Investment Risk for Dummies #retirementplan #financialadvice

Investors are understandably frustrated when they lose money or watch their portfolio values go down. As investors, we may feel helpless to influence the performance or volatility of our portfolio. We are told to focus on things like asset allocation, or to just "think long term" because markets always go up over time. It is my belief that these are excuses made by the media or sub par investment advisors who do a poor job of educating investors how to ACTUALLY think about investment risk and investment reward in a retirement portfolio. In this video I explain a 2 part framework through which to understand investment risk and how to use that framework to understand how your investment portfolio MAY perform. Enjoy "Investment Risk for Dummies".

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Eric Amzalag, CFP®, RICP®

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00:00 Introduction
01:16 How do investments make money in the simplest terms possible
02:08 Income vs Capital Gains
03:42 Interest Bearing Investments: Principal Floor
04:21 Interest Bearing Investments: Guaranteed Return of Capital
04:31 Interest Bearing Investments: Compound Interest
05:12 Interest Bearing Investments: No Control Over Rate of Return
05:34 Types of Interest Bearing Investments
07:17 Capital Gains: Buy Low Sell High
07:53 Capital Gains Tax Treatment
08:14 Capital Gains: Significant Price Fluctuation
10:25 Capital Gains: Does NOT COMPOUND
11:38 How misleading consumers about compound interest benefits big finance at your expense

Disclaimer: Please consult with your own tax, legal and financial advisors for personalized advice.

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