Economy

Is This Inflation A Repeat of the Hyperinflation of the 70s?

March 3, 2022 by Hans Blake, CFA, CPA

Reading Time: 2 minutes

On today’s Intelligent Money Minute, we’ll interview Ed Peters on whether this inflation is a repeat of the hyperinflation of the 70s? During this episode, Ed walks us through the history of inflation starting in the 1970s. He believes that the current inflation the U.S. is experiencing will not last long. He notes that the current inflation is more a perfect storm than a monetary issue.

The late 70s hyperinflation period was in part caused by the OPEC supply-side shock of 1973. There are reasons why the current inflationary period may be transitory. As Ed mentioned, there is a perfect storm of both a demand and supply shock that is similar to coming out of World War II.

As a result, we think intelligent investors shouldn’t overreact to our current inflationary environment, but be prudent in understanding the reasons why we may be having inflation, and by understanding the cause or causes, we may be able to set proper expectations for the future.

Many people believe that the current inflation we are experiencing is due to all the stimulus checks and programs the government has put out over the past few years. While this increase in money supply can cause inflation, there are indicators that are telling a different story. We’ll be talking more about this and why the velocity of money (or how fast are Americans spending money) in future Intelligent Money Minute podcasts, so be sure to subscribe to our podcasts so you can stay informed.

Ed Peters Bio

Ed Peters is First Quadrant’s Managing Partner. In this role, Ed establishes the firm’s strategic direction, develops firm-wide initiatives, and chairs the Executive Leadership Team and the Management Operating Committee. Ed also contributes to First Quadrant’s research efforts, with a particular emphasis on market states, and manages the firm’s long-only multi-asset strategy. Prior to joining First Quadrant in 2008, Ed worked at PanAgora Asset Management, at various times serving as equity portfolio manager, Director of Tactical Asset Allocation, CIO of Macro Investments, and CIO. Other past work experience includes Interactive Data Corporation and Mutual Benefit Life. Ed holds an MBA from Rutgers University. He has published articles in multiple investment journals, as well as three books.

The History and Three Causes of Inflation

February 24, 2022 by Hans Blake, CFA, CPA

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On today’s Intelligent Money Minute, we’ll interview Ed Peters on the history and three causes of inflation. During this episode, Ed walks us through the history of inflation starting in the 1970s. He explains the types of inflation and what causes them. He stresses the importance of accurately diagnosing inflation in order to appropriately address it.

It is important to get an idea of the history of inflation to get an understanding of the current inflationary environment. Inflation can be caused by a number of reasons—primarily money supply, supply shocks, or demands shocks.

Since we haven’t dealt with inflation for about 40 years, there are a lot of myths surrounding inflation and our current environment. It is vital that you are able to properly diagnose inflation to understand the cause of inflation. We’ll be talking with Ed about Inflation in a number of upcoming podcasts where he will share what he thinks may be the cause of inflation and ways you can deal with it, so as an Intelligent Investor be sure to subscribe to our podcasts so you can stay informed.

Ed Peters Bio

Spending Money in Retirement with Christine Benz

August 26, 2021 by Hans Blake, CFA, CPA

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On today’s Intelligent Money Minute, we continue our conversation with Morningstar’s director of personal finance, Christine Benz on spending money in retirement. During this episode, Christine about retirement distribution strategies and whether there’s truly a safe withdrawal rate. Interestingly enough, she mentions a study that more retirees were concerned about finances than death. She highlights this strategy of simply taking 4% and whether it’s still usable in today’s economy.

Many pre-retirees and retirees are concerned about running out of money. Having a written financial plan and having flexibility with withdrawals are some of the keys to having a good probability of success of not running out of money.

Are you are wondering whether you have enough money to outlast your lifetime? If you are, we’d love to have a complimentary call or coffee with you. We are fee-only fiduciaries that don’t sell other products, so you can rest assured, we want to have your best interest in mind. Please visit investedwithyou.com. We look forward to hearing from you soon.

