This is “ReSolve’s Riffs” – live on YouTube every Friday afternoon to debate the most relevant investment topics of the day.
As life expectancy increased throughout much of the past century, so did the importance of saving and growing one’s nest egg for retirement. Though most who retired during the last 40 years enjoyed a massive tailwind from stocks and bonds, those that switched from accumulating to drawing down their savings between 2000 and 2002 suffered a rude awakening. Currently, there is widespread concern that typical stocks-and-bonds heuristics will not suffice.
Ben Carlson (Director of Institutional Asset Management at Ritholtz Wealth Management) has given this a lot of thought. He joined the ReSolve crew to talk about his recently launched book, covering topics that included:
- Investment principles as a distant and foreign language outside of finance: the importance of narrative to bridge the comprehension gap (which can often be a chasm)
- The dual role of financial advisors: fiduciaries and behavioral psychologists
- Incentives to create and nurture a savings habit: mindset is key
- The myths surrounding risk tolerance: willingness vs ability
- Savings rate, lifestyle and portfolio returns: understanding the levers we can actually control
- A crucial yet often overlooked factor: sequence of returns
- CPI inflation vs the inflation that individuals experience: the blind spot for most portfolios
We also discussed how remaining active into an older age is correlated not only with a longer lifespan, but also with prolonged health and mental acuity.
Thank you for watching and listening. See you next week.