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When the world seems unhinged, doing something feels a whole lot better than doing nothing. But that doesn’t mean it’s wise.

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What do we Americans want? We want “free” healthcare

"You have to be careful looking at health outcomes. Our health care quality is fine. Many of the outcome comparisons are affected by population and lifestyle differences. And of course millions with limited access to care. We are the most obese country in the world outside of a few Pacific islands. High infant death rates are not because of quality, but access and parent lifestyles. Other countries accept as normal waiting times and other limitations. Americas think more care and faster care and often duplicate care is always better. It isn’t. Compare the number of MRI scanners in the U.S. They have to be used to pay for them. Only Greece has more per 100,000 population. Ireland has less than half the U.S. Some countries a third. I can drive to six major hospitals in 20 minutes or less. That may not be efficient."
- R Quinn
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Quiet Failure: Time for Me to Say What I Think

"I think your definition, the whole para starting “I’ve come to believe…,” is a really good one. While it may be that “The vision comes first. The numbers come second”, I think the vision does need to be grounded in some reality of conceivable numbers, or no amount of financial planning is likely to realize it. "
- Michael1
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Defining Enough

"I think too many of us focus on asset accumulation, returns and spending in retirement. These are very important, but other areas are also very important such as healthcare, estate planning, tax strategy, where to live in retirement and others. These are all important and need to be considered in a good retirement plan."
- Jerry Pinkard
Read more »

Celebrating the Win

"Thanks for sharing your story, David."
- Sanjib Saha
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Not missing the point

"I think that pretty much nails it. I'm a planner (as you may have guessed): For my hikes tend to have plans B and C for things that matter (eating, shelter, etc). Pretty sure that's also a proxy for wanting control of the situation. My financial planning probably has the same motivation. The trick here I think is to internalize the "serenity prayer" (accept what you can not change, change what you can, know the difference). The accept part I think is the hardest for planners. "The best layed plans of mice and men..." Thanks for reminder, and may the "accept what you can not change" go well for you."
- eludom
Read more »

Better Alternatives to Buying an Annuity

"I recognize that financial planning isn't a one size fits all strategy. I assume we all accept that reality. I'm no fan of annuities and my calculations say they are a bad deal for most. However, the peace of mind that it gives some cannot be underestimated. I'd never buy one because as Roth states, I can create my own income streams at a much lower cost while retainingcontrolof my money. Some people may think an annuity is beneficial to them and it's the job of the advisor to point out all the options available and help them chart the best course. All that said, I understand the point made by Roth but I have no issues if folks want annuities if it makes them sleep better at night."
- Mike Xavier
Read more »

What Remains: Money and Me

"Thank you Jeff or those generous words. When I first began writing for HumbleDollar, I never imagined how much I would learn from both the readers and fellow contributors. I'm grateful for the opportunity to share my stories and reflections, and even more grateful for the thoughtful conversations that follow."
- Andrew Clements
Read more »

Would You Be Miserable?

"I suspect most of us would say we wouldn’t like five years of poor market returns, even if our finances could withstand them. There’s a difference between financial security and emotional comfort. One lesson retirement has taught me is that the market and my happiness don’t have to move in lockstep. If my basic needs are covered and the people I care about are healthy, a miserable market would be an annoyance, not a crisis. Easier said than done, of course, when we’ve spent decades being conditioned to cheer every green number. But one lesson Jonathan has taught me, stop checking your account balances every day!"
- Andrew Clements
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It’s The Little Things That Scare Me Now

"Hi Dennis, I found a new little thing based on age. It was recently time for the annual renewal for my umbrella policy. The premium has increased a bit every year since I first got the policy but this year the proposed premium increased over 40% from the prior year. No car accidents, no tickets, no claims of any kind on either the bundled house or vehicle insurance policies, and a credit score in the excellent range. What gives on the increase? Rereading the umbrella declarations I noted the following bullet point - 2 Operators in the household of which 1 is 75 or over. After a call to my insurance company agent of more than a quarter century I confirmed my suspicion that this company deems those of us age 75 and over a higher risk and they were billing me for their statistically higher risk. Apparently, other umbrella insurance companies set a rate increase at age 80 so I am back to renewing my new umbrella policy at a bit of an increase every year for the next five years with a different insurance company but with the same agent. If the time comes when I no longer feel safe driving or the state takes away my drivers license I may forego renewing my umbrella policy. Best, Bill"
- William Perry
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The Ping

