Sound Advice

Fixed annuities are usually among the worst investments. Fixed annuities are not inherently bad, but they are often poor investments when compared with low-cost alternatives, especially for someone who already has adequate retirement income and doesn't need an insurance guarantee. Here are the main reasons: 1. Low expected returns A fixed annuity typically provides a guaranteed interest rate, but that rate may be substantially below what you could reasonably expect from a diversified portfolio of stocks and bonds over a long retirement. The trade-off is intentional: You surrender some upside in exchange for guarantees. 2. Inflation can quietly eat away at your money Suppose an annuity earns 4% while inflation averages 3%. Your nominal balance is growing, but your purchasing power is increasing by only about 1% before taxes. For a retirement that could last 25–30 years, inflation risk matters enormously. 3. Your money can be difficult to access Fixed annuities co...

Am I better off with a local cost total market index fund or a costly wealth manager? For many investors, a low-cost total market index fund is the better choice . A costly wealth manager can be worthwhile, but only if they provide value beyond investment selection—things like tax planning, estate planning coordination, retirement-income strategy, behavioral coaching, and complex financial decision-making. The key question is not "Can a wealth manager pick better stocks?" Most cannot consistently beat a low-cost index approach after fees. The question is: "Will the advice and discipline they provide be worth the fee?" The cost difference is enormous Suppose you invest $1 million for 20 years and earn a hypothetical 7% annual return before fees: Approach Annual cost Approx. ending value Total market index fund 0.05% ~$3.84 million Wealth manager 1.00% ...

Make sure to read the small print in drug commercials The "small print" in prescription drug commercials isn't actually hidden—it's usually spoken quickly or displayed briefly during what's called the major statement of risks. The scariest parts are often rare, but they're included because the risks can be serious. Some of the most alarming warnings commonly heard include: Death: Some medications carry warnings about an increased risk of death in certain patients. For example, some antipsychotics have a boxed warning about increased mortality in elderly patients with dementia-related psychosis. Suicidal thoughts and behavior: Many antidepressants, seizure medications, and other drugs warn about an increased risk of suicidal thinking, especially in children, adolescents, and young adults. Life-threatening infections: Drugs that suppress the immune system (such as those for rheumatoid arthritis, psoria...

Here’s Why You Shouldn’t Buy a Variable Annuity? A variable annuity isn't inherently a bad product. In the right situation—typically someone who has already maxed out other tax-advantaged accounts, wants tax-deferred growth, and values guaranteed lifetime income—it can make sense. Still, many financial advisors argue that most people pay more than they receive in benefits. Here are the biggest reasons. 1. High fees eat away at returns Variable annuities often layer multiple fees: Mortality and expense charges: 1.0%–1.5% Investment management fees: 0.5%–1.5% Rider fees (income or death benefits): 0.5%–1.5% Administrative fees It's not unusual for the total annual cost to exceed 2%–3% , which can substantially reduce long-term growth compared with low-cost index funds. 2. Investment gains are taxed as ordinary income Unlike stocks held in a taxable brokerage account, where long-term gains receive preferential capital gains tax treatme...

How likely is a major stock market pullback this year? A major pullback is possible this year, but not something anyone can time with confidence . The sources I found point to a market that is still supported by strong earnings expectations and AI enthusiasm, while also looking vulnerable because valuations are rich and surprises can hit hard. How to think about the odds A 5% to 10% drawdown is fairly normal in most years, and some commentators say 2026 already looks close to that range. The bigger risk is a correction or sharper pullback if earnings disappoint, inflation reaccelerates or geopolitics and policy shocks shake confidence. At the same time, some strategists still expect the bull market to continue, which means the market is not uniformly flashing recession or crash signals. What raises the risk High valuations leave less room for error. Concentration in a few large stocks makes indexes more fragile if leadership wea...

How is the stock market doing? As of late July 2026, the answer depends on exactly how you measure it, but the numbers show a striking difference. S&P 500 (cap-weighted): about +8.5% year to date . S&P 500 Ex-Magnificent 7 Index: about +12.2% year to date (price return as of July 24, 2026). That means the S&P 500 excluding the Magnificent Seven has actually outperformed the traditional S&P 500 by roughly 3.7 percentage points so far this year. This is a notable reversal from 2023–2025, when the Magnificent Seven (Apple, Microsoft, Nvidia, Amazon, Alphabet, Meta, and Tesla) were responsible for a disproportionate share of the index's gains. In 2026: Several Magnificent Seven stocks have stumbled or corrected. Healthcare, financials, industrials, and many smaller technology and semiconductor companies have taken over market leadership. The equal-weighted S&P 500 has also outperformed the traditional ...