Are you living the life you chose?

Financial Wisdom From Jason Isbell

Originally in ForbesI love finding financial wisdom in unlikely places, like in art and music. These opportunities are more abundant than you might expect. For instance, the punk-Americana outfit, The Avett Brothers, dedicated an entire tune, aptly titled “Ill With Want,” to the scourge of greed and Mumford & Sons taught us that “where you invest your love, you invest your life.”

The newest melodic metaphor to catch my ear comes from singer-songwriter Jason Isbell. He expresses his appreciation for having work in the title track of his newest album, “Something More Than Free,” but it’s the pair of questions he poses in another song, “The Life You Chose,” that really got me thinking.

“Are you living the life you chose? Are you living the life that chose you?” asks Isbell.

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I fear it is the latter for many, if not most, of us. Perhaps we are stuck living a life that has grown into a web of circumstances driven more by external compulsions than autonomous impulsions. For too many, life is lived at the behest of someone else’s priorities and goals, in pursuit of someone else’s calling.

Simple Money Is Here

A No-Nonsense Guide to Personal Finance

Unfortunately, personal finance has been reduced to a short list of “Dos” and a long (long) list of “Don’ts” typically based on someone else’s priorities in life, not yours.

But personal finance is actually more personal than it is finance.

Learn More and Get Your Copy of Simple Money

That’s why what works great for someone else may not work as well for you. Money management is complex because we are complex. Therefore, it is in better understanding ourselves—our history with money and what we value most—that we are able to bring clarity to even the most confounding decisions in money and life. As an advisor, speaker and author, I’ve made a career out of demystifying complex financial concepts into understandable, doable actions. In this practical book, I’ll show you how to

  • find contentment by redefining “wealth”
  • establish your priorities, articulate your goals, and find your calling
  • design a personal budgeting system you can (almost) enjoy
  • create a simple, world-class investment portfolio that has beaten the pros
  • manage risk—with and without insurance
  • ditch the traditional concept of retirement and plan for financial independence
  • cheat death and build a legacy
  • and more

Learn More About The Author

The problem with so much personal finance advice is that it’s unnecessarily complicated, often with the goal of selling you things you don’t need. Tim Maurer never plays that game. His straightforward, candid and yes — simple — prescriptions are always right on target. Jean Chatzky
financial editor of NBC's 'Today Show'

Here’s what others are saying about Simple Money:

“Reading this book is like having your own personal financial advisor.”—Kimberly Palmer, senior money editor at US News & World Report; author of The Economy of You

“You can’t manage your money without thinking about your life—and the system that Tim proposes can make a radical difference in both.”—Chris Guillebeau, New York Times bestselling author of The $100 Startup and The Happiness of Pursuit

“Maurer teaches us how to literally redefine wealth in a way that will both honor your life values and priorities while simultaneously reducing your stress.”—Manisha Thakor, CFA, director of wealth strategies for women for the BAM Alliance; writer for The Wall Street Journal

“Amen! Amen! Amen! Simplicity is a gift . . . and this book offers it by the truckload!”—Carl Richards, New York Times columnist;  author of The One-Page Financial Plan

Read more praise for ‘Simple Money’

How To Know When To Get Out Of The Market

Originally published CNBCHas the market’s recent volatility worried you? Me too. It’s inevitable. Apparently, it’s how we’re wired. But better understanding that wiring can give us a clear decision-making framework to help us know if and when to get out of the market.

The field of behavioral finance has demonstrated that the pain we derive from market losses impacts us twice as much as the pleasure we feel from market gains. For this reason, investors are well served to name and address these emotions instead of setting them aside as they (unfortunately) have been taught.

We’ve all heard of the cost/benefit decision-making model, but “cost” and “benefit” are intellectual constructs too distant from the actual emotions that drive our decision-making. We need to address the gut—the “pain” and the “pleasure” associated with a tough decision. The following four-step model seeks to merge the head and the gut. And while it’s applicable in virtually any either/or scenario, let’s specifically address the decision to stay invested in the market or to move to cash:

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1) The pain of staying invested is that I could lose even more.

SPEAKING: On Personal Finance

I'd love to speak at your next event!

Personal finance is more personal than it is finance. This is a message, grounded in science, that I’m privileged to share in various forms speaking for various audiences. Whether for an association of financial planners, a Fortune 500 company, an academic institution or a non-profit, my strategy is to ENGAGE, ENTERTAIN and EDUCATE your audience, giving attendees tangible takeaways to improve their lives and work.

Why The Stock Market Is Volatile, Why Volatility Hurts, And What To Do About It

Originally in ForbesUnless you made a resolution not to read, listen to or watch the news in 2016, you’ve likely noticed that “the market” is off to a stumbling start. Indeed, one glance at the headlines, at least the ones that don’t involve the presidential election, quickly reveals that the market is having one of its worst starts to any new year. This is a dubious distinction, to be sure.

