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Spreadsheet Rebalancing & some Personal Finance Updates

posted Sep 4, 2013, 6:50 PM by Tim Isbell   [ updated Sep 5, 2013, 4:12 PM ]
I'm continuing to build this website, over the last couple of weeks focusing on the Personal Finance section. This post announces a new webpage and some enhancements to a couple of others.

I added Rebalancing w/ a Spreadsheet to the Personal Finance > Investments > Asset Allocation Basics section. There was already a page describing how to rebalance using Quicken, but that method is limited to a rather simplistic asset allocation structure. It is not robust enough to balance the asset allocation I recommend in Asset Allocation Basics. So I put together a simple spreadsheet for the job. Just follow the link to find it, and to download it so you can use it with your own asset allocation work.

I've also recently polished and added a bit of new content in other parts of the Personal Finance section. Specifically:

Resources / Links: I added William J. Bernstein as an important author to read. I discovered him while reading Daniel Solin's blog. In about a week I read 3 Bernstein books and found them superb. For more on this, just click the link.

Asset Allocation Basics: When I first posted this webpage it included 3 ways to arrive at your asset allocation. The first way was The Easy Way. I described it in a couple of sentences before quickly moving on to the second and third ways. Reading Bernstein enlightened my understanding of The Easy Way by bringing in the aspect of drawing a distinction between "human capital" (which we have a lot of when we're 25 years old with a good education and many years ahead to earn money) and financial capital (which we don't have at 25 but by the time we hit 60 we'd better have). Bernstein likens this early human capital as a bond that pays a growing dividend over time. Great concept, so I added it to the Asset Allocation Basics page.

Glossary: I also added a new term, the Gordon Equation, in the Asset Allocation Basics page. It needed some explanation, which I added to the Glossary.  The Gordon Equation is a simple way to determine the "expected return" of a stock, or group of stocks. 

Retirement: In the background I'm working on several pages to add to the Personal Finance section. I have the next 3 queued up to publish in this month of September. To "look ahead" just check the link. Comments welcome, as always.

I trust that your investments are doing well. If you need a little more encouragement to follow the recommendations in the chart on Asset Allocation Basics, just read the Bernstein books. While I learned a lot from the books, they were also extremely affirming of this investment philosophy. If you're looking for a place to start on his writings, I started with The Ages of the Investor. It's an e-book that I think I put on my Kindle account for $4.50.

All the best,


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