As we announced in our last post, today we launch the first in Sheri’s Summer Refresher Series. Let’s begin at the beginning, by revisiting one of our earliest posts. The piece remains as relevant today as it did in February 2013, which illustrates why we were such an enthusiastic early adopter of evidence-based investing, and why we remain so to this day.
In contrast to so many so-called “strategies,” that require you to be forever adjusting your position in the face of every new market twist and turn, our goal is to help investors manage their money from a more stable platform, grounded in the timeless principles that robust, academic evidence helps us identify.
That’s smart money management – then and now.
Money Management: Traditions, Fads and Fashions
Originally posted: February 21, 2013
An intriguing recent blog post, “Why We Fear Simple Money Solutions,” from Behavior Gap author Carl Richards got me to thinking. In his post, he cites three reasons he feels people way over-complicate their money management. His third point was especially familiar: “We like tradition,” says Richards, “So any time we see something that’s too different from what we’re familiar with, we treat it with suspicion.”
True enough. It’s why we love our comfort foods, our holiday gatherings, bowling leagues. As motivational speaker Jim Rohn has observed: “We generally change ourselves for one of two reasons: inspiration or desperation.” And my guess is that it’s desperation more often than not! That said, especially in the realm of finance, there is often good reason to look before you leap. Each change should be:
Balanced – Embracing each and every change on Wall Street would likely add to your life’s complexity rather than simplify it.
Well-Tailored – In a trash/treasure sort of way, your neighbor’s excellent new solution may be a disastrous idea for you and your circumstances. The saving, investing and spending needs of a single, 25-year-old entrepreneur is going to look very different from those of you who are deep into planning for your retirement while sending your kids through college and assisting aging parents.
A Good Idea – Not every “new & improved” really is. Just ask Coca-Cola® about that.
That’s where I come in as an advisor. It’s my job to help our clients separate durable form from expensive flash. I like how Vanguard chairman emeritus described it in a recent interview, in which he was discussing the oxymoron of actively managed Exchange Traded Funds (which is another blog post entirely). He said: “Products keep coming out, and it’s worrisome. The big challenge for advisers is figuring out what’s innovation and what’s proliferation.”
So make new friends … and traditions. Keep some of the old. Whenever you’re not sure which is what in your money management, give me a call.
 InvestmentNews, “Three Things That Worry Jack Brennan,” February 17, 2013.
SAGE Serendipity: On Aug. 5, 2011 NASA’s Juno launched on a journey to Jupiter atop a United Launch Alliance Atlas 5 rocket. Almost five years later, on July 4, 2016, after traveling more than 1.7 billion miles, Juno successfully entered the planet’s orbit during a 35-minute engine burn.
Spaceflightnow.com and nasa.gov are great places for ongoing news of the mission as is the Juno Facebook page. “What we learn from the Juno mission will provide new insights to help us understand the formation of our own family of planets and the origins of the many planetary systems now being discovered around other stars.”