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What Remains: Money and Me

Andrew Clements | Jun 10, 2026

"A beautiful tribute to Jonathan as well as a thought provoking question for all of us! Thanks, Andrew."

- Brian Frisch

Would You Be Miserable?

Dan Smith | Jun 8, 2026

"Fun Fact , Twinkles we're originally banana . But when the war started all bananas were sent to the soldiers so Hostess started using vanilla filling instead"

- Larry

How to Use AI With Your Portfolio

W.D. Housley | Jun 9, 2026

"Of course, but AI is getting better and better all the time. Right now it may be in grade school. But it seems that High School and College are around the corner. Question did these writers evaluate AI too soon?"

- W.D. Housley

The Ping

Mark Crothers | Jun 4, 2026

"Hi Mark, you have a great sense of humor. I cracked up reading, “Apparently the Vinted business model includes free delivery, and it turns out I am the free delivery.” Hey, happy wife, happy life!"

- SCao

Mourning the World

Jonathan Clements | Jun 5, 2026

"It is a gift to be able to read Jonathan’s writing. He is deeply missed by many of us, and his legacy lives on through his words."

- SCao

Moving is Expensive!

DrLefty | May 29, 2026

"Congratulations on the move, Dr. Lefty. It is certainly a huge event and takes a lot of effort. Glad to hear you are settling in."

- SCao

Reflections on a Quiet Failure

Javier Escobar | Jun 7, 2026

"Yes, that's exactly what you said; my bad."

- Dan Smith

Peter Cancro from age 14 to 69 covered in oil and vinegar

R Quinn | May 31, 2026

"I like their turkey club. I’m going to try the cheesesteak though."

