H. Ronald Miller CFP
If you can take good care of the present, the future will take care of itself, since the future is a time series of the present!
In the decade ending in 2009, we witnessed two major bear stock markets, two volatile rebounds, and an almost-total collapse of the global financial system. The U.S. and Western Europe, in particular, are dealing with the consequences of globalization and unbridled increases in individual and national debt. Over this past decade, the S&P 500 stock index actually lost 9.46 percent of its total return value, not including the loss of purchasing power due to inflation. It is one of the worst 10-year absolute stock market periods, along with the decade ending in 2008, since the Great Depression era. According to the CPI, the loss of purchasing power of the U.S. dollar over this past decade was 22.06 percent. That is a total loss of stock market purchasing power of 31.5 percent over a decade, even after the sharp rebound in 2009. These are truly difficult times and a topsy-turvy financial world for the investors to contemplate.
There are basically two types of investors. The first type is those who are young, let's say 45 or younger, and are saving money periodically in IRAs, 401(k)s, or other retirement-type accounts. This type of investing is a form of dollar cost averaging with a long-term viewpoint. These investors don't necessarily need to micromanage their ...