Small Businesses/Franchise/Angel Investing

To save for your future self. To preserve your money against inflation. To replace your human capital with financial capital. We will review each of these ideas in turn and discuss why they are important for your personal finances.

To reduce risk. To generate a return greater than the cost to borrow.

While your home is unlikely to crash in value, it’s also unlikely to be your long-term ticket to wealth either. More importantly, even if you see your home price increase significantly, you can only extract that value if you sell and buy a cheaper home elsewhere, or if you sell and go back to renting.

Given that you (like most investors) will be accumulating assets for most of your life, this means that your most important

The only difficult thing about the accumulation rebalance strategy is that it becomes harder to pull off as your portfolio increases in size. While it’s easy to add money to rebalance your portfolio when it is small, as it gets bigger you may not have enough cash to keep up. In those instances, selling in your

To follow the 4% rule, you would need to save 25 times your expected spending in your first year of retirement.

This is evidence that, on aggregate, millennials don’t seem to be building wealth at a slower pace than prior generations. Yes, there are issues with the distribution of that wealth and how much debt some millennials have, but the overarching story isn’t as dire as the media usually makes it out to be.

As you can see, in all periods tested, cash underperformed bonds when saving over such a long time horizon. Does this mean that there is an optimal point at which you should stop saving cash and start saving in bonds? Not exactly, but we can come up with a good guess. For example, given that a two-year savings time horizon slightly favors cash and