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I’m going to start with a brief update on major events in my personal life and lessons I’ve learned that can help you.
Then, I address a few major challenges we all do, or will, face as investors:
- How do you invest through varying market valuation and interest rate environments?
- How do you build a portfolio that is tax efficient and simple to manage?
- Where can you find the sweet spot between generating the most retirement income with the least amount of risk of depleting your portfolio?
I close out with an article about changing attitudes and actions around spending money to reflect your changing reality as wealth grows. I also share an outstanding offer on one of my favorite travel credit cards and how I’m changing my personal credit card strategy.
Losing a Loved One
I’ve been sporadic with writing and responding to blog comments over the past few months. My primary focus had been on helping to care for my mom who was in hospice care.
She passed away peacefully a few weeks ago. As my dad, brother, and I have worked through dealing with all of the financial tasks that are necessary while also dealing with the grief of losing a loved one, I have been grateful for the work we’ve done in preparation for that day.
All the preparation in the world doesn’t make end of life issues and the loss of a loved one easy, but it does make it more manageable. For that reason, I want to highlight a few resources that I’m grateful to have found and used that may benefit you.
Having Hard Conversations
A few years ago, I reviewed Cameron Huddleston’s book Mom and Dad, We Need to Talk. Most estate planning books and articles focus on the technical details of wills, living wills, proper legal titling of assets, etc.
Huddleston’s book focuses on a major challenge in many households that precedes technical planning, starting conversations about death and becoming incapacitated with loved ones who may be reluctant to have them. She also provides a framework for creating better conversations once everyone is receptive.
Having had these conversations in advance, rather than trying to figure things out in the stress of the moment was a tremendous blessing for our family. If this is something you know you need to do but never seem to get started, I highly recommend picking up a copy of Huddleston’s excellent book and sharing it with those you love.
Dealing With the Aftermath
A few weeks ago, I published a review of Mike Piper’s book After the Death of Your Spouse. By coincidence, my mom passed away a few hours before that post was scheduled to go live on the website. I initially gave the book a strong recommendation, thinking it seemed like a great resource for where we were at that moment.
In the weeks since then, my dad, brother and I have worked through many necessary tasks including planning and paying for the funeral, finding and collecting a couple old life insurance policies, and updating all of his financial and utility accounts and legal documents.
After using Piper’s book to provide a checklist of what needed to be done and a source of guidance on issues we weren’t sure about, we’ve completed all of the key urgent tasks in just a few weeks. I recommend picking up your own copy of this book as a resource even more strongly now than I initially did for when the day comes that you will need it.
Building (or Rebuilding) a Portfolio
Being a successful investor requires finding a delicate balance between knowing market history but not getting overconfident that your knowledge of the past will allow you to predict the future. The next two pieces are courtesy of Adam Grossman and are reflective of conversations I’ve been having with my financial planning clients.
The first, Beyond Valuations, explains that valuations are an indicator of how cheap or expensive your stocks are. However, Grossman points out that there are multiple ways to measure valuation, valuations don’t happen in a vacuum, and they aren’t great predictors of the future for long periods at a time. So we should be humble about extrapolating more from these measures than is actually there.
The second, Not Crazy, reminds us why we diversify, why we need to be aware of recency bias, and how long market trends can persist.
Simplicity > Complexity
Mike Piper writes Asset Location Fundamentals (Which Investments to Own in Which Account). This article addresses the question, “out of my desired asset allocation, which parts are the least-bad to own in taxable?” and provides elegant solutions to this complex question.
Amy Arnott explains Why Investment Complexity Is Not Your Friend.
Being Flexible in Retirement
Christine Benz shares the pros and cons of different flexible retirement withdrawal strategies, writing When It Comes to Retirement Spending, Flexibility Pays.
Learning to Spend
Mr. Money Mustache shares how he is overcoming a scarcity mentality and learning to spend on himself, writing as only he can Frugal Man Buys $52,000 Car – Why??
