The Cost of Being Green
I love the Om Money column in the Yoga Journal magazine. It's the first thing I read in every issue. The column features a question from a reader answered by two money experts. A previous column prompted me to write Unsure About Socially Responsible Investing (SRI) last year. Here's another good question in the September 2008 issue:
I strive to be "green," but organic food is expensive. I have to work more hours (and do less yoga) to afford it. How can I balance personal and planetary welfare?
Buy Now Or Buy Gradually Over Time?
A reader asked a question in the comments to my previous post Bought REITs Again. I'm answering it in a new post because the question is quite common.
"If you were to set up a new IRA and pour some cash into it (200K), would you go ahead and dive right in or wait and time? For example, VTI is way down now, so is EEM and other ETFs. Would you consider gradually moving in (say 10% each month?)"
Unsure About Socially Responsible Investing (SRI)
I read this question in a recent issue of the Yoga Journal magazine:
"I don't want to support tobacco companies or environmental polluters, but my broker claims that socially responsible investing will cost me. How can I persuade my broker to make investments that align with my values?"
Personal Finance Quiz, September 2007
Here are some of the questions from visitors to this blog who looked for the answers using a search engine. Without searching, which ones can you answer? Regular readers should be able to answer most of them. Oh, may be not the last one. Let's see who can answer them all.
Q. Are FHLB bonds taxable?
Q. Is Fidelity TIPS fund good?
Risks in Money Market Funds
Reader Kim asked, referring to my post Which Vanguard Money Market Fund? in April,
"In light of the current sub-prime meltdown, some people are questioning whether they should move out of Vanguard Prime MMF into something safer, like Vanguard Treasury MMF. Your blog helps calculate return under different scenarios but leaves off the risk aspect. Would it be of interest to you to add in some additional calcs. to quantify the risk v. return aspect to give a better picture on each fund? I am very interested in this issue because it is often neglected. Thanks!"
Avoiding the Worst Days and Missing the Best Days
Two readers commented about avoiding the worst days on my post about the meaningless stats on missing the best days. The stock market had some bad days since then. I think some might be interested in reading about avoiding the worst days.
First I want to emphasize that the whole point of my previous post was that it's IMPOSSIBLE to miss the best 10 days in 10 years. The odds are 1 in 2.8 billion billion billion, which is like winning the Powerball jackpot with a single ticket purchase back to back to back. By the same calculation it's equally IMPOSSIBLE to avoid the worst 10 days. But since they asked, I compiled some numbers for avoiding the worst 10 days in 10 years. So here you go, more meaningless stats.
The rewards for avoiding the worst days are equally as impressive as the penalty for missing the best days. Look at this chart:
Personal Rate of Return: Dollar Weighted Or Time Weighted
After reading my post about estimating overall personal rate of return, a reader Brian asked:
"I have a Fidelity serviced 401(k) and I had always wondered about how they calculated the personal rate of return. Do you know how/if other providers calculate personal rates of return? If I were to open a brokerage account, is there one company that does this better than others?"
Rates of return fall into two major categories: Dollar Weighted Rate of Return and Time Weighted Rate of Return. They measure different things and they should be used for different purposes.
ESPP: What's In It for the Company?
After reading my post about ESPP, a reader David sent me an e-mail and asked
I've read a bunch of stuff about ESPP and while everyone talks about what a good deal it is for the employees who are able to participate, or the tax consequences of the various ways to sell the shares, no one talks about what is in it for the company offering the plan. Any ideas?
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