April 27, 2023

The Intelligent Investor

As a retiree, investing can be a delicate balance between maximizing returns and preserving capital. With so many investment options available, it can be difficult to know where to put your money and how to manage your portfolio effectively. However, one book that has stood the test of time and continues to provide valuable insights to retirees is "The Intelligent Investor" by Benjamin Graham. Despite being written over 70 years ago, some of the book's fundamental principles remain relevant today and can guide retirees in making wise investment decisions that can help achieve long-term financial success.

Fiat Wealth Management has studied "The Intelligent Investor" and can help you apply its wisdom to your retirement portfolio. With efficient strategies, diversification, and a focus on protecting your capital, you can take the fear out of spending in retirement. Let us show you how to make intelligent decisions that will ensure a secure future for years to come. In this blog post, we will explore how the lessons from "The Intelligent Investor" can be applied by retirees to make informed investment decisions and achieve their financial goals.

1. Tilt towards income-generating investments: One of the key principles of "The Intelligent Investor" is to focus on income-generating investments. As a retiree, this is especially important as you may be relying on your investments for income. Graham suggests companies with a history of consistent dividends and a solid financial foundation. Consider adding a mix of dividend-paying stocks to your portfolio, along with other income-generating assets like bonds.

2. Look for undervalued investments: Another key principle Graham promotes is to buy stocks that are trading at less than their intrinsic value or "value investing". Value investing allows you to pick up shares of solid companies at a discounted price, which can help increase your returns over time. Fiat Wealth Management has the knowledge and experience to help identify these opportunities and put them into action in your retirement portfolio.

3. Maintain a diversified portfolio: Diversification is one of the keys to minimizing risk in a down market. Your portfolio should include a mix of asset classes, including stocks, bonds, and other income-generating assets. This can help you weather market volatility and ensure that your portfolio is positioned for long-term success. Consider adding international stocks and bonds to your portfolio to increase diversification.

4. Minimize fees and inefficiencies: High fees and inefficiencies can eat into your returns over time. Look for low-cost investment options, such as index funds, ETFs, or individual companies. Avoid trading frequently or making emotional investment decisions, which can lead to unnecessary costs, inefficiencies, and even loss of opportunity.

5. Consider a distribution strategy: When it comes to taking distributions in retirement, it's important to have a plan in place. Consider using a systematic withdrawal plan or a fixed-income annuity to ensure that you have a steady stream of income in retirement. Work with a financial advisor to determine the best approach for your specific financial situation and goals.

6. Rebalance regularly: Rebalancing your portfolio involves periodically adjusting your investments to maintain your desired asset allocation. This can help you avoid taking on too much risk in a particular asset class or sector. Consider rebalancing your portfolio annually or semi-annually to ensure that it stays aligned with your investment goals and risk tolerance.

In conclusion, using the fundamental principles outlined in "The Intelligent Investor" can be extremely helpful for retirees looking to take distributions, navigate a down market, and minimize inefficiencies in their retirement portfolio. By focusing on income-generating investments, maintaining a diversified portfolio, rebalancing regularly, minimizing fees / inefficiencies, and considering a distribution strategy, you can build a successful retirement portfolio that maximizes income and minimizes risk over the long term.

Let Fiat Wealth Management show you how easy it is to apply Benjamin Graham’s strategies of intelligent investing in retirement. Whether you are looking for income-generating investments, need help rebalancing your portfolio  for long-term success, or simply want guidance to ensure that your retirement is as stress-free as possible, we’re here to help. Contact us today and let us show you how to take the fear out of spending your money in retirement!

This page is a publication of Fiat Wealth Management, LLC. The firm is registered as an investment adviser and only conducts business in states where it is properly registered/notice filed or is excluded from registration requirements. Registration is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability.

The information presented is believed to be current. It should not be viewed as personalized investment advice. All expressions of opinion reflect the judgment of the authors on the date of publication and may change in response to market conditions. You should consult with a professional advisor before implementing any strategies discussed. Content should not be viewed as an offer to buy or sell any of the securities mentioned or as legal or tax advice. You should always consult an attorney or tax professional regarding your specific legal or tax situation.

Explore Fiat University.

Click the below tabs to access our different financial education content, events, and more:

Every Day is Saturday

Our job begins where most advisors stop—saving money is great, but how do you spend it without risk in retirement? Welcome to Every Day is Saturday with Brad Gotto and Matt Stahl, partners and private wealth managers at Fiat Wealth Management.

In this podcast we help guide you to think about your money in a practical sense and make the boring and complex financial decisions, fun, informative and educational. Join us on this journey where Brad and Matt will explore different strategies on how to spend your money without guilt and have peace of mind knowing you are spending it the optimal way in retirement.

You’ve saved money for a lifetime. Now it’s time to spend it.

In Spending Money and Having Fun, Retirement Income Certified Professional Brad Gotto teaches you how to be smart about spending so you can stop worrying and live the life you want. Old habits are hard to break, but Brad helps you embrace the counterintuitive and build new habits to support your next chapter. You’ll learn how to:

  • Change your mindset around spending

  • Create boundaries that buy you freedom

  • Gain peace of mind with concepts that take the guesswork out of your financial requirements