(no subject)

[jenk]

From the "10 faves" list that Jonathan Clements (of the Getting Going WSJ column) picked for his last day comes this translation of Investor to English. A few excerpts:

"I'm happy to earn the market's return"	But only when stocks are going up.
"I have a very high risk tolerance"	I won't panic and sell until I've lost a truckload of money.
"I'm a conservative investor"	I have only half my portfolio in tech.
"I'm well diversified"	I own three stocks.
"The fund's got a great record"	I'm an expert at predicting past performance.
"I own last year's top-performing fund"	The problem is, I bought it this year.
"I've made a ton of money in the stock market"	It's a shame most of my portfolio is in bonds.
"I picked a stock that doubled last year"	Don't ask what else I picked.
"I've done really well in recent years"	I couldn't calculate my rate of return if my life depended on it.
"I never open my statements"	I've lost so much money, I can't bear to look.

Other gems: Money & Happiness; How Houses Eat Money, or much money do you really make when your house doubles in value; Twenty Tips for No-Nonsense Investing; and Sales School: What Your Insurance Agent Is Learning From the 'Annuity Gladiator'.


I also like his final column, where he asks "why do all this saving & investing?" His answer, characteristically, involves a list:

1. If you have money, you don't have to worry about it. This isn't guaranteed. [...] This feeling of financial serenity isn't, however, only for the wealthy. If you live beneath your means and invest prudently, you can achieve a sense of financial control long before you achieve full financial independence. [...]
   
   
2. Money can give you the freedom to pursue your passions. Ideally, you want to spend your days engaged in activities that you find absorbing and satisfying, that you feel you're good at -- and where you feel you're doing good.
   
   [...Y]ou don't need to be financially independent to have a sense of purpose. If you're young, you can pick a career that is close to your heart. If you're in your 40s and you have been saving for 15 or 20 years, maybe you can afford to swap into a new job that is less lucrative but more fulfilling.
   
   
3. Money can buy you time with friends and family. [...W]hile money makes all this easier, it clearly isn't a necessity. Disgruntled with your lot in life? My advice: Forget spending more money at the mall -- and instead spend more time with friends. Your bank account may still be skimpy, but your life will be far, far richer.

Note he's not talking about Bill Gates rich or dot-com rich. He's talking about having some extra squirreled away so that you can cope with unexpected expenses or job changes or moves. Regularly living below your means is like a UPS that'll keep your computer up a few hours. No, it's not as long-term as a building full of generators, but it'll let you go through short power outages without a problem ... and give you time to save & shut down during a big outage.