- R Quinn

Bucket Strategy

ArticleAdam M. Grossman | Jun 6, 2026

A WHILE BACK, I was speaking with a fellow who had recently retired. He shared this observation, only half-jokingly: “Working was easy,” he said. What he meant was that financial management during our working years is more straightforward than it is in retirement. We earn and save and hope that our savings grow. But when we get to retirement, it becomes more complicated to know exactly how to manage those savings. In the 1950s, a Ph.D. student named Harry Markowitz developed a framework to help investors answer this question. His approach, which is now known as modern portfolio theory, provided new insights on how to effectively diversify a portfolio. He later won a Nobel Prize for this work. But useful as it was, modern portfolio theory involved a lot of math and didn’t offer investors any practical help in managing their savings. Other academic theories have emerged over the years, but all of them involved similar levels of complexity. It was for that reason that in 1985, financial planner Harold Evensky developed an idea that’s now known as the “bucket strategy.” The idea is that investors—especially those in retirement—should segment their portfolios. To understand this idea, we can look at a simple example. Suppose Tom is a recent retiree and planning to withdraw 5% of his portfolio each year for the next several years. To protect against a potential stock market downturn, it would be reasonable for him to hold five years worth of withdrawals in some combination of cash and short-term bonds, since that corresponds, more or less, to the length of the worst stock market downturns we’ve seen in modern times. In Evensky’s model, cash and bonds would be the first bucket, and the math is straightforward: If Tom wants to withdraw 5% each year and wants to set aside enough for five years, then he’d hold 25% (that is, 5% x 5) in the first bucket. With that 25% allocated to bonds for stability, Tom could then feel free to allocate the remaining 75% to stocks. The benefit of this structure is that Tom would then have the flexibility to withdraw from either the stock or bond side of his portfolio depending on where the stock market stood in any given year. Most importantly, by putting a wall between his stocks and his bonds, Tom would be able to avoid selling stocks during market downturns. The bucket concept can be very useful, but it’s important to know that there isn’t just one bucket strategy. Since Evensky first introduced the idea 40 years ago, a handful of alternatives have evolved. Evensky’s original structure consisted of just two buckets. This makes it simple and easy to manage. A downside, though, is that bonds can still lose money, so neither of the two buckets could be considered truly safe. In 2022, in fact, total-bond market funds lost more than 10% of their value, and it took several years for investors to get back to even. Thus, one of the most popular ways to structure a bucket portfolio is to add a third bucket, for cash. To be sure, cash doesn’t offer much growth potential. But it would’ve been extremely helpful in a year like 2022, when both bonds and stocks lost money. While it provides more protection, the downside of a three-bucket approach is that it’s more complicated and somewhat harder to manage. Proponents, however, argue that it doesn’t require much more effort than traditional portfolio rebalancing and is well worth the effort. In his book, The Aspirational Investor, Ashvin Chhabra lays out another bucket alternative. Chhabra is less concerned with the distinction between bonds and cash. Instead, he advises investors to focus on the riskier side of their portfolios. He suggests that investors distinguish between standard, publicly-traded stock market investments and any alternative assets, such as private funds and real estate, that they might hold. Chhabra feels this segmentation is important because of the nature of alternative investments. They’re a little like lottery tickets: They can turn into home runs but can also go to zero. If you’re constructing a portfolio and like the idea of a bucket approach, which way should you go? Since each of these approaches has merit, you could combine them all, creating a four-bucket setup, consisting of cash, bonds, stocks and alternatives. That wouldn’t be unreasonable, but it would also ratchet up the complexity level. Here’s the approach I recommend: First, like Chhabra, I would draw a distinction between traditional assets and alternatives. Traditional, publicly-traded investments, including standard stock and bond mutual funds and ETFs, would go in your core portfolio. These are the assets around which you’d build your plan. Alternatives, if you own them, would go in their own separate bucket. In general, I don’t recommend these types of assets because their performance is more variable and more unpredictable, and because they tend to carry higher fees. But if you already own some alternatives, I’d separate them from your financial plan and view them only as a bonus if they deliver value. In other words, make sure that your financial plan will still work if you were to rely on only your core portfolio. Within the core, I’d have just two buckets: one for stocks and one for bonds. The result is that you would have just two buckets, plus alternatives, if you happen to own them. But what about cash, since, as we saw earlier, bonds aren’t guaranteed and can certainly lose money? In my view, a dedicated, separate cash bucket isn’t necessary. Instead, what I recommend is to be diligent in diversifying your bond holdings. I wouldn’t own a total-bond market fund. Instead, take a building block approach, holding some short-term and some intermediate-term bond funds. Short-term funds will shine when rates are rising because they’ll decline much less than total-market funds. Intermediate-term bonds, on the other hand, will shine when rates are dropping. You could also add some inflation-protected bonds to round out your holdings. At the end of the day, the best portfolio structure is the one that’s simple to manage while also protecting your savings from whatever surprises the market delivers. Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and check out his earlier articles.

Time to share our financial info with children?

R Quinn | Jun 6, 2026

"I urge you to share, RDQ, with all four of your children. I suspect it will remove a huge, perhaps subconscious, load from your shoulders. My father began sharing his financial information with me, an only child, when I was in my 20s. Then, I hated it, as he reviewed his accounts and investment deliberations in great detail; I barely had the patience to listen. I also never counted on inheriting (the step family situation was fluid), and these talks did not alter my savings path. Over time, I grew to respect my father for sharing. I learned much, too. As his eventual executor, my understanding of his finances made my work that much easier. I already had a checklist. And the best part was that my father asked what I would do were I to inherit. We spoke of philanthropy and it pleased him to know that his money would be put to good use. He passed two decades ago, but I feel him with me to this day as I realize my giving plans."

- Jo Bo

A $1,000 Conversation With My Daughter

Mark Crothers | Jun 7, 2026

"Dan, my youngest daughter has never been great at listening to her old dad — so I figured I'd meet her where she lives. Sent it to her on WhatsApp. Funny how a phone screen carries more authority than I do. 😉"

- Mark Crothers

The Quiet Failure of Good Advice

Javier Escobar | May 29, 2026

"Do you spend exclusively out of your equities until a downtrend? And if so, how do you define a downtrend/tizzy to make the switch from spending from equity allocation to begin spending from cash allocation?"