Schedule a short discovery call or meeting

We’ll be interviewing Christine on several podcasts regarding retirement strategies, passive investing, and diversification, so be sure to subscribe to our Intelligent Money Minute podcasts.

Christine Benz Bio

Christine Benz is Morningstar’s director of personal finance and author of 30-Minute Money Solutions: A Step-by-Step Guide to Managing Your Finances and the Morningstar Guide to Mutual Funds: 5-Star Strategies for Success. She holds a bachelor’s degree in political science and Russian/East European studies from the University of Illinois. Christine lives in the Chicago suburbs with her husband, Greg. She is an avid cook, a political junkie, and a long-suffering Chicago Cubs fan. Follow Christine on Twitter.

How Potential Higher Inflation and Taxes Impact Your Retirement Strategy

July 29, 2021 by Hans Blake, CFA, CPA

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On today’s Intelligent Money Minute, we continue our conversation with Morningstar’s director of personal finance, Christine Benz on how potential higher inflation and taxes impact your retirement strategy. Christine believes we should be mindful of potential inflation and high taxes. A key point she makes is not waiting to implement tax-saving strategies. During this episode, she explains the value of tax-deferred accounts. Tax-deferred accounts blended with other financial vehicles could be beneficial to your financial strategy.

At Intelligent Investing, one of our unique factors is that we strive to minimize fees and that includes government fees. There are many planning opportunities, especially in the sweet spot years between retirement from an employer and when you start social security benefits. We love organizing our clients’ financial junk drawers, and we’d love to organize yours. To learn more about Intelligent Investing or to become our next intelligent investor, please visit investedwithyou.com.

Schedule a short discovery call or meeting

We’ll be interviewing Christine on several podcasts regarding retirement strategies, passive investing, and diversification, so be sure to subscribe to our Intelligent Money Minute podcasts.

Christine Benz Bio

The Retirement Bucket Approach Part 2

July 21, 2021 by Hans Blake, CFA, CPA

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On today’s Intelligent Money Minute, we continue our conversation with Morningstar’s director of personal finance, Christine Benz on the retirement bucket approach. During this episode, Christine expounds further on the bucket approach and behavioral finance. Hans and Christine talk about situations where investors reacted poorly to market situations. Christine stresses the importance of sticking to your financial planning during uncertain times.

At Intelligent Investing, we strongly believe in behavioral coaching. We believe that the behavior gap (the difference between actual investment return vs. actual investors’ returns) can be significant and minimized if advisors and clients behave properly. This often means doing the hard thing and not chasing after returns or headlines. It also means turning off the scary headlines that make you want to abandon your portfolio and plan. To learn more about behavioral finance and our philosophy, please visit investedwithyou.com.

Schedule a short discovery call or meeting

We’ll be interviewing Christine on several podcasts regarding retirement strategies, passive investing, and diversification, so be sure to subscribe to our Intelligent Money Minute podcasts.

Christine Benz Bio

The Retirement Bucket Approach

July 8, 2021 by Hans Blake, CFA, CPA

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On today’s Intelligent Money Minute, we interview Morningstar’s director of personal finance, Christine Benz on the retirement bucket approach. Christine has been a longtime believer in this retirement bucket strategy. During this episode, Christine defines the retirement bucket approach and highlights the pros and cons of this strategy. The basic idea is securing one to two years of portfolio withdrawals. A critical component of this approach is setting aside cash reserves. Liquid reserves can bring peace of mind to those employing a long-term portfolio strategy. There is some initial risk building this cash reserve, but you build yourself a bulwark that you can spend through as opposed to a depreciated equity holding.

It is important if not vital for retirees to have a plan for liquidity needs. Perhaps setting aside 1-2 years of living expenses in a money-market type of account or investment is best. Perhaps it is utilizing a bucket approach. Without understanding a clients’ needs, wants, and wishes, and having a timeline for when those expenses may occur, your plan and/or portfolio may not be optimized. We’d be happy to have a quick call or coffee with you to start the conversation of how we may best serve you and your family. To get started, please visit investedwithyou.com.