"SCao, if my post managed to make even one person smile, it was worth every second I spent writing it."
- Mark Crothers
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Mourning the World

"I lost my brother at 59 years old to Alzheimer’s and Lewy body dementias (he donated his brain to the memory disorders clicic at Mass General. He was non communicative for years before his death as well as unaware of his surroundings as well. At his passing I kept thinking is he in pain, does he hear us, and does he know what is happening? Six months later my father died at 85 of suspected Lewy body dementia and was non communicative for the last six or so months. Then my mother passed away at 85 six months after that after having dementia for more than a decade. She did not recognize any of the family for years. So for the passing of half of my family we could not support them, or know their thoughts as their lives were ending. It was horrible. Last year my mother in law passed away at 103 1/4 and was in complete control of her capacities until the day she passed away. She lived in senior housing until 102 when her husband went to a nursing home and she moved in with us. Other than by age she physically never would have qualified for nursing home care. The way the end of her life ended up going was a blessing for me. For the newer readers of HD you can read my thoughts on her under my David Lancaster profile (I had to create a new profile via Discus due to problems logging on to HD via X."
- DavidHLancaster
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What do we Americans want? We want “free” healthcare

"You have to be careful looking at health outcomes. Our health care quality is fine. Many of the outcome comparisons are affected by population and lifestyle differences. And of course millions with limited access to care. We are the most obese country in the world outside of a few Pacific islands. High infant death rates are not because of quality, but access and parent lifestyles. Other countries accept as normal waiting times and other limitations. Americas think more care and faster care and often duplicate care is always better. It isn’t. Compare the number of MRI scanners in the U.S. They have to be used to pay for them. Only Greece has more per 100,000 population. Ireland has less than half the U.S. Some countries a third. I can drive to six major hospitals in 20 minutes or less. That may not be efficient."
- R Quinn
Read more »

Quiet Failure: Time for Me to Say What I Think

"I think your definition, the whole para starting “I’ve come to believe…,” is a really good one. While it may be that “The vision comes first. The numbers come second”, I think the vision does need to be grounded in some reality of conceivable numbers, or no amount of financial planning is likely to realize it. "
- Michael1
Read more »

Defining Enough

"I think too many of us focus on asset accumulation, returns and spending in retirement. These are very important, but other areas are also very important such as healthcare, estate planning, tax strategy, where to live in retirement and others. These are all important and need to be considered in a good retirement plan."
- Jerry Pinkard
Read more »

Celebrating the Win

"Thanks for sharing your story, David."
- Sanjib Saha
Read more »

Not missing the point

"I think that pretty much nails it. I'm a planner (as you may have guessed): For my hikes tend to have plans B and C for things that matter (eating, shelter, etc). Pretty sure that's also a proxy for wanting control of the situation. My financial planning probably has the same motivation. The trick here I think is to internalize the "serenity prayer" (accept what you can not change, change what you can, know the difference). The accept part I think is the hardest for planners. "The best layed plans of mice and men..." Thanks for reminder, and may the "accept what you can not change" go well for you."
- eludom
Read more »

Better Alternatives to Buying an Annuity

"I recognize that financial planning isn't a one size fits all strategy. I assume we all accept that reality. I'm no fan of annuities and my calculations say they are a bad deal for most. However, the peace of mind that it gives some cannot be underestimated. I'd never buy one because as Roth states, I can create my own income streams at a much lower cost while retainingcontrolof my money. Some people may think an annuity is beneficial to them and it's the job of the advisor to point out all the options available and help them chart the best course. All that said, I understand the point made by Roth but I have no issues if folks want annuities if it makes them sleep better at night."
- Mike Xavier
Read more »

What Remains: Money and Me

"Thank you Jeff or those generous words. When I first began writing for HumbleDollar, I never imagined how much I would learn from both the readers and fellow contributors. I'm grateful for the opportunity to share my stories and reflections, and even more grateful for the thoughtful conversations that follow."
- Andrew Clements
Read more »

Would You Be Miserable?