- Andy Morrison

What Remains: Money and Me

Andrew Clements | Jun 10, 2026

"A beautiful tribute to Jonathan as well as a thought provoking question for all of us! Thanks, Andrew."

- Brian Frisch

Would You Be Miserable?

Dan Smith | Jun 8, 2026

"Fun Fact , Twinkles we're originally banana . But when the war started all bananas were sent to the soldiers so Hostess started using vanilla filling instead"

- Larry

How to Use AI With Your Portfolio

W.D. Housley | Jun 9, 2026

- W.D. Housley

The Ping

Mark Crothers | Jun 4, 2026

- SCao

Mourning the World

Jonathan Clements | Jun 5, 2026

"It is a gift to be able to read Jonathan’s writing. He is deeply missed by many of us, and his legacy lives on through his words."

- SCao

Moving is Expensive!

DrLefty | May 29, 2026

"Congratulations on the move, Dr. Lefty. It is certainly a huge event and takes a lot of effort. Glad to hear you are settling in."

- SCao

Reflections on a Quiet Failure

Javier Escobar | Jun 7, 2026

"Yes, that's exactly what you said; my bad."

- Dan Smith

Peter Cancro from age 14 to 69 covered in oil and vinegar

R Quinn | May 31, 2026

"I like their turkey club. I’m going to try the cheesesteak though."

- R Quinn

Bucket Strategy

ArticleAdam M. Grossman | Jun 6, 2026

Manifesto

Jun 10, 2026

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.

act

Jun 10, 2026

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

Jun 9, 2026

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.

think

Jun 8, 2026

REBALANCING. For major market segments—emerging markets, high-quality bonds, small-cap stocks and so on—we should have target portfolio percentages. Every so often, we should bring our portfolio back into line with these targets, preferably making any sales in a tax-deferred account. Rebalancing controls risk—but it can also boost returns.

Money Guide

Manifesto

Jun 10, 2026

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: Investing

Mega Backdoor Roth

Bogdan Sheremeta | Jun 6, 2026

I WAS RECENTLY asked about strategies that high earners can use to reduce their tax bill.
Most people know the usual options. They contribute to a 401(k), fund a health savings account or make a Roth IRA contribution through the backdoor method. Business owners may have additional opportunities through retirement plans and business structures.
But there’s another strategy worth knowing about: the Mega Backdoor Roth (MBDR).
The MBDR allows some workers to put far more money into Roth accounts than the usual contribution limits permit.

Index Fund Bubble

Adam M. Grossman | Dec 6, 2025

CRITICS OF INDEX FUNDS are pursuing a new line of attack. Passive investing, they argue, is distorting market prices and creating an unhealthy bubble.
To be sure, the market today is expensive. The price-to-earnings (P/E) ratio of the S&P 500 stands at about 22. That’s substantially above its long-term average of about 16. Of more concern, that metric is approaching a level not seen since the market peak in 2000, just before stocks dropped 57%.

Money and Me

Adam M. Grossman | May 30, 2026

JONATHAN CLEMENTS’S final book was released this week. Titled Money and Me, it traces the arc of Jonathan’s nearly four-decade career as a personal finance columnist.
Money and Me starts with the story of a man named George Cope, who was a nineteenth century tobacco baron. At the time of his death in 1888, Cope was one of Britain’s richest men. But within just two generations, his fortune was gone.

