This week’s top reads include articles with insightful information—you will be better equipped for market volatility, retirement, and business leadership for having read them.
In the personal finance section, Morgan Housel packs in-depth information on efficiency and conservation into one fantastic article, Cullen Roche explains how patient investors are doing it better, and Joseph Coughlin outlines why gray divorces are skyrocketing and how to avoid one.
In the personal interest section, Fred Wilson shares the importance of executive sessions after your board meetings and Knowledge@Wharton interviews authors Art Kleiner and Jeffrey Schwartz on the lessons that neuroscience can teach leaders about better decision-making.
In this article, Morgan Housel discusses the role of conservation and efficiency in our everyday lives and our portfolios. He explains that much less energy is required today to do the same things that we did in the past, using the oil and gas industry and the increase in average miles per gallon our vehicles get as examples.
Housel goes on to explain that we have control over efficiency, and it is those things we have control over that will make the biggest difference for us in the long term.
Personal savings and frugality – finance’s conservation and efficiency – are parts of the money equation that are largely in your control and have a 100% chance at being as effective in the future as they are today.
Housel considers whether we should be paying more attention to efficiency or conservation and does so by examining the time and effort required to earn another 0.1% and how to be satisfied with spending less.
The idea that there are two ways to improve your financial wellbeing, and one is more in your control with higher odds of success than the other, is as overlooked in finance as it has been with energy.
Read the full article here.
Are you a patient or impatient investor? In this article, Cullen Roche discusses the theoretical investor who slept through the market crash in 1987, the year the markets dropped 23% in a single day. However, at the end of the year there was a total return of 5.81%. Someone who slept through that year would think they did “pretty okay,” but someone who watched the numbers every day likely had a much different experience.
Roche uses graphs to demonstrate that patience is the intelligent investor’s greatest strength. On one graph he shows a patient investor’s view of the markets – an investor who simply checks in four times a year, compared to that of an investor who obsessively checks on the closing numbers each day. Both go through the same market changes, but have very different experiences.
For the full article, click here.
Gray Divorce (divorce among couples 50 years of age and older) has increased by 700% since 1960 – and money isn’t the (only) problem. Joseph Coughlin uses a couple, Patty and Chris, as an example of why gray divorces are becoming so common. Patty worked throughout her life to build friendships and routines, and in her retirement she found her love of tennis and volunteering again. Chris invested so much of himself in his work that his friendships dwindled and he was no longer fun.
Identifying new interests and activities is a first step, but investing time to develop those interests before retirement is critical, e.g., joining a new club, taking a part-time class, volunteering an hour or two a week, while still working.
To learn how you can implement fun into your retirement planning, read the full article here.
Venture capitalist, Fred Wilson discusses the importance of performing executive sessions with your board. While this means that board meetings will be longer than usual, the results are invaluable.
CEOs need to know where the board stands on the meeting, the big issues, the team, the strategy, and most importantly the performance of the CEO. And CEOs need to know that in real time and all the time.
Read more about how you can make the most of your board meetings here.
Can neuroscience help you become a better business leader? The book, The Wise Advocate: The Inner Voice of Strategic Leadership tells us it can. In this article (and podcast episode) Knowledge@Wharton interviews authors Art Kleiner and Jeffrey Schwartz on the lessons that neuroscience can teach leaders about better decision-making. Read the full article here to learn how leadership and neuroscience go hand in hand, the harmful habits we can form when under stress, and some inside information from The Wise Advocate.