Category Archives: IRA

John Bogle’s Six Lessons for Investors

There is almost no limit to the ability of investors to ignore the lessons of the past. This cost them dearly last year. Here are six of the most important of these lessons for investors:

1) Beware of market forecasts, even by experts. As 2008 began, strategists from Wall Street’s 12 major firms forecast the end-of-the-year closing level and earnings of the Standard and Poor’s 500 Stock Index. On average, the forecast was for a year-end price of 1,640 and earnings of $97. There was remarkably little disparity of opinion among these sages.

Reality: the S&P closed the year at 903, with reported earnings estimated at $50.

Strategists aren’t always wrong. But they have been consistent, betting year after year that the market will rise, usually by about 10%. Thus, they got it about right in 2004, 2006 and 2007, but also totally missed the market declines in 2000, 2001 and 2002, and vastly underestimated the resurgence in 2003.

Ignore the forecasts of inevitably bullish strategists. Bearish strategists on Wall Street’s payroll don’t survive for long.

Read the rest of John Bogle’s column here.

Matt / Google+

Congress Revises Retirement-Fund Rules

A new tax law will allow retirees to skip required withdrawals from individual retirement accounts and related accounts this year. The change — signed into law by President Bush last month — is intended to give beaten-down nest eggs time to rebound from the brutal bear market.

But the new law may also create confusion, particularly for those just starting to take required withdrawals.

“The [existing] rules are confusing enough,” says Ed Slott, an IRA consultant in Rockville Centre, N.Y. “Now, more people than ever are going to get tripped up.”

Read the rest of the article at the Wall Street Journal.

Matt / Google+

Opt Out of Credit Card Offers

If you’re like me, you might receive one or two credit card offers in the mail every day.  These annoying letters attempt to entice consumers to sign up for them with promises of a 0% APR for six months, sporting goods, or bonus frequent flyer airline miles.  While some people might enjoy receiving these mailings, the majority of people that get them do not.  In addition to creating more trash that needs to be thrown out, these credit card offers also increase the risk of identity theft.  Although it may appear to be overkill, shredding these pre-approved credit card offers is highly recommended, as it makes it harder for potential thieves to acquire your personal information.

If you are sick of these mailings there is help.  Under the Fair Credit Reporting Act (FCRA), a person is able to opt out of receiving these mailings.  In order to do this, one has to go to a website and enter some personal information.  The website is and it works in conjunction with four consumer credit reporting companies (TransUnion, Equifax, Innovis, and Experian).  It will take up to a few months to completely stop receiving credit card offers, but the amount of junk mail one receives from credit card companies will be reduced significantly.

Matt / Google+