Economic Trends

Adam M. Grossman | Mar 14, 2026

LAST WEEK THE government released its monthly employment figures for February. The results weren’t great. Payrolls declined, and unemployment ticked up. These numbers square with other downbeat data, including a recent uptick in bankruptcy filings.
Another worry: Oil prices have been rising, a result of the conflict in the Middle East. That’s a concern because it could lead to a reacceleration of inflation. It could also dampen consumer spending because higher gas prices act like a tax on consumers,

Wall Street Trap

Adam M. Grossman | May 2, 2026

IN THE INVESTMENT world, May 1st is a notable day. It was on May 1, 1975 that the Securities and Exchange Commission deregulated the brokerage industry. For the 183 years prior to that, trading commissions on the New York Stock Exchange had been fixed at uniformly high rates. But when deregulation arrived, competition got going. That’s when discount brokers like Charles Schwab got rolling, and over time, May Day, as it’s now referred to,

Personal Finance Reading List

Adam M. Grossman | Dec 20, 2025

LOOKING FORWARD TO some downtime over the holidays? Below are some favorite new personal finance books and articles to consider for your reading list.
A Richer Retirement by William Bengen – Back in the 1990s, financial planner William Bengen developed what’s come to be known as the 4% rule. It’s a framework to help retirees determine a sustainable portfolio withdrawal rate. This year, Bengen updated and expanded his research. The most compelling addition: Bengen addresses the question of asset allocation.

Penniless at Last

John Yeigh | Jul 19, 2022

IN AN EARLIER ARTICLE, I noted that my savings journey began in 1960 with a couple of jars of pennies that I started collecting at age five. I was following family ancestor Ben Franklin’s maxim that “a penny saved is a penny earned.” One of my uncles also had an interest in coin collecting. He and I began to actively search through countless penny rolls to find pennies with dates that we didn’t have. We bought Whitman coin albums and organized our pennies by date from the earliest Lincoln head pennies from 1909 up through the 1960s. We expanded our collection to include sets of Buffalo and Jefferson nickels, Mercury and Roosevelt dimes, and Washington silver quarters, plus any older coin we happened upon. Occasionally, we found Indian head pennies, Liberty nickels, Barber dimes or Walking Liberty quarters still in circulation. These dimes and quarters contained 90% silver through 1964, so they had a recognized commodity value. Our coin-collecting hobby lasted for eight years. During those eight years, we amassed five nearly complete Lincoln penny sets, missing only the rare 1909 penny minted in San Francisco with the initials V.B.D. for its engraver. One of these pennies in fine condition can cost more than $1,000. We had jars of old duplicate pennies as well. We assembled a couple of complete sets of Jefferson nickels and Roosevelt dimes. Our most valuable collection was the three nearly complete sets of Mercury dimes, lacking only a rare 1916 10-cent piece minted in Denver. We accumulated plenty of duplicate year silver coins as well. My uncle passed away in 1968 due to complications from polio, and my interests shifted. That’s when my coin collection went into hibernation, stored in various basements untouched for 50 years. [xyz-ihs snippet="Mobile-Subscribe"] I have no interest in pursuing this hobby…

While We’re Waiting

John Yeigh | Mar 27, 2020

IN RECENT WEEKS, my wife and I have seen scheduled activities for the next few months come crashing down. Two long-planned vacations with friends, our various volunteer work and our son’s college semester have all been cancelled. It appears we’ll be effectively quarantined at home for the next two or three months. That means plenty of time to worry about—and work on—our investment portfolio. But it’s also a great chance to bring greater order to our household assets: Every year, our neighborhood rents a couple of dumpsters for spring cleaning. In years past, I was an occasional dumpster patron. But over the last few days, I’ve divested years of junk-room accumulations. The cleaned-up room felt even better than a market rally. As part of this divestment exercise, I listed four dust-collecting assets on Craigslist, including a carpet and some sporting equipment. Two have already sold. Taking huge losses never felt so good. We have three cars, including two that are 15 years old and in need of repairs that would cost far more than their scrap value. Our home quarantine has allowed us to start internet shopping in earnest. We checked out one vehicle in person. The typical dealership glad-handing had completely disappeared. The other good news: Right now, quality used cars aren’t likely to sell out so fast. Closets and drawers, need I say more? If you need an incentive to get going, book a charity pickup for a week from now. You’ll then have a forced deadline to donate those 1970s paisley shirts and bellbottoms. Our rear deck is 40 years old and has long needed replacement. We finally got around to shopping for materials and colors on the internet, while also arranging for contractors to visit to give us estimates. One contractor volunteered that his future docket…

