January 2022 Best of the Web

We’re only a month into the new year, and we’ve already had a wild ride in the markets. That seems like an appropriate place to start January’s selections.

We need to make a lot of assumptions when planning for retirement. We will undoubtedly make mistakes. This month’s resources will help us be a little less wrong with our assumptions.

Selections share doctors’ viewpoints on how life changes after achieving financial independence, what happens to your brain after retirement, and how to navigate life in a world where COVID will likely exist indefinitely.

I have a couple of book recommendations. The final selection explores the change in mindset that is required to switch from being a super saver, as required to achieve financial independence and retire early, to spending from your investments to improve your life after reaching your financial goals.

Enjoy and have a great month!

A Little Bit of Market History

It’s been a crazy start to the new year. Ben Carlson contemplates a question many investors are asking: When Will the Stock Market Bottom?

Allan Roth wrote 2021: Deja Vu All Over Again For Stocks. This is a great review of how different asset classes performed in 2021. I almost cut this article out, because it feels a little dated already, but it is an important reminder of the importance of diversification and how fast markets can change.

Predicting Future Market Returns and Inflation

At the beginning of each year, Kim and I like to review our previous year end financial numbers and enter them into the newest versions of the Pralana Gold and NewRetirement calculators that the blog affiliates with. (Look for updated reviews of each in future blog posts.)

As confident as we are in these tools and our knowledge of retirement planning, this annual exercise is a reminder of how much we can not know or control. Change a few assumptions slightly and compound the results over decades and the difference in outcomes is staggering.

So while there are no knowable right answers as to what numbers to enter, it helps to at least be educated to the possibilities. The following articles were useful in those regards.

Christine Benz shared Experts Forecast Stock and Bond Returns: 2022 Edition. It provides a variety of possible return possibilities for the next 10-15 years, which is a key time period for those contemplating or already early in their retirement.

Karsten “Big ERN” Jeske writes Inflation at 7%! Here’s why I’m not running for the hills (yet)! This is just one blogger’s opinion, but that blogger has a PhD and work experience at the federal reserve, so I take his opinion a bit more seriously than others.

Keeping IBonds Simple

Last summer, I outlined the potential benefits of having I Bonds in your portfolio. That blog post was very popular. I’m seeing I Bonds discussed in many other places since inflation (and corresponding inflation adjustments on I Bonds) has spiked recently.

So I’m assuming many of you, like me, have bought I Bonds recently. If you have, Harry Sit explains the options you have to manage the taxes, and why the simplest path is most likely the best: Taxes on I Bonds Get Complicated If You Go Against the Default.

Physicians on Financial Independence

I enjoyed the different perspectives shared by Jim Dahle, aka the White Coat Investor, and Leif Dahleen, aka the Physician on FIRE, on what changed and what didn’t, respectively, for each after achieving financial independence. Life After Financial Independence: Two Perspectives.

A Physician on Retirement

Dr. Bapu Jena examines what happens to your cognitive abilities and psychological health after retirement. Of particular interest to me was the difference between males and females. How Does Retirement Affect Your Brain?

Physicians on COVID

The pandemic has altered life in ways I couldn’t have imagined when it started two years ago. Even more concerning to me than the disease itself, is how the response has further tribalized our society.

This blog mostly focuses on the financial aspects of life and takes great effort to avoid politics. The next resources violate both of those principles, because I think they’re worth sharing.

Kim and I got a ton of value listening to the nuanced discussions Peter Attia moderated on his podcast to help make sense of all of the conflicting information about the pandemic.

COVID Part 1: Current state of affairs, Omicron, and a search for the end game

COVID Part 2: Masks, long COVID, boosters, mandates, treatments, and more

A New(ish) Book to Help Make Better Decisions About Social Security

Mike Piper released an updated version of his book Social Security MadeSimple. This concise yet detailed book on such an important topic is highly recommended to readers of this blog contemplating retirement.

For more, read Darrow’s thoughts on an earlier version of the book: When To Take Social Security.

A New Book to Help Others Get Better With Money

The fact that you’re reading this means that you’re a bit of a personal finance nerd. (Sorry if you weren’t already aware and I offended you.)

The reality is the vast majority of people have no interest in personal finance and find it overwhelming. Joe Saul-Sehy hosts the award-winning Stacking Benjamins podcast where he uses comedy to make this serious topic a little more accessible and a lot more fun in an effort to draw in some of those people.

He recently teamed up with author Emily Guy Birken to bring that same energy to a new book, Stacked: Your Super-Serious Guide to Modern Money Management. If you are looking for a resource to get someone interested in personal finance, consider buying them a copy.

Does Your Mindset Match Your Wealth?

This month, after reading Morgan Housel’s book The Psychology of Money, I wrote a post about the Psychology of Saving Money. 

In the FIRE community, we are masters of saving money. But as Kim and I have made our transition to a new lifestyle and I continue to follow other bloggers in my cohort, I realize we in the FIRE community haven’t necessarily mastered all aspects of money.

Many of us are natural savers. Often that’s hard wired emotionally. Our propensity to save is not always healthy. It’s often not easy to spend and enjoy the money we’ve saved and invested.

Carl Jensen shares how he continues to struggle with this mindset and a framework he’s using to think about money differently, writing It Was Never About Frugality.

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[Chris Mamula used principles of traditional retirement planning, combined with creative lifestyle design, to retire from a career as a physical therapist at age 41. After poor experiences with the financial industry early in his professional life, he educated himself on investing and tax planning. Now he draws on his experience to write about wealth building, DIY investing, financial planning, early retirement, and lifestyle design at Can I Retire Yet? Chris has been featured on MarketWatch, Morningstar, U.S. News & World Report, and Business Insider. He is also the primary author of the book Choose FI: Your Blueprint to Financial Independence. You can reach him at chris@caniretireyet.com.]

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