Schedule a short discovery call or meeting

We’ll be interviewing Christine on several podcasts regarding retirement strategies, passive investing, and diversification, so be sure to subscribe to our Intelligent Money Minute podcasts.

Christine Benz Bio

How Retirees Can Replace Their Income in a Low-Yield Environment

June 23, 2021 by Hans Blake, CFA, CPA

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On today’s Intelligent Money Minute, we interview Morningstar’s director of personal finance, Christine Benz on low-yield bonds. During this episode, Christine gives her perspective on what retirees can do in the current low-yield environment. She encourages retirees to consider a total return approach to their portfolios. Each year take a step back and determine the best place to pull cash flows. Christine believes the best location for retirees to go for cash flows is hiding in plain sight. In their appreciated equity holdings. Trimming appreciated holdings is a way to supply cash flows for a couple of years while reducing risk in the portfolio. The key is to not be dogmatic about your income, but being a tad eclectic in your approach.

At Intelligent Investing, we believe in a total return approach when it comes to our clients’ income needs By combining both ordinary income from dividends and interest along with selling appreciated investments that have capital gains, we can help supplement our retiree’s cash needs from the portfolio. By not being dogmatic, we believe the flexibility provides more tax planning opportunities and may lower the tax burden from solely focusing on just dividends or interest which can be taxed at much higher rates. To learn more about our philosophy, please visit investedwithyou.com.

Schedule a short discovery call or meeting

We’ll be interviewing Christine on several podcasts regarding retirement strategies, passive investing, and diversification, so be sure to subscribe to our Intelligent Money Minute podcasts.

Christine Benz Bio

The Four Horsemen of the Retirement Apocalypse

April 15, 2021 by Hans Blake, CFA, CPA

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On today’s Intelligent Money Minute, we interview Larry Swedroe on the four horsemen of the retirement apocalypse. Larry explains the importance of investors not using historical returns for blindly forecasting the future. On the contrary, Larry explains the need to understand how the returns earned value. During the episode, he goes through misconceptions about equity evaluations, optimistic forecasting, and bond yields. Larry explains in detail the four horsemen of the retirement apocalypse:

Equity evaluations are much higher
Bond yields are lower
Longevity risk
Long-term care risk

As Larry mentioned, the Four Horsemen of the Retirement Apocalypse can seem scary and produce fear in your hearts. As you approach or if you are in retirement, there are some ways to plan for such events. At Intelligent Investing, we minimize financial stress to maximize lives. Our goal is to create a written financial plan and stress test your plan and portfolio for these types of events. We’d love to sit down with you over a complimentary coffee or virtual meeting to discuss how we may serve you and your family. Don’t face retirement alone…let us be your financial accountability partner and we can face the future together.

Schedule a short discovery call or meeting

We’ll be interviewing Larry on several podcasts regarding markets, passive investing, and diversification, so be sure to subscribe to our Intelligent Money Minute podcasts.

Larry was among the first authors to publish a book that explained the science of investing in layman’s terms, “The Only Guide to a Winning Investment Strategy You’ll Ever Need.” He has since authored seven more books.

Larry Swedroe Bio

Since joining the Buckingham Strategic Wealth in 1996, Chief Research Officer Larry Swedroe has spent his time and energy educating investors on the benefits of evidence-based investing.

In his role as chief research officer and as a member of the firm’s Investment Policy Committee and Board of Directors, Larry regularly reviews the findings published in dozens of peer-reviewed financial journals, evaluates the outcomes and uses the result to inform the firm’s formal investment strategy recommendations.

Larry’s dedication to helping others has made him a sought-after national speaker. He has made appearances on national television shows airing on NBC, CNBC, CNN and Bloomberg Personal Finance. Larry is a prolific writer, contributing regularly to multiple outlets, including Advisor Perspectives and ETF.com.

Before joining Buckingham, Larry was vice chairman of Prudential Home Mortgage and senior vice president at Citicorp.

Larry holds an MBA in finance and investment from NYU and a bachelor’s degree in finance from Baruch College.