FINANCIaL
FIELd NOTES
Why Chasing Winners Rarely Works
Having a diversified portfolio can be an agonizing experience. On one hand, you will always have some exposure to the best-performing investments, but it will never be as much as you want it to be.
For the past decade, it has been difficult to own small-cap stocks, international stocks, and value stocks. US growth stocks and REITS have been some of the best investments. But even these investments have had some terrible years…
How We Can Interpret Data Better
My favorite read last year was Factfulness by Hans Rosling. It provides insight into how to approach data - particularly data related to hot button issues. A lot of the book can be boiled down to “ask the next question.“
For example, the other day I saw this headline - “Pasta may be good for your heart health.” I love pasta as much as the next person but I was skeptical…
Being Greedy When Others Are Fearful Is Hard
You have likely heard the saying “Be greedy when others are fearful, and fearful when others are greedy.” It sounds simple in theory – be a buyer when stocks are cheap and a seller when they are expensive.
But why is that so hard?
How to Pay 0% Capital Gains Tax
When you sell an investment for a gain outside of a retirement account, you typically pay “capital gains tax.” For example, if you bought an index fund for $10,000 and sold it for $15,000, you would have to report the $5,000 gain as income on your tax return.
There are only 3 main federal tax brackets for capital gains. You are either taxed at 20%, 15%, or even 0%…
7 Strategies For Lowering Investment Taxes
A friend of mine was recently complaining to me about a tax bill coming their way from the sale of investments. I joked that I would gladly pay his tax bill if he gave me his investment gains…he declined.
Taxes are an inevitable part of investing but generally, it is a good problem to have since it means you made money. However, there are several strategies to consider to make sure you don’t pay more than your fair share to Uncle Sam.
Roth Conversions When The Market Is Down
When I evaluate Roth conversion plans, I typically wait until the end of the year to complete the conversions so I can ensure that income actually ended up being what was projected.
However, if there is volatility in the stock market, it can be a great benefit to convert while the market is down…