Off the Payroll

John Yeigh | Jan 30, 2019

WHEN OUR DAUGHTER landed a great job after her 2018 college graduation, we expected her to soon move off the family payroll. She immediately budgeted to take on all routine living expenses, including housing, food, car and utilities. We did volunteer to cover some smaller expenses, largely in situations where family plans are available, such as cellphones, Netflix, Amazon Prime and AAA. We also kept her on our employer-provided health insurance, which involved no added cost. Today, a third of millennials still live at home. I get it. Young adults may be seeking a job, continuing college studies, saving for a down payment or wedding, temporarily displaced, or simply lazy or fearful about entering the workforce. Even if they move out, many others receive parental financial help, similar to what we planned for our daughter. But in our case, parental help turned out to be far larger than we expected. My daughter’s first big challenge was finding a place to live. In her new city, tiny apartments rent for some $2,000 per month. These apartments were too small to store snow tires, camping gear, skis and other stuff that should now be hers to manage. I also struggled with throwing away $24,000 a year on rent. That’s when I suggested she look into buying. This was a seismic shift from the original plan. Suddenly, our daughter had to step up and earn an instant PhD in real estate. She quickly learned that buyers get what they pay for—and that location, location, location is everything. Two important criteria were neighborhood safety and resale potential. After all, she might get a job transfer—a frequent occurrence early in a career. After considering many cheaper dumps, our daughter landed on a three-bedroom townhouse with a basement. It struck all of us as a solid value.…

A Path to $10 Million

John Yeigh | Feb 13, 2023

JEFF BEZOS ONCE asked Warren Buffett why everyone doesn’t just copy his example when investing. Buffett famously replied, “Because nobody wants to get rich slowly.” The magic of saving diligently, coupled with decades of compounding inside tax-advantaged accounts, can ensure financial freedom. In fact, young married couples today have an outside chance of accumulating $10 million by the time they reach the new required minimum distribution age of 75. To reach the $10 million jackpot, a couple would both have to save the maximum allowed in their 401(k) or 403(b) from age 22 to 62, plus earn a 4.5% average annual return on that money from age 22 to 75. Hard to fathom? Here’s the math behind their fortune. In 2023, workers can contribute a maximum of $22,500 per year to tax-deferred plans, which would translate to $900,000 of total contributions over a 40-year career. Assuming a 4.5% annual return, the contributions would grow to be worth $2.5 million at age 62. Many workers also receive a company match on their contributions. Let’s assume a 3% match on $60,000 of annual earnings. This adds another $1,800 a year, or $72,000 over 40 years. With a 4.5% annual return, the company contributions would grow to be worth $201,000 at age 62. Starting at age 50, workers can add $7,500 in catch-up contributions to their tax-deferred plans. Twelve years of catch-up contributions add another $90,000 to the savings pot. With a 4.5% annual return, that would grow to be worth $121,000 by 62. If you’re keeping score at home, this means a determined worker can build up a nest egg of nearly $3 million in their tax-deferred accounts by age 62. But wait, there’s more. Let’s presume retirees can live on other savings and Social Security until they begin taking required minimum…

