I'M TRYING MY HAND at retirement. It isn’t going so well. As a teenager and when I was in my early 20s, I would take to the couch and happily spend the day consuming a novel. Could I do that at age 62? It seems not. At some point over the past four decades, I lost the ability to do things solely for my own enjoyment. It seems the endless demands of work, family and household chores have crushed my inner self-absorbed teenager. Am I missing out? I’m not sure. Sleeping in. This is relative. Before my diagnosis, I’d regularly get up at 5 a.m. Today, I’ll often stay in bed past 6. This is partly a conscious attempt to sleep more and partly because my body needs more sleep. My cancer, coupled with my treatment, can leave me feeling pretty fatigued. Still, after decades of getting seven hours of sleep a night and often less, it feels like a great luxury to linger longer in bed. This is one part of my “retirement” that I’ve successfully embraced. Travel. Since my diagnosis 11 months ago, Elaine and I have visited Ireland (twice), London and Paris, gone on a cruise, taken the kids and their families for a long weekend at a luxury resort, and made a number of shorter trips to places nearby. Many dollars have been spent. Has it been worth it? Some of the trips have been great. Others have been more of a struggle. Since late October, my mobility has been all over the map, a result of the cancer spreading to my spine. At its worst, I could barely walk a city block. After radiation treatment, I can almost feel like my old self, and have no problem walking. Even then, fatigue is an issue, and it’s especially bad when coupled with the changing time zones that accompany transatlantic trips. Before my diagnosis, Elaine and I had a wish list of places we wanted to visit, perhaps staying for weeks at a time. But those travel dreams have been largely nixed. It’s been tough for me to leave town for more than a week or so, given my endless medical appointments. All this is a reminder of what I’ve often read from HumbleDollar commenters, which is that retirees should travel while they can, because you never know when deteriorating health might steal that from you. Television. I’m ambivalent about TV, inclined to view it as a passive activity that usually isn’t worth the time invested. Still, in recent months, I’ve started to watch sports on TV every so often, something I stopped doing more than 25 years ago. Elaine and I also occasionally watch an episode of our latest TV series during the middle of the day, which feels like the height of decadence. I may even pay to stream July’s Tour de France, though I’m not sure I want to commit the necessary hours to take full advantage. Family. With my diagnosis, my family—my two kids, my mother, my three siblings—have rallied around me. We speak more often on the phone and see each other more frequently. If there’s an upside to my illness, this is it. Still, I’m not sure all of the above amounts to much of a retirement. Don’t I have any hobbies, you might wonder? I did—bicycling—and I imagined retirement would give me the chance to explore the Pennsylvania countryside on two wheels. But because I've had balance issues, the doctors ordered me to stop riding outside when I got my diagnosis, so the only cycling I do these days is in the basement. Any other hobbies? The problem, and I’m not sure it is one, is that my hobby is my work. I no longer spend my days editing articles for HumbleDollar. Those edited articles have been replaced by the pieces that the site’s readers post directly to the Forum. But while I’m no longer editing, I still devote part of each day to various writing projects and to monitoring activity on HumbleDollar. I enjoy it, and I think it’s a worthy use of my time. But I’m not sure others would consider what I do each day to be anything akin to retirement. Is there a lesson here? Perhaps. While HumbleDollar might be a community united by a desire to discuss financial issues in a civil and intelligent manner, the debates within the Forum highlight readers’ many differences. Among them: the virtues of budgeting, the wisdom of investing abroad, when to claim Social Security, whether to favor individual bonds over bond funds, how much to travel, the desirability of continuing care retirement communities, whether to buy income annuities, and much more. Similarly, there’s no one definition of retirement, and what makes others happy likely won’t work for you and me. Don’t like the way others are spending their retirement? That’s an easy one: Don’t do what they’re doing. Jonathan Clements is the founder and editor of HumbleDollar. Follow him on X @ClementsMoney and on Facebook, and check out his earlier posts. [xyz-ihs snippet="Donate"]

FRENCH HISTORIAN Alexis de Tocqueville toured the U.S. in the 1830s and chronicled his observations in a book titled Democracy in America. What mainly impressed him was Americans’ focus on trade and commerce. They have a “purely practical” mindset, he wrote, and concluded that “the position of the American is quite exceptional.” In the years since, others have picked up on this concept of “American exceptionalism.” Despite recent political and economic crosscurrents, the gap between the U.S. economy and its peers has only widened, especially over the past dozen years. Between 1990 and 2012, according to an analysis by author Larry Swedroe, corporate earnings in the U.S. grew no faster than in other countries. But since 2012, American companies’ profits have multiplied while—in aggregate—international companies’ earnings have stagnated. As