A three-fund portfolio is a simple way to diversify across the world’s stock and bond markets, and guarantee yourself your fair share of the full world’s market growth. It’s optimal investing with optimal simplicity. What is a three-fund portfolio? A three fund portfolio is an allocation of just three funds that make up an entire […]
I think getting these different “layers” confused is the absolute number one most common confusion in investing. So let’s walk through what happens when you invest.1. You go to a brokerage website (e.g. Vanguard.com)2. You open an account (e.g. a Roth IRA)… now your Roth IRA is with/inside of Vanguard.3. You contribute money to your […]
I often discuss how owning your primary home isn’t a great investment. In fact, after you account for property taxes, mortgage interest, maintenance, insurance, and realtor fees, almost every homeowner loses money net of their expenses. While most homeowners do sell the property for more than they bought it for, that just gives the illusion […]
I get this question a lot. ETFs and index funds are nearly identical. The equivalent ETF and index fund (as the example above) contains the exact same stocks and performs exactly the same. The only difference is in how you buy and sell them. ETFs trade like stocks. You can buy and sell in realtime […]
Many of you know I talk about investing and the power of index funds all the time, but today’s post is about when NOT to invest. The power of investing comes from time. When you have a 10+ year horizon the impact of buying and holding index funds can be massive. But over a shorter […]
For the record, this isn’t a paid post (in fact, I have never done a paid post). I’m also not necessarily endorsing Fidelity, although it is the brokerage I primarily use for about 95% of my liquid assets. That said, it’s pretty cool Fidelity identified the race to the bottom on minimizing fees on index […]
Learn the concept of an index fund and how it differs from an actively managed mutual fund.
All four of these types of accounts exist: Roth IRA Traditional IRA Roth 401(k) Traditional 401(k) I think the terms can confuse people so let’s break it down.An IRA is an Individual Retirement Account. It comes in two “flavors”: Traditional and Roth. Both IRAs have a contribution limit of $6,000 in 2020. The difference is […]
In order to build wealth, it’s important to have a plan and focus. These phases of investing help prioritize how you put your money to work in order to maximize your future wealth. Do these in order. Don’t move onto the next until the current phase is completed. (But once you progress past a phase, […]
Just about every day of my life I talk to someone who misunderstands the impact of the share price of a share of stock, ETF or index fund. Knowing the share price alone gives you zero information about that investment. It absolutely cannot be used to compare to another investment or to gain information about […]
