Sometimes the best, most rigorously developed financial advice is so obvious, it’s become cliché. And yet, investors often end up abandoning this same advice when market turbulence is on the rise. Why the disconnect? Let’s take a look at five of the most familiar financial adages, and why they’re often much easier said than done.

Did you know? Aside from a few specialized cell groups, science suggests our body tends to regenerate itself with all-new cells about every decade. And yet, somehow, while the trillions of tiny components that comprise “you” and “me” may come and go, something greater within us has staying power, making each of us unique, enduring and important.

"Sellers were out in force on the market today after negative news on the economy." It's a common line in TV finance reports. But have you ever wondered who is buying if so many people are selling?

Let’s be clear: We did not wish for, nor in any way cause a tumble in the markets, especially among tech stocks. That said, we could not have come up with a more telling illustration to underscore the perennial value of building – and maintaining – a globally diversified investment portfolio for achieving your greatest financial goals.

As of August 21, the longest-running S&P 500 rally (by some counts) was born out of “the ashes of the financial crisis.” Then came mid-September – ten years since the beginning of the financial crisis of 2008 – along with the usual flurry of “decade after” reflections.

The path to success in many areas of life is paved with continual hard work, intense activity, and a day-to-day focus on results. However, for many investors who adopt this approach to managing their wealth, that can be turned upside down.

The average American spends more than $10,000 per person annually on healthcare expenses, including premiums, deductibles and coinsurance amounts.  For a large family, that amount can quickly become unsustainable. In the past, it was common for employers to absorb the majority of these costs, leaving the employee responsible for only a small portion.

Combining an enduring investment philosophy with a simple formula that helps maintain investment discipline can increase the odds of having a positive financial experience. 

 

“The important thing about an investment philosophy is that you have one you can stick with.”
^{David Booth, Founder and Executive Chairman}

The Impact of Inflation

When the prices of goods and services increase over time, consumers can buy fewer of them with every dollar they have saved.

We’ll wrap our series, the ABCs of Behavioral Biases, by repeating our initial premise: Your own behavioral biases are often the greatest threat to your financial well-being.