INTRODUCTION
“It makes no sense for individual investors to jump in and out of the market. People who trade in that way rarely die rich, whereas the patient investor often does.” – Philip Carret
Human beings’ “fight-or-flight” response was the result of an evolutionary process taking place during a very different time. It was effective at keeping primitive man or woman safe in the face of a predator, but it makes the average person a bad investor. While everyone understands that buying low and selling high is important to achieving investment success, too many do just the opposite in practice. Fear causes us to sell when prices are depressed and greed encourages us to chase securities that have recently performed very well. [Read more…] about Q3 2020 Investment Letter
Along with wages and healthcare, the ability to participate in a retirement plan, usually a 401(k), is a key component of a company’s employee compensation package. 410(k) plans offer employees the ability to defer the taxation of contributions until the money disbursed from the 401(k). The employee benefits from a reduction in taxable income in the year of contribution, as well as the compound growth over time of the amount that would have been paid to Uncle Sam. Furthermore, about half of employers offering 401(k) plans match employee contributions, with the