The most significant news this week was the announcement for myRA. People may be disappointed it’s nothing earth-shattering. I note it’s just the beginning. Maybe down the road it will open up to individuals without involving an employer, allow people to stay after the balance goes above $15k, and include the full TSP menu of investment options.
I also read these interesting articles this week:
Why Correlation Doesn’t Matter Much by Rick Ferri at RickFerri.com
I agree you shouldn’t read too much into a low correlation which may not persist.
How Often Do You Calculate Your Portfolio’s Rate of Return? by Mike Piper at Oblivious Investor
I invest in multiple funds and ETFs in multiple accounts. I don’t calculate my portfolio’s rate of return either.
“Groundhog Day” by Jim Rowley and Joel Dickson at Vanguard Blog for Advisors
I have both index funds and ETFs. They both have their places.
Floating Rate Note auctions with a premium of 0.045% by David Enna at TIPS Watch
The government issued a new type of Treasury note. It offers a floating rate tied to 3-month T-bills. Unfortunately you only get 0.045% plus 3-month T-bills rate, for a total of 0.085%. A savings account pays ten times more.
Net Unrealized Appreciation is not subject to the 3.8% surtax by Jim Blankenship at Getting Your Financial Ducks In A Row
You get favorable tax treatment if you buy your employer’s stock in your 401k. But you know shouldn’t buy your employer’s stock in your 401k (remember Enron). So leave the favorable tax treatment to those who got lucky.
Can We Really Measure Risk Tolerance Or Does It Swing Too Wildly With Market Volatility? by Michael Kitces at Nerd’s Eye View
I think the potential loss to income ratio is a good metric to keep risk in perspective.
What Drives Success? by Amy Chua and Jed Rubenfield at New York Times
Two Yale professors promoted their upcoming book in an op-ed piece in New York Times. I fall into one of the groups they mention (see about me). I don’t quite agree with their hypothesis. They are defining success too narrowly.
Following Your Dream Brings Bliss, but Not Always Money by Alina Tugend at New York Times
It has to be that way, right? If following your dream always brings money, who would work for large corporations?
Will Medicaid take my house when I die? at Consumer Reports
I would ask a different question: Would you prefer to sell your house to pay your medical bills before you die?
[Photo credit: Flickr user USFS Region 5]