Great Offer On a Great Card
My favorite credit card to recommend to those new to travel credit card rewards is the card_name due to its flexibility and ease of use when redeeming rewards. This card is provides 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening.
That is a value of $750 when you redeem through Chase Ultimate Rewards® and potentially more if you transfer the points to transfer partners like Southwest Airlines or Hyatt Hotels. The card has a $95 annual fee.
This month, I helped my dad sign up for my other favorite card for those new to travel rewards, the card_name. This card offers a one-time bonus of 75,000 miles, valued at $750 towards travel expenses, once you spend $4,000 on purchases within 3 months from account opening. This card also provides up to a $100 credit for Global Entry or TSA PreCheck®.
I chose this card for him because these miles are also incredibly easy to use and flexible. Simply pay for travel expenses on the card and then apply the miles to erase the expense from your statement. This card also has a $95 annual fee.
My First Premium Credit Card
My personal credit card strategy has traditionally focused on cards like those highlighted above, offering generous sign up bonuses, simplicity to redeem the rewards, and relatively low annual fees.
I recently signed up for my first premium card, the card_name with a hefty $395 annual fee. This card also offers 75,000 Capital One bonus miles after you spend $4,000 on the card within 3 months from account opening. So why the switch?
First off, in addition to the sign up bonus and $100 credit for Global Entry or TSA PreCheck® the card also offers $300 in additional travel credits for travel booked through Capital One Travel on their app or website. This negates the higher annual fee, in exchange for a little additional complexity.
The draw of this card was the free access it provides to airport lounges. My family has been traveling a lot over the past year and we anticipate continuing to do so in the coming year. In a post-COVID world that means a lot of indirect flights and altered schedules leading to a lot of time sitting in airports on layover and delays.
On our first flight as a family, we were delayed almost three hours in Pittsburgh. Rather than being irritable, uncomfortable, and out around $100 for overpriced airport food and drinks for the three of us, we spent our time comfortably in The Club lounge playing games at a table while enjoying unlimited free drinks from the open bar and as much free food as we desired.
If you spend a lot of time traveling by plane, this is definitely a card worth considering for these perks.
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[Chris Mamula used principles of traditional retirement planning, combined with creative lifestyle design, to retire from a career as a physical therapist at age 41. After poor experiences with the financial industry early in his professional life, he educated himself on investing and tax planning. After achieving financial independence, Chris began writing about wealth building, DIY investing, financial planning, early retirement, and lifestyle design at Can I Retire Yet? He is also the primary author of the book Choose FI: Your Blueprint to Financial Independence. Chris also does financial planning with individuals and couples at Abundo Wealth, a low-cost, advice-only financial planning firm with the mission of making quality financial advice available to populations for whom it was previously inaccessible. Chris has been featured on MarketWatch, Morningstar, U.S. News & World Report, and Business Insider. He has spoken at events including the Bogleheads and the American Institute of Certified Public Accountants annual conferences. Blog inquiries can be sent to firstname.lastname@example.org. Financial planning inquiries can be sent to email@example.com][Chris Mamula used principles of traditional retirement planning, combined with creative lifestyle design, to retire from a career as a physical therapist at age 41. After poor experiences with the financial industry early in his professional life, he educated himself on investing and tax planning. After achieving financial independence, Chris began writing about wealth building, DIY investing, financial planning, early retirement, and lifestyle design at Can I Retire Yet? He is also the primary author of the book Choose FI: Your Blueprint to Financial Independence. Chris also does financial planning with individuals and couples at Abundo Wealth, a low-cost, advice-only financial planning firm with the mission of making quality financial advice available to populations for whom it was previously inaccessible. Chris has been featured on MarketWatch, Morningstar, U.S. News & World Report, and Business Insider. He has spoken at events including the Bogleheads and the American Institute of Certified Public Accountants annual conferences. Blog inquiries can be sent to firstname.lastname@example.org. Financial planning inquiries can be sent to email@example.com]
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