Adaptive Estates

Key Takeaways

  • Big life changes involve both technical challenges and adaptive challenges.
  • Change becomes harder as you get older.
  • With estate planning, you don’t want to pass along just your money, but also the values that go along with it.

Top 5 Family Legacy Pitfalls

Key Takeaways

  • Lack of documentation, poor planning and failure to prepare the next generation for their inheritance can easily derail a family’s estate plans.
  • Get wills, trusts, powers of attorney and other legacy planning issues in writing to minimize disputes about where (and to whom) your assets will go.
  • If you decide to give a lot of money to your children and grandchildren, make sure they understand your family values so they won’t use their newfound wealth irresponsibly.

5 Keys to Dealing with Loss Aversion

Editor’s Note: Gary recorded this video a few weeks ago before the recent downturn in the markets.  But the message is as relevant as ever.  

Key Takeaways

  • Behavioral finance shows that we feel the pain of a loss twice as strongly as we enjoy the thrill of a gain.
  • If you’re retired or unemployed, make sure you have three to five years of ready cash at all times to cover your expenses.
  • You also need a clear path and plan, a long-term portfolio, a relationship with a trusted advisor, and the ability to engage in slow versus fast thinking.

Avoiding the Big Mistake

Key Takeaways

  • Research shows our decisions are too often clouded by biases and irrationalities.
  • There are four primary causes of human error: confirmation bias, emotion, tunnel vision and overconfidence.
  • There are four key steps for overcoming your biases (see post below). Sometimes the answer is right in front of your nose.