Some of you are probably familiar with the famous Marshmallow Test. In the 1960s psychologist Walter Mischel designed a simple experiment to test the self-control of preschoolers. Mischel would let the students pick from a variety of treats. He would then tell them they could eat the treat immediately, or they could wait until he…
How We Think Investment Costs Work When I first started investing twenty years ago I had no clue what I was doing. I had, however, read enough to know that it was important to keep investment costs low. I remember looking at a list of mutual funds I was considering investing in. One of the…
An Investor with minimal curiosity will learn that the shortest and surest route to top-quartile performance is bottom-quartile expenses. – John C. Bogle, Vanguard founder and index fund pioneer The efficient market hypothesis (EMH) states that capital markets are highly efficient, and that any new information about a company’s stock is almost immediately reflected in…
Make the best of what is in your power, and take the rest as it happens. – Greek philosopher Epictetus (AD 55 to 135) Concern or Control? One of my favorite speakers and authors is Stephen R. Covey (1932 to 2012). In his wonderful book The Seven Habits of Highly Effective People Covey teaches that…
Men do not desire to be rich, only to be richer than other men. – John Stuart Mills (1806-1873) There is a great old Jewish folktale in Rabbi Harold Kushner’s book When Bad Things Happen to Good People. The story is about two competing shopkeepers in a small town. Their shops were right across the street…
Gazelle Intensity Popular debt elimination evangelist Dave Ramsey teaches that, after setting aside $1,000 for emergencies, your only financial priority should be paying off all debt except your home mortgage. Everything else, including saving for retirement, should be put on hold until your debts are paid. Ramsey uses the term “gazelle intensity” to describe the…
