Thursday, February 23, 2017

Is your retirement in jeopardy?

Due to severe budget problems, Puerto Rico will have to slash its budget, as announced in February 2017 (see This includes cutting 10% from the retirement system for government employees, since that system is on the verge of running out of money completely. Sound familiar, U.S. residents?...

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Saturday, February 11, 2017

Should you trust the stock market? Pt I

Should you trust the stock market? Part I

Historically, the returns have been good on the Dow Jones or the S&P 500. But, as every financial advisor cautions, past performance is no guarantee of future results.

Dow Jones (all-time):
A historical graph. From its record low of under 35 in the late 1890s to a high reached above 14,000 in mid-2011, the Dow rises periodically through the decades with corrections along the way eventually settling in the mid-10,000 range within the last 10 years.

Dow Jones (all-time, labeled with some historical highlights):

S&P 500 (since 1950, including adjustment for inflation):

Or, for those who would prefer an annualized chart of S&P 500 returns, here you go (all-time--note that the S&P 500 was called the "Composite Index" before 1957):

Notably, John Bogle is not optimistic:

So, should you be optimistic? Is it wise to invest in the stock market? Is the market really trustworthy?

You don't need my advice. Take a look at the graphs above and decide for yourself.

Friday, February 3, 2017

How advertising ruins your life

According to this article, companies spent nearly $600 billion—that's billion with a b—on advertising around the world in 2015 alone!

All of this money is geared toward one thing: convincing you to spend, spend, spend! Is it really any wonder that consumer debt is sky-high, and 70% of Americans believe that debt is necessary? I'm here to tell you that it's not necessary. Not at all.

The point of advertising is to make you want stuff. And if you spend your money on stuff, it can't be invested and go to work for you. In fact, many businesses use some pretty clever psychological tricks to get people to spend money on an annual, biannual, or monthly basis. So apologies for the clickbait-y title, but in a general sense, it's true: the constant stream of advertising ruins people's lives!

What happens if you don't buy into the advertising hype? Well, take me for example: I live on under $13,000 a year, before taxes. And I make money doing it! Not much money, mind you, but I live well below my meager means!