There’s something odd going on in the housing market. Mortgage rates are appreciably higher than they were a year ago, but home prices—on average—have yet to fall. In recent months, house price increases have slowed, but as of the most recent reading, prices are nonetheless still increasing on a [...]
Exactly Wrong
Last week, I talked about Carveth Read, the English philosopher who’s famous for saying, “It is better to be vaguely right than exactly wrong.” This, in my view, is one of the most important ideas in personal finance. Last week, the focus was on the “vaguely right” side of the equation. But what [...]
Roughly right
One of the most important ideas in personal finance comes not from a finance expert but from a twentieth century English philosopher named Carveth Read. “It is better to be vaguely right,” he wrote, “than exactly wrong.” Why is this idea important? It gets at the heart of why financial planning [...]
Your future self
In behavioral finance, there’s an important concept that doesn’t get a lot of discussion: It’s called temporal discounting. The idea is that we tend to view our current and future selves, to some degree, as different people. And thus, there’s the tendency to discount the needs of that “other” [...]
The other answer
In personal finance, there are usually two answers to every question: There’s what the calculator says. And then there’s how you feel about it. What does that mean in practice? Let’s look at an example. Suppose you’re considering when to claim Social Security. Many struggle with this question. On [...]
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