The factors involved appear similar to those credited for causing the extreme volatility we saw in the fall of 2015—slower growth in China, falling oil prices, geopolitical instability and the threat of bankruptcies in junk bonds. But the optimist’s case seems equally compelling—high-quality bonds (the only kind I recommend) are performing very well, falling oil prices are good for consumers, the Fed’s interest rate rise signals a strengthening U.S. economy and the most recent jobs report was positive.

An objective view of the market reminds us that on every trading day in history, there have been compelling cases to be made for both optimism and pessimism—for purchases or sales. (Remember that every single security transaction involves a buyer and a seller, each of whom believes he or she is getting the better end of the deal.)

Ultimately, there is only one sufficient answer to the question, “Why is the market so volatile?” The market exhibits volatility because that is its nature.

10 Things You Absolutely Need To Know About Life Insurance

Originally in ForbesLife insurance is one of the pillars of personal finance, deserving of consideration by every household. I’d even go so far as to say it’s vital for most. Yet, despite its nearly universal applicability, there remains a great deal of confusion, and even skepticism, regarding life insurance.

Life insurance

Perhaps this is due to life insurance’s complexity, the posture of those who sell it or merely our preference for avoiding the topic of our own demise. But armed with the proper information, you can simplify the decision-making process and arrive at the right choice for you and your family.

To help, here are 10 things you absolutely need to know about life insurance:

  1. If anyone relies on you financially, you need life insurance. It’s virtually obligatory if you are a spouse or the parent of dependent children. But you may also require life insurance if you are someone’s ex-spouse, life partner, a child of dependent parents, the sibling of a dependent adult, an employee, an employer or a business partner. If you are stably retired or financially independent, and no one would suffer financially if you were to be no more, then you don’t need life insurance. You may, however, consider using life insurance as a strategic financial tool.

Save Social Security For When You Need It Most–Later

Originally published CNBCI think we’ve been looking at Social Security retirement benefits all wrong. In the long-running debate about when to take Social Security — as early as age 62 or as late as age 70 — the focus has been on timing your claim to get the most money, in total, out of the social safety net.

Social Security Word Cloud

This is a circular argument that will never be fully decided until the Social Security recipient in question dies. So let’s shift the focus from the question “How do we get the most out of Social Security?” to “How do we get Social Security when we need it most?”

Simply put, you’re more likely to run out of money at the end of retirement than at the beginning.

If You Don’t Like The Market Today, Just Wait Until Tomorrow

Originally in ForbesIn my hometown of Baltimore, there’s an oft-heard saying that seems especially applicable when, like now, the seasons are changing: “If you don’t like the weather today, just wait until tomorrow.” For whatever meteorological reason, it’s not uncommon for an absolutely miserable Monday to turn into a gorgeous Tuesday. Temperatures have been known to swing as much as 20 degrees inside of an afternoon.

A scientific view of stock market history, unfortunately, shows us an even greater propensity for unpredictability and volatility.

Even the years that we refer to as the “good” ones, in retrospect, test our mettle. For example, between 1950 and 2014, a span of 65 years, the S&P 500 ended the year with a gain 51 times (or in almost 80% of them). Not bad. But in how many of those up years do you think investors would’ve found themselves in a “losing” position at some point in the year?

Every. Single. One. 

Congress Eliminates Two Popular (and Profitable) Social Security Claiming Strategies

The Bad News & The Good News

Originally published CNBCLast week, the world of retirement planning experienced the financial equivalent of a deafening record scratch, courtesy of a Congressional move to end two well-used Social Security claiming strategies. In a matter of months, “File-and-Suspend” and “Restricted Application,” which were on the verge of retirement planning rock-star status, will only be referred to in the past tense.

Social Security Claim Denied Stamp Shows Social Unemployment Benefit Refused

“File-and-Suspend” and “Restricted Application” — let’s just call them “FASRA,” because it’s not like there aren’t already enough government-related acronyms — were, Congress argues, unintended consequences of the Senior Citizens Freedom to Work Act.

Behavioral Economist Richard Thaler’s Message to Advisors: ‘Nudge For Good’

Originally in MoneyDaniel Kahneman and Amos Tversky legitimized behavioral economics—the study of how people really behave around money, as opposed to how economists say a rational person ought to behave.

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Then Richard Thaler and Cass Sunstein applied the lessons of behavioral economics to everyday life with their book Nudge. The duo nudged so successfully that in recent years, their prescriptions have been put to work in corporate retirement plans—and even public policy—on a global scale.

When I spoke to Thaler to discuss his newest book, Misbehaving, a series of stories documenting the rise of behavioral economics, he told me that he has a message for those who seek to employ his methods:

“Nudge, for good.”

And why does he say that?