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3 Things 12-11-23

Thing One


Race Like A Turtle


We‘ve mentioned multiple times the notion that the market will be volatile.  There’s no real wisdom in that statement.  The history of the stock market tells us it’s a fact. 


The S&P 500 index closed November of 2022 at 4087 and it closed November 2023 at 4567.  But ten years ago, it closed November at 1806.  It’s up over two and a half times in ten years. That means, if you had invested one million dollars in November of 2013 - and stayed invested - you’d have over two and a half million today.  Still, it would have been quite easy to become unnerved over the last ten years as you lived through the downs in the market.  As hard as it may be, you should resist the selling urge that often accompanies that anxiety.  That’s not to say you should go on a buying spree every time the market goes down.  Buying “the dips” is not always prudent.


What is always prudent, assuming you have a long-term investment outlook, is utilizing the well-known investment technique called dollar-cost averaging.  See the summary of the technique below taken from


"...DCA is a practice wherein an investor allocates a set amount of money at regular intervals, usually shorter than a year (monthly or quarterly). DCA is generally used for more volatile investments such as stocks or mutual funds, rather than for bonds or CDs, for example. In a broader sense, DCA can include automatic deductions from your paycheck that go into a retirement plan. For the purposes of this article, however, we will focus on the first type of DCA.


DCA is a good strategy for investors with lower risk tolerance. If you have a lump sum of money to invest and you put it into the market all at once, then you run the risk of buying at a peak, which can be unsettling if prices fall. The potential for this price drop is called a timing risk. That lump sum can be tossed into the market in a smaller amount with DCA, lowering the risk and effects of any single market move by spreading the investment out over time.


For example, suppose that as part of a DCA plan you invest $1,000 each month for four months. If the prices at each month's end were $45, $35, $35, $40, your average cost would be $38.75. If you had invested the whole amount at the start of the investment, your cost would have been $45 per share. In a DCA plan, you can avoid that timing risk and enjoy the low-cost benefits of this strategy by spreading out your investment cost..."


To summarize the point in a different and familiar way, we’ll remind you of the moral of the story about the tortoise and the hare:  Slow and steady wins the race.   


Thing Two


Should You Buy Critical Illness Insurance?


Life and health insurance agents will often pitch you on the idea of buying critical illness insurance by telling you about the high incidence of bankruptcies in the country attributable to medical catastrophes.  Some reporting has the number of bankruptcies with that root cause as high as 70% but that assertion has been challenged by other sources that point out that no single element can be pinpointed in many of the bankruptcy cases studied.  In any event, it may still make sense to at least consider critical a critical illness policy.  The following is taken from on the subject:


“…It's easy to think it'll never happen to you. But every week, thousands of Canadians experience a medical event that changes the course of their lives.


Critical illness insurance may provide a lump-sum payment if you are diagnosed with a serious illness that is covered in the policy. You may choose to use the benefit to:

·       Cover immediate living expenses

·       Replace lost income

·       Pay for medical treatments or other expenses related to your recovery


Critical illness insurance lets you focus on recovery instead of worrying about finances…”


The last three bullet points should figure prominently in your decision-making process. Many people who are asked about buying critical illness coverage rightly argue that their health insurance will cover them, minus the deductible and within the policy's lifetime limits, and they are right.  Their health insurance will cover their medical bills.  But it won’t cover mortgage payments or buy groceries, or pay utility bills, etc., in the event they are forced to miss work while dealing with the illness. Critical illness plans provide lump sums that can be used to cover all of that and more.  That said, they have many limitations. If you decide to buy one, make sure you understand clearly what those limitations are.



Thing Three


Just A Thought


People are illogical, unreasonable, and self-centered.Love them anyway.If you do good, people will accuse you of selfish ulterior motives.Do good anyway.If you are successful, you will win false friends and true enemies.Succeed anyway.The good you do today will be forgotten tomorrow.Do good anyway.Honesty and frankness make you vulnerable.Be honest and frank anyway.The biggest men and women with the biggest ideas can be shot down by the smallest men and women with the smallest minds.Think big anyway.People favor underdogs but follow only top dogs.Fight for a few underdogs anyway.What you spend years building may be destroyed overnight.Build anyway.People really need help but may attack you if you do help them.Help people anyway.Give the world the best you have and you'll get kicked in the teeth.Give the world the best you have anyway.” ― Kent M. Keith


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