once he became aware of how it all worked, through a great degree of soul-searching (and a whole lot of gumption), stepped away from it all and has never […]
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Book Review: The Wall Street MBA
This book, by Mr. Reuben Advani, sets out to cover much of the pertinent information required in an MBA program within its pages, and I think it does a good job of meeting this goal. Mind you, I don’t have an MBA degree so I can’t say with certainty that the goal is accomplished, but I’d have to say that the book does an excellent job of hitting all of the important points of required knowledge, specifically as it relates to investing and individual company valuation. I liked this book, but then again I’m kind of an out-of-the-ordinary accounting/investing geek. Where I have some confusion with this book is in understanding who is the target audience. The problem is that the subject matter gets pretty involved in accounting principles that can be overwhelming to the average individual – potentially so much that the average individual may lose interest. On the […]
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About to Graduate? Learn How to Save!
Hey, soon-to-be-graduates: as you begin to make your way out into the world of full-time employment, you’ll soon be faced with many, many “grown up” ways to spend the money you’ll be earning. You’ll of course have rent, insurance, food and clothing, maybe a car payment, and you’ll want to use some of that new-found money to blow off steam, however you choose to do that – maybe fulfilling a lifetime dream of getting “beaked” by Fredbird, for example. If you’re on top of your game, you’ll may also be thinking about saving some of your earnings. Here, you’ll have a bundle of options to choose from – regular “bank” savings accounts, 401(k) plan (or something similar) from your employer, and IRA accounts, both the traditional deductible kind and the Roth kind (hint: the Roth kind is what I want you to pay particular attention to). Side note: even if […]
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Book Review: Investment Mistakes Even Smart Investors Make
This book is a must read for all investors. Author Larry Swedroe has demonstrated once again how he has a full understanding of the average investor’s situation, by listing 77 real-life mistakes that all of us have encountered at one time or another. What’s more, Mr. Swedroe also takes the time to provide examples of where the mistakes listed have damaged investors’ situations, as well as to show how the investors could have avoided the mistakes. Larry Swedroe, for the uninitiated, is a best-selling author of many books which explain his concepts of investing – including The Only Guide series, The Quest for Alpha, and others. These books cover primarily passive investing, or investing without active management, and as such he is a sort of guru in the self-managed investment world. The listed mistakes in this book include everything from hindsight bias (believing after the fact that a particular occurrence […]
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Book Review: Investing and the Irrational Mind
This was an interesting book for me. I found that the research that author Robert Koppel has compiled from various sources throughout academia lends a great deal of insight into the “why?” of activities by individuals, professional traders, and others that take part in the great game of investing. Even though the majority of the discussion and analysis that Koppel brings forth deals with professional traders, the behavioral psychology applies to individual, non-professional investors as well. An example of a particularly interesting passage is one where Koppel quotes Nassim Taleb from his book, The Black Swan – effective responses to Black Swan Events (such as the 2008 economic crisis or the 9/11 crisis): What is fragile should break early, while it is still small. Nothing should ever become too big to fail. There should be no socialization of losses and privatization of gains. People who were driving a school bus […]
Sterling Raskie, MSFS, CFP®, ChFC®
The latest in our Owner’s Manual series, A 401(k) Owner’s Manual, was published in January 2020 and is available on 
A Medicare Owner’s Manual, is updated with 2020 facts and figures. This manual is available on 
Social Security for the Suddenly Single can be found on Amazon at 
Sterling’s first book, Lose Weight Save Money, can be 
An IRA Owner’s Manual, 2nd Edition is available for purchase on Amazon. Click the link to choose the 
Jim’s book – A Social Security Owner’s Manual, is now available on Amazon. Click this link for the 
And if you’ve come here to learn about queuing waterfowl, I apologize for the confusion. You may want to discuss your question with Lester, my loyal watchduck and self-proclaimed “advisor’s advisor”.