"I suspect most of us would say we wouldn’t like five years of poor market returns, even if our finances could withstand them. There’s a difference between financial security and emotional comfort. One lesson retirement has taught me is that the market and my happiness don’t have to move in lockstep. If my basic needs are covered and the people I care about are healthy, a miserable market would be an annoyance, not a crisis. Easier said than done, of course, when we’ve spent decades being conditioned to cheer every green number. But one lesson Jonathan has taught me, stop checking your account balances every day!"
- Andrew Clements
Read more »

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Get Educated

Manifesto

NO. 50: WE SHOULD strive to raise financially responsible children. If our kids grow up to make foolish financial mistakes, we’ll likely ride to the rescue—and their problems will be ours.

think

LOSS AVERSION. Behavioral finance experts say we aren’t so much risk averse as loss averse: We get more pain from losses than pleasure from gains—perhaps twice as much. This is why losing stocks cause such anguish. Some react by panicking and selling. But others will double down on losing stocks, taking more risk in hopes of quickly recouping the loss.

act

GET A WILL. Less than half of U.S. adults have a will. Without one, many of your assets will be distributed according to state law, plus you won’t have a say in who becomes your children’s guardian. Some folks don’t bother with a will, because they have a living trust. But when you die, there’ll inevitably be assets outside the trust—and, for them, you need a will.

Truths

NO. 72: EXPECTED return and risk change over time. Historically, commodity futures have delivered great returns and been great diversifiers for stocks—but both qualities have waned, as investors rushed to take advantage. The same may be true for the high excess return from owning value stocks, smaller companies and stocks in general.

Portfolio builder

Manifesto

NO. 50: WE SHOULD strive to raise financially responsible children. If our kids grow up to make foolish financial mistakes, we’ll likely ride to the rescue—and their problems will be ours.

Spotlight: Borrowing

You May Be Surprised

IF YOU’RE LIKE MANY people, you’ll cringe when I mention reverse mortgages. The perception is that they’re loans of last resort for desperate retirees who don’t have any other options. But I suggest keeping an open mind. I believe reverse mortgages can be a shrewd way to unlock liquidity during retirement.
Reverse mortgages have evolved significantly, and retirees are often pleasantly surprised when they learn how today’s loans work. They find that many of the negatives they’ve heard are no longer true.

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So Rewarding

A FRIEND RECENTLY asked me the interest rate on my credit card. I admitted I had no idea. I pay off the balance in full every month and therefore don’t know, or care about, the interest rate.
I’m a minority in this regard. Only 35% of us pay off our credit card balance each month. We’re dismissed as “deadbeats” by profit-hungry credit card companies, perhaps with some justification: We reap the benefits of credit card rewards programs designed to lure the other 65% of the population into using their cards on a regular basis—and then foolishly carrying a balance.

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Debtors’ Prison

IT’S BEEN MORE THAN three years since my wife and I paid off the last of our consumer debt. Since then, we’ve enjoyed the benefits of a debt-free life: less stress, no interest payments and a lower cost of living.
While these reasons alone make a strong case for paying off credit card balances, car loans and other consumer debt, the true cost of borrowing goes beyond the obvious. Here are five drawbacks that I wish I’d considered before taking on debt:
1.

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Keeping It Private

FAMILY CAN BE A wonderful asset. Your parents, siblings and adult children might help with home repairs, offer free advice based on their professional expertise and take care of the dog while you’re on vacation.
When the circumstances are right, I think there’s an opportunity to take this even further. For instance, earlier this year, I provided my daughter with a private mortgage, which allowed her to purchase her first home. There aren’t many people I’d strike that deal with,

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Facing the Truth

WHAT WAS MY DAD thinking when he asked me to help him and my mom with their finances? Did he expect me to give him money? Maybe.
Up until that moment, my dad handled the family finances. Both he and Mom were retired, though my mom still worked occasionally as an adjunct professor. My mom assumed things were okay, though I had my suspicions.
One day, I saw a credit card bill that showed a large outstanding balance,

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Pay It Down

DECIDING WHETHER to buy bonds or pay down the mortgage used to be a tricky decision. Not anymore: Paying extra on your home loan will almost always be the right choice.
This takes some explaining—because it involves wrapping your head around the standard vs. itemized deduction, investment taxes, and a mortgage’s shifting mix of principal and interest.
First, let’s dispense with the obvious objection: Yes, if you’re inclined to buy stocks rather than pay down the mortgage,

