You Need to Be Investing!

Whatever bad things you want to say about them, Millennials are good at saving.

This is assumed to be due to being in their formative years when the 2008 recession happened. One expert noted that prior generations saw “plenty of boom times where the stock market was going up, home prices were going up, so they didn’t feel they had to save.”

Millennials saw that markets can go down and home prices can go down and placed more emphasis on emergency savings and a bit less on consumption.

That’s great news! The bad news is that Millennials aren’t investing the extra cash that they are stowing away. Continue reading “You Need to Be Investing!”

Buffett’s Bet

There is a dispute over how you should be investing your money and Warren Buffett has lined himself up as the antagonist of hedge fund managers.

Before jumping into the fight, a quick primer on active and passive investing: Active funds are actively managed (and clearly creatively named) funds in which the fund manager tries to pick investments that will perform better than the market. Passive funds (or index funds) are funds that simply try to match an index rather than beat it. For example, instead of trying to pick the companies that will outperform the market, a passive S&P 500 index fund will purchase every company in the S&P 500.

Warren Buffett, the third richest man in the world, is a big believer in passive investing for the average investor. While he takes an active role in managing the investments of his company, Berkshire Hathaway, he believes that the vast majority of people are better off placing their money in low fee index funds and investing passively. Continue reading “Buffett’s Bet”