Plan on Change

John Yeigh | Mar 13, 2023

IN MY ONGOING EFFORT to reduce our accumulated stuff, I was trolling through our collection of old thumb drives to see what I should download, save or toss. Among them, I discovered the 258-page presentation from a two-day retirement course that my old employer sponsored in 2006. I wondered how the advice had—17 years on—stood the test of time. As I reviewed it, I found some excellent suggestions and some that were lacking, though I hesitate to fault the presentation’s authors. I felt the course deserves an “A” for its detailed discussion of retirement lifestyle choices and investment planning. Company benefits were also exhaustively reviewed. We were told what benefits we were entitled to, and I recall employees and their spouses found those discussions comforting. In addition, most—but not all—Social Security issues were thoroughly reviewed. The tradeoff between claiming early at age 62 or waiting until an employee’s full Social Security retirement age, which would be 65 to 67, was covered. The potential for higher benefits by delaying claiming until age 70 wasn’t highlighted, however. The benefits of the “file and suspend” strategy for married couples also weren’t discussed—but, then again, this loophole was eliminated before I retired in 2017. I would give the presentation a “C” for its coverage of supplemental health and life insurance coverage. My employer later reduced those benefits, so these discussions are irrelevant now. Four areas deserve only a “D” grade. The course spent little, if any, time on the so-called stretch IRA, withdrawal rates, sequence-of-return risk, and strategies for taking income from a mix of taxable, tax-deferred and Roth accounts. [xyz-ihs snippet="Mobile-Subscribe"] What overall grade would I award the presentation? You might think it would average out to a “C” or maybe a generous “B.” But unfortunately, I’d give the course only a “D”—because, as…

No Free Ride

John Yeigh | Mar 1, 2019

WE ARE A NATION obsessed with youth sports. Time magazine says it's a $15 billion-a-year industry. As many as 60 million kids participate. Sports are good for kids for all kinds of reasons: promoting exercise and a healthy lifestyle, enhancing team work and relationships, providing structure, instilling confidence to overcome challenges and delivering the joy of playing. During our children’s sports journeys, we parents are often led to believe that our little sports stars are on the path to the holy grail—a full athletic college scholarship. The sports-industry complex of coaches, trainers, camp and tournament directors, and recruiting advisors often promote this fantasy. And we parents bite hard. After all, who doesn’t want their kid to receive a $200,000 free ride? But will they? Make no mistake: Youth sports aren’t free. College athletes typically require five to 10 years of dedicated travel sport participation, with the associated fees, equipment, travel and hotel costs, coaching fees, supplemental training, camps, showcase tournaments and tryouts, and perhaps a video or recruiting advisor. The commonly used and derided term “pay to play” highlights the financial underpinnings of youth sports. It's common for families to spend $2,000 to 5,000 a year for travel team participants, and $20,000 a year or more isn’t unheard of. I am intimately familiar with youth soccer and estimate the typical college soccer player incurred total costs of around $50,000 to get there. Even a barest-of-bones elite youth soccer journey would likely cost $25,000. On a strictly financial basis, 529 savings plans and Coverdell education savings accounts are far more reliable sources of college funding. In addition to high costs, youth players must grapple with all the other aspects of becoming an elite athlete—maintaining interest and discipline, remaining injury-free, continuous training and constant competition at the highest levels. Elite athletes then face…

What Remains: Money and Me

Would You Be Miserable?

How to Use AI With Your Portfolio

The Ping

Mourning the World

Moving is Expensive!

Reflections on a Quiet Failure

Peter Cancro from age 14 to 69 covered in oil and vinegar

Bucket Strategy

Time to share our financial info with children?

A $1,000 Conversation With My Daughter

The Quiet Failure of Good Advice

What Remains: Money and Me

Would You Be Miserable?

How to Use AI With Your Portfolio

The Ping

Mourning the World

Moving is Expensive!

Reflections on a Quiet Failure

Peter Cancro from age 14 to 69 covered in oil and vinegar

Bucket Strategy

Free Newsletter

Get Educated

Manifesto

act

Truths

think

Money Guide

Manifesto

Spotlight: Investing

Mega Backdoor Roth

Index Fund Bubble

Money and Me

Economic Trends

Wall Street Trap

Personal Finance Reading List

Spotlight: Yeigh

Penniless at Last

While We’re Waiting

Off the Payroll

A Path to $10 Million

Plan on Change

No Free Ride