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Spotlight: Begley

Taught by My Parents

MY DAD LIVED TO BE age 92 and my mom is going strong at 95. I was involved with my father’s care as he struggled with dementia, and I continue to assist my mother, who still lives independently. Helping an elderly family member? Here are 16 important lessons that I’ve learned. 1. Don’t be blind. My dad started developing dementia five years before his cognitive ability totally fell off a cliff. No one in the family wanted to recognize his deterioration, though my mother—who was his principal caregiver—kept bringing it up. The sad fact is, most people hate to admit there’s a serious health problem because it means they’ll have to deal with it. But it’s almost guaranteed to get worse if you do nothing. 2. Get the paperwork done. My parents had wills and living wills. A will helps determine who inherits your property. A living will details your health preferences for your doctors and loved ones, should you later be unable to express your wishes. I was already an executor and trustee of some family trusts. Dementia was making my dad increasingly confused, angry and paranoid. Dad and Mom had a pretty substantial amount of money. I asked Dad to make out a power of attorney (POA), but I said I didn’t want him to name me. Meanwhile, my mother didn’t have the desire, ability or necessary knowledge to make financial decisions, so she wasn’t an option. Instead, I suggested Dad should grant power of attorney to two of my brothers, who could then act on his behalf if he became incapacitated. This helped to keep him from getting paranoid—because I wasn’t asking for this authority for myself. 3. A power of attorney often isn’t the only piece of paperwork required. Some financial institutions don’t recognize generic powers…
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Shop Till You Drop

HERE'S A RECIPE FOR disaster: a good internet connection, plenty of storage space, lots of time on your hands—and credit cards. Impulsive shopping has a name, oniomania, and the above recipe makes it all too easy. If you have a credit card, research suggests you’ll spend significantly more than if you were paying with cash or a check. The availability of 24/7 online shopping makes it just that much worse. Here are eight signs—besides the pile of packages outside our front door each day—that tells me impulsive spending has reached our house: 1. You get a “charge” each time you place an order. I’m not just talking about the credit card charge. You see something online and you think, “Wouldn’t that be nice to have?” It’s an item you wouldn’t have gone looking for—and wouldn’t have bought—otherwise. Now, with the tap of a few laptop keys, it’ll be delivered to your door. You get the added thrill of waiting for it to come, including tracking its delivery online. 2. You think you’re saving money. We love our Amazon Prime membership and our Amazon Prime 5% cash back credit card. The free shipping, with free returns and Prime Video thrown in, means we’re constantly saving. Problem is, all the money we’re saving puts a big dent in our bank account. 3. You forget what you ordered. My job is to monitor our credit card charges. My spouse doesn’t buy a few big things. Instead, she buys a ton of little things each month. We have a huge amount of small charges on our credit card. I’ve found charges that she initially denied making because she simply forgot about them. I challenged one such charge with the credit card company, only to later admit it was a purchase we’d forgotten about. 4.…
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All Hat No Cattle

IT'S ONLY BEEN relatively recently that mankind has come to rely on banks, brokerage firms and investment companies to build wealth. Tangible property—land, gold bars, houses, livestock and so on—was the standard of wealth just a couple of centuries ago. The Bible frequently cites cattle to signify someone’s wealth. If folks had “cattle on a thousand hills,” they were a billionaire in that era. Wealth was something that you could physically lay your hands on. By contrast, today, we can look up accounts on our computer and, in a flash, determine our net worth. It’s funny when you think about it: Figures on a computer screen can make our spirits soar and plunge. Meanwhile, physical assets can still represent wealth, of course. But some folks take this to an extreme—to their detriment. Let me explain. I’m an accountant by nature and training. Numbers on paper or a computer screen mean real wealth to me. It gives me a feeling of security knowing that my wealth is safely locked in a bank vault or somewhere similar that a thief can’t reach. Yes, scams and fraud exist. But I figure my intangible wealth is mostly safe as long as I act prudently and carefully watch over it. What about physical assets? They just don’t mean that much to me. My wife and I didn’t go for the lavish home when we built our house 32 years ago. Sure, houses can go up in value, but to us it’s just a functional living space. We didn’t build the house because we thought it would be a good investment. Yes, the house has value, but its worth just doesn’t feel as real to me as money on a computer screen. Owning our home does spare us the cost of renting. Yet we still have to…
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Don’t Go There

