One of the biggest mistakes investors make in estimating future returns is using historical ones. The past is not a predictor, according to the author of Investment Mistakes Even Smart Investors Make and How to Avoid Them, Larry Swedroe. He explains why you should steer clear of this costly error in Advisor Perspectives. One of the best things you can do for your portfolio and your health is to schedule regular financial planning. Rob Williams describes the connection between health and wealth. Should you ever need long term care, however, you’ll also need insurance to cover it. The AICPA offers a list of features and benefits that can help you compare policies.

A Common And Costly Mistake Investors And Their Advisors Make–  Specifically, it’s the error of using historical stock and bond returns as the best estimator of their future returns. The rationale for the behavior is typically that forecasts other than those using historical returns are nothing more than opinion. Unfortunately the use of historical returns in retirement planning is highly likely to lead to failure (meaning investors outlive their assets) because, for both stocks and bonds, it leads to a forecast that’s extremely unlikely to occur. The reason is that stock valuations are much higher than they have been in the past, and bond yields are much lower.  Larry Swedroe of BAM Advisors explains in this article. Read more…

Healthy And Wealthy: How Planning Can Boost Your Well-Being–  Researchers have identified interesting links between health and wealth that underscore the benefits of planning.  Rob Williams from Schwab discusses this research and actions you can take. Read more…

Comparing Long-term Care Insurance Policies–  Long-term care insurance (LTCI) policies come in many shapes and sizes. The sheer number of options available can make it difficult to choose a policy. The AICPA makes the comparison easier with this article in 360 Degrees of Financial Literacy. Read more…

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John R. Day, Bill Ennis, Stephanie Davidson and Matt Heller

Disclosure – The articles mentioned in Mid Week with Day & Ennis are for information and educational purposes only. They represent a sample of the numerous articles that the firm reads each week to stay current on financial and economic topics. The articles are linked to websites separate from the Day & Ennis website. The opinions expressed in these articles are the opinions of the author and not Day & Ennis. This is not an offer to buy or sell any security. Day & Ennis is under no obligation to update any of the information in these articles. We cannot attest to the accuracy of the data in the articles