This series of videos features School of Management Professor Zvi Bodie discussing key topics in personal finance. From the hidden risks in your 401k to the age you should retire, Professor Bodie covers much of the ground in his earlier book Worry Free Investing.
Three Crucial Tips
As co-author of the leading textbook on investments, Zvi Bodie often gets asked for guidance. In this video, he gives three crucial tips. Think of investment as something that has to protect you. Trust no one. And read: there is plenty of fascinating, reliable material to learn from.
Set Realistic Goals
How can you tell whether your goals are realistic? Bodie shows how to get started by first assuming that all your investments are risk free. How much will you have to save, and for how long?
The Conventional Wisdom is Wrong
How many times have you heard not worry about market risk as long as you are investing for the long run? Professor Bodie shows how your time horizon has nothing to do with your willingness to take risk. Risk does not diminish over long time periods.
I Hate Losing
What’s a good way to think about investment risk? What if you just got a “hot tip” about a stock? The main thing is to be sure not to harm your standard of living. Think about whether you can afford to lose your money.
Stay in the Labor Force
What’s the best advice for people who have lost a big part of their nest egg? Professor Bodie says the answer is not to “sit tight” and wait for the market to come back. The best response is to stay in the labor force.
I Love the Stock Market
As a professor of finance and investing, Professor Bodie loves the stock market. But he doesn’t love the educational materials put out by the investment industry. They can do a lot of damage.
The Safest Investment is TIPS
Inflation-protected bonds are the safest investment around. Here’s how they work and where you can get them.
Don’t Trust Just Anyone
You are responsible for your own well being. But how can you find advice that you can trust? Be on the lookout for a fiduciary–that’s someone who has pledged to put your interests first.
You’re On Your Own
Employer-sponsored pensions that pay a defined amount in retirement are disappearing. Instead, it’s up to you to make sure your contributions end up covering you after you retire. Don’t assume that Target-date funds will do the trick. They have no guaranties.