a result, markets in the U.S. have far outpaced their international peers. This has made investing outside the U.S. feel like a losing proposition for quite some time. On the surface, this seems easy to explain. In the U.S., entrepreneurship is key to our DNA, and our regulatory regime makes it easy to get a business started. Hewlett and Packard got their start in Packard’s garage. Gates and Zuckerberg founded trillion-dollar companies in their dorm rooms. Jensen Huang launched Nvidia from a booth at Denny’s. By contrast, on the other side of the Atlantic, regulations make it harder to build a business. There aren’t any companies in Europe comparable to the “Magnificent Seven” technology firms in the U.S., and there are just a handful elsewhere in the world. In the European Union, working hours are strictly limited. In 2023, when the French government tried to raise the official retirement age from 62 to 64, more than a million people took to the streets to protest. Through this lens, the U.S. economy's outperformance seems to make sense. But this story may be oversimplified. Indeed, since the beginning of this year, markets in the U.S. have begun to falter. Domestic stocks are mostly in negative territory, while stocks outside the U.S. have delivered solid positive performance. This has people taking a second look at the question of American exceptionalism. Specifically, the question investors are asking is: To what degree should a portfolio be diversified internationally? This isn’t such an easy question. Ask the Vanguard Group to construct a portfolio, and it’ll be split roughly 60-40 between domestic and international stocks. Vanguard’s view is that there’s no reason to favor any one country or region of the world over another, and thus investors’ portfolios should simply reflect the relative weightings of world markets. But Vanguard's founder, the late Jack Bogle, took an entirely different view. He didn’t hesitate to tell people that his personal portfolio was 100% domestic. U.S. stocks, he felt, were entirely sufficient. There is, in short, no consensus on this question. Still, to gain clarity, we can consult the data. In a 2023 paper titled “Still Not Crazy After All These Years,” hedge fund manager Cliff Asness examined the outperformance of domestic stocks, performing what’s known as attribution analysis to uncover the sources of that performance. His conclusion: The lion’s share of domestic stocks’ impressive gains over the prior 15 years wasn’t due to earnings growth. It wasn’t, in other words, due to the exceptionalism of American companies. Instead, those companies’ stocks had, for the most part, just become more expensive. Even though U.S. stocks have given up some of their lead this year, that valuation gap is still very significant. Using the price-to-earnings (P/E) ratio as a measure, domestic stocks today are still 40% more expensive than their peers in developed markets outside the U.S. Boosters of a domestic-only approach are quick to reply that American stocks deserve higher valuations. There is no "Magnificent Seven” anywhere outside the U.S., they argue, and these companies’ scale and impressive growth warrant higher valuations. But that argument quickly falls apart. As Asness points out, domestic and international stocks traded at comparable valuations as recently as 2007. The valuation gap is a new phenomenon. According to the Swedroe analysis referenced above, another factor has contributed to domestic stocks’ outperformance: Between 2008 and 2024, the U.S. dollar appreciated nearly 20% against international currencies. This depressed the value of international stocks for U.S. investors, thus further boosting the relative performance of domestic stocks. There is, however, no guarantee that this trend will continue—and, indeed, it could reverse. To be sure, there are unique aspects to the U.S. economy, and de Tocqueville’s observations have validity. But a quantitative analysis suggests that the extreme U.S. outperformance we’ve seen over the past dozen years may not continue indefinitely. Despite some erosion this year, domestic stocks still carry elevated valuations compared to international markets, and the U.S. dollar is still expensive. This is worth paying attention to, because ultimately valuations do matter. Investments that are expensive usually don’t offer the same prospective returns. That’s certainly what history suggests. While it may be hard to remember, there have been multi-year periods when international stocks have outperformed the U.S. market. In fact, a chart of domestic vs. international stocks looks a little like a sine wave, with performance alternating over time. For that reason, I continue to recommend an allocation to international stocks. How much? I suggest something in the neighborhood of 20%. According to the data, that’s enough to deliver a diversification benefit, but not so much that it introduces significant currency risk. A final note: You might notice that I haven’t mentioned the proximate cause of the valuation shifts we’ve seen this year—the new administration’s tariff policies. I’m not focusing on this specifically because I see it as just one example of how markets can shift unexpectedly. In choosing an international allocation—or any other aspect of your portfolio—I recommend taking the long view. My advice: Choose a structure that you think will make sense regardless of who is in the White House or where the economy happens to stand at any given time. 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. [xyz-ihs snippet="Donate"]