I'VE MADE A LOT OF investing mistakes in my time. In fact, if I ever wrote a book on investing, the title would probably be Don’t Go There, It Sucks. I’m a Kentucky hillbilly and, yes, that’s hillbilly talk. Another local colloquialism is, “Careful, or you’ll end up like Scrambo Hill.” I don’t know who Scrambo was. But apparently, he resided around our parts at one time, and you don’t want to end up at the bottom of the barrow like him. Let me say first that Cindy and I are financially secure today because we’re supersavers—and despite my investing skills. My two big mistakes are fairly common: trying to time the market and constantly shifting my investment style. You know what? Everybody has heard of Warren Buffett. He’s the senior statesman of Wall Street with an investment record to die for. Has anybody heard of Ken Begley? Uh, doesn’t ring a bell? Well, that’s my name at the top of this column. So, if everybody has heard of Warren Buffett and Warren constantly says that he can’t time the market, why does Begley think he can? That wasn’t a trick question. He can’t or, rather, I can’t. So, why do I try? Out of sheer freaking fear. Here’s what I’ve learned about myself: I have been a part of many a good panic and sometimes led a few. Why? I can’t stand losing money, even if it’s only short-term paper losses, and it sometimes causes me to make rash decisions. I’m not stupid, but sometimes I can be. Cindy and I had accumulated what, for us, was a large net worth in the late 1990s, with a fair amount of our money in the stock market. Even with a relatively conservative portfolio, the sinking and soaring of said market…
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Nothing Saved

THIS IS MY SIXTH STORY for HumbleDollar. You don’t know how happy you’ve made this old hick from Kentucky feel by taking the time to read my stuff, let alone comment on it. I've done and continue to do a lot of dumb things in my walk down life’s path. I hope to share most of them to give you something to think about and maybe avoid on your own. Today, it’s something I call “stupid saving.” Saving is great, but sometimes you really aren’t saving anything. My family is universally known in our town for holding onto money. A local philosopher once said, “If that family lived on an island that had nothing but rocks then, by the end of the year, they would have all the rocks.” That’s just the way we are. We waste nothing and use everything until it’s so worn out that even the Salvation Army won’t take it. Shoot, I bought a car so small and that got such great gas mileage that you could fill up the tank, drive it around all day and still have enough gas by sunset for a sizable explosion if someone runs into you. But enough about me. Or maybe not. I want to give you an example of “stupid saving.” In the country, we tend to have very big yards because land is so cheap. Our house sits on a 1.5-acre plot. To be honest, I hate big yards. But the fellow that sold us the house wouldn’t let me buy any less. So, with big yards come big responsibilities, assuming you don’t want to make the neighbors mad. You’ll do a lot of mowing, raking, weed eating, bush and tree pruning, leaf blowing and so on and so forth. Let me tell you that “so on…
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Learned in Uniform

I SPENT ALMOST 43 years either on active duty or in the reserves for the Navy and Army. Yes, I’ve been around. The following is my list of the top 17 items—including some pertinent financial details—that might surprise those who have never served in the military. No. 1: Our primary mission is not to fight wars. Instead, it’s to be so big, so bad, so mean, so well equipped, so well trained and so well led that any potential enemy in its right mind wouldn’t want to fight us. Failing that, our secondary mission is to fight and win wars. No. 2: If we had a draft, we would be less likely to become involved in armed conflicts. We haven’t had a draft since 1973. If every family faced the prospect of their children serving in combat, there’d be less willingness to go to war unless it was absolutely necessary. As it happens, all males age 18 to 25 are still required to register with the Selective Service System in case a draft is ever reinstated. No. 3: The military doesn’t choose which wars to fight. You and your elected representatives choose wars. The treaties that our government signs generally determine which potential conflicts we become involved in. Political solutions should be a first resort, military action the last. No. 4: We fire a lot of bullets in combat. It was estimated that 50,000 rounds were fired to kill a single soldier in Vietnam. In fact, I was told that automatic weapons with large magazines were invented for the military because we’re notoriously bad shots when under the strain of combat. No. 5: Few people become members of the military. Today, about 0.5% of our population serve in the armed forces. That means that if, you have 1,000 people graduating…
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