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https://preservewm.com
We've been keeping up with the latest headlines...
here are two of our favorites worth sharing.
** Your Money
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Today, it costs about $80,000 to generate $1,000 of income from a 50/50 balanced portfolio...that's a little more than triple the long-term average cost. Worse still for conservative investors, the cost briefly exceeded $150,000 for bond investors in 2020!
Retirees don’t like spending down their savings (a 2015 study confirmed it). Unfortunately, it has never been more expensive to position a portfolio for income. Historically low interest rates coupled with declining dividend yields have created a significant dilemma for income investors.
Many investors are tempted to reach for yield by purchasing lower quality bonds or equities with higher dividend yields. Evidence from past returns shows that reaching for additional yield by investing in lower-quality bonds or higher dividend stocks entrails greater risk with little expectation of reward through higher returns.
At PWM, we believe viewing principal as untouchable and spending only income is a behavioral mistake. We focus on maximizing the after-tax total return from the portfolio and mapping out at least three years of cash flow within the family's risk tolerance.
What to Do About the High Cost of Investment Income (https://www.advisorperspectives.com/articles/2021/01/25/what-to-do-about-the-high-cost-of-investment-income)
by Michael Finke and David Blanchett
** Your Life
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Life is hard sometimes. Levity helps. Allow me…or rather Politico, to tickle your funny bone with cartoonists from around the world’s take on the global pandemic. Happy Monday!
Cartoonists around the world take on a global pandemic (https://www.politico.com/cartoons/2020/03/26/cartoonists-around-the-world-take-on-a-global-pandemic-000141?slide=0)
https://www.linkedin.com/in/danheth/
https://www.linkedin.com/in/rosalynn-harvey-heth-mpa-ceps-3a3aa3191/
** Complexity Simplified
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As we continue with winter and head towards spring, signs of hope are everywhere. None more evident than the possibility of getting rid of the continuing threat of COVID-19 through mass vaccinations. However, we still have a little more time at home. Spring brings spring cleaning. Look through closets for clothes never worn or not worn anymore. Whenever you can, donate. Not only are you helping others, but you are also recycling and, therefore, limiting your carbon footprint on the earth.
Donating is Recycling (http://donationtown.org/news/donating-is-recycling.html#:~:text=Fact%20%233%3A%20A%20major%20component,major%20harm%20to%20the%20environment)
by donation.org
** Trivia
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A: Maya Angelou
Q: What is the tallest breed of dog in the world?
https://www.youtube.com/watch?v=d-diB65scQU
** Back in 1988, this song reached #1
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