6 Investing Myths to Avoid

FAANG stocks are slowing down
July 9, 2021
Retire with Money
I’m old enough to remember when you were supposed to subtract your age from 100 to get the percentage of your portfolio that should be in stocks. But that rule of thumb has fallen out of favor as lifespans have increased. These days, you’re supposed to use 110 instead (with the caveat that rules of thumb are general advice, and every investor’s situation is different). Today’s featured story explores investing misperceptions. It’s a smart look at beliefs that could be costing you money. For example, folks might think you need to pay off all your debt before you start investing for retirement. While this impulse is understandable, you shouldn't wait to harness the power of compound interest. Check out the full list of investing myths in today’s edition.

Best wishes,
Elizabeth
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Timely Retirement News, Insights, And Advice

It’s not easy to get rich quick. 

Advocates are pushing for pandemic relief to be extended.

Retire With Money Community News

Please welcome our Reader of the Week! Garey Morrison, 66, is a retired CPA. He lives with his wife of 40 years, Patty, in Trussville, Alabama.
What are you up to these days?
I serve my local United Methodist Church as a member of the finance committee, vice chair of our wonderful day school program, a Stephen Minister and other duties as they pop up. I am a board member and treasurer of the North Alabama United Methodist Foundation. We have three wonderful grandkids (the “Grands”) who are involved in a variety of dance and sports activities. The Grands love attending University of Alabama sporting events. Their favorite is probably our women’s basketball team but football is near and dear to every Bama fan’s heart.
 
Nice! What’s your approach to investing for retirement?
Number 1, start planning regardless of your age. Number 2, seek out good advice. Number 3, keep reading about taxes and financial developments. Finally, do not go on “auto pilot.” Some of the investments I made in preparation for retirement had a significant shift in their asset allocation. That was a big wake up call. For example, a very well-known mutual fund company changed all of their target date retirement funds to a higher international stock allocation. Their international percentage was above my comfort point so I moved my account in early 2018. In hindsight it helped me be better prepared to weather the COVID-19 roller coaster. It is not fun to read mutual fund reports BUT you have to. My investing philosophy has shifted from just building a nest egg to taking some calculated risks. In 2007, we invested in a start-up community bank. The bank opened in the middle of the 2008/2009 financial crisis. Great timing, right? The good news is that the bank’s leadership team was very skilled and the bank is doing very well.   
 
Whew! Any regrets you'd like to share?
Money regrets: chasing after investment gains versus building for the future. When the Hunt brothers tried to corner the silver market in 1980 I jumped on the train and lost my fanny. It was a very valuable lesson.

Retirement News From Around The Web

How to Rebuild Your Personal Finances During an Economic Recovery
If the past year was rough on your finances, these steps can help mitigate the damage. CNBC

Paying Billions for Controversial Alzheimer’s Drug?
Experts outline funding priorities that could have a more positive widespread impact than the drug Adulhelm. KAISER HEALTH NEWS

Ageism in the Workplace: a Complete Guide
The pandemic has exacerbated some of the challenges older workers face. THE LADDERS

How Men Adapt to Being Solo Agers
“Guys must be friendly to have friends,” and other practical advice. NEXT AVENUE

Elizabeth O'Brien is deputy editor at Money. She has covered retirement and health care for nearly a decade. A Brooklyn resident and mom of two boys, she navigates the alphabet soup of Medicare and the New York City subway system with equal ease. You can email her at elizabeth.obrien@money.com and follow her on Twitter at @elizobrien.
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