Buying Expensive Clothes Can Be Frugal

I thought it was time for a more light-hearted article.  We’ve been covering a lot of investing topics lately so I felt like a change of pace.

This article highlights the difference between frugal and cheap with regards to clothes purchases.  Many people mistakenly think frugal and cheap are the same thing but they are not.  Cheap is looking for the lowest cost with little consideration for anything else.  Frugal is concerned with getting the best value.  In fact, many people, including myself broaden this even more and think of being frugal as trying to get the maximum happiness for our spending.

This difference between cheap and frugal leads to some interesting contrasts.   Continue reading “Buying Expensive Clothes Can Be Frugal”

Harvesting Capital Gains instead of Tax Losses – Advantages of using Stocks for Income in Early Retirement

Business ownership is one of the best proven ways to gain wealth.  To get super-rich, you need to actually own or start a business and be successful in profitably growing that business.  Personally that seems risky to me and way too much work.
So I do the next best thing; I Continue reading “Harvesting Capital Gains instead of Tax Losses – Advantages of using Stocks for Income in Early Retirement”

Increase your Long-Term Stock Investing Success by Understanding True Risk

Investing.  Stocks.  Risk.  Fear.  Return.  Volatility.  All of these terms go together.  The so-called Risk vs Reward spectrum means that investors should rationally demand higher returns for riskier investments as compensation for bearing that risk.  So ultra-safe US treasuries or cash accounts will have the lowest returns.  Riskier investments like stocks, real estate, longer-term bonds, or various alternative investments should have higher returns (but also an increased chance of losing significant value).  But the term risk is thrown about pretty loosely and is viewed differently by many people.  So this article will delve into risk.  Particularly risk in investing.  I’ll use the stock market as an example since it is my primary vehicle for maintaining and growing my own long-term wealth and security.  I believe it’s critical to understand this well for your long-term financial success, particularly in early retirement where you are likely to be dependent on investments to sustain your spending for 40-50+ years.  As you understand this better, you’ll make better investing and allocation decisions and also be less likely to make poor short-term financial decisions.  The vast majority of FIRE success stories involve people who understand this well.  It’s worth learning.

Continue reading “Increase your Long-Term Stock Investing Success by Understanding True Risk”