Author: John Hall

QUIT COSTING YOURSELF MONEY: RECOGNIZING OUR INVESTMENT BIASES

HOME BIAS People all over the country fill out basketball brackets every March for the NCAA tournament, often putting money behind their guesses. It likely wouldn’t surprise you that the predicted winners vary by geography; that is, people on the East Coast tend to favor East Coast teams whereas people on the West Coast tend to favor West Coast teams. It’s easy to see how that’s the case. People “bet” on what they are most familiar with… even if that familiarity has no bearing on who the eventual winner is likely to be. Ruining your bracket is one thing....

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Taking Control of Our Financial Fears

If you’ve ever taken an economics course you may have learned that people are rational. However, if you’ve ever met another person or simply looked in the mirror, you may have learned that’s simply not always the case. Sometimes our emotions, not our intellect, drive our decision-making process. When it comes to our financial decisions, it can pay to be aware of these emotional tendencies. Chief among them—fear. Let’s look at three different types of fear that can affect our financial well-being: Fear of Missing Out (aka FOMO) You remember the dot-com bubble, don’t you? Everyone you knew was...

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Money State of Mind

Four Key Concepts to Understand if You Want to Grow Your Wealth When I’m asked how to accumulate wealth, most people expect a mathematically-themed answer. The math of personal finance is important, but in my opinion it is very much secondary to what’s really important—having a money state of mind. Having a money state of mind means understanding and putting into practice certain concepts that help shape all of our financial decisions. It’s a firm grasp of these concepts, not the intricacies of financial math, that allow us to accumulate, grow, and maintain wealth. My favorite of these are...

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You Think This Can’t Happen to You?

A cautionary tale for anyone involved in a real estate transaction Imagine, if you will, that you’re about to purchase a new home. You and your family are full of anticipation… maybe it’s your dream home, or maybe you’re downsizing into the perfect place that will allow you to travel more and worry less. Whatever the case may be, it’s an exciting time and you’ve been eagerly awaiting the closing date. All the contingencies are satisfied—anything that could potentially derail the deal is behind you. Smooth sailing to the closing. Let’s also assume that you, the buyer, are making...

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The Roth IRA

and its Many Uses Many investors are familiar with Roth IRAs. They’re a great way to save after-tax money for future use. The main benefits are this: your money grows tax free and can be taken out tax free after age 59 1/2. (An added bonus is that contributions can often be taken out tax- and penalty-free before then). The main drawdowns are the annual contribution limits (currently $5,500 or $6,500 if you’re 50 or older) and that if you make too much money (a great problem to have) then you’re not eligible to contribute to a Roth IRA....

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