I came across a good article in the August edition of Financial Planning regarding women and Long-Term Care.  Long-Term Care (LTC) has been an interest of mine for sometime-I wrote an article on LTC insurance for the Maryland Trooper Magazine in the summer of 2007 (http://www.chesadvisors.com/The_Golden_Years1.pdf). 

I won't get into it too much here; you can click through to the link and read what I wrote then, but what I found interesting about the Financial Planning article, and what I had not thought of before is that, women are more adversely affected by the lack of long-term care insurance than men. 

The problem is that women are often the at-home caregiver for their loved ones, be it their parents or in-laws, or spouse.  Besides being mentally and physically stressful, it can be expensive-especially if the caregiver must leave their profession or job.  The articles writer quotes a study completed by the National Center on Women and Aging that found that "family caregivers lose an average of $659,130 over a lifetime in reduced salary and retirement benefits."[1]    

Then, if that's not bad enough, once the poor lady is done caring for everyone else-she is then subjected to the need for care herself.  The article reports that "The chances the general population will need LTC is about 50%; for women it's more than 70%."  Moreover, "Seventy percent of nursing home residents are female, with an average stay of 3.7 years versus 2.2 years for men."[2]

Talk about your double jeopardy. . .

Marty

 

Warren Buffett called it  "By far the best book on investing ever written."  Benjamin Graham's, The Intelligent Investor has been in print since 1947--has been revised and updated every five years or so.  The edition I have was published in 1973 and updated by Jason Zweig in 2003.   

 

The Investor and Market Fluctuations  Chapter 8

 

 "A serious investor is not likely to believe that the day-to-day or even month-to-month fluctuations of the stock market make him richer or poorer.  But what about the longer-term and wider changes?  Here practical questions present themselves, and the psychological problems are likely to grow complicated.  A substantial rise in the market is at once a legitimate reason for satisfaction and a cause for prudent concern, but it may also bring a strong temptation toward imprudent action.  Your shares have advanced, good!  You are richer than you were, good!  But has the price risen too high, and should you think of selling?  Or should you kick yourself for not having bought more shares when the level was lower  Or-worst thought of all-should you now give way to the bull-market atmosphere, become infected with the enthusiasm, the overconfidence and the greed of the great public (of which, after all, you are a part), and make larger and dangerous commitments?  Presented thus in print, the answer to the last question is a self-evident no, but even the intelligent invest is likely to need considerable will power to keep from following the crowd.
 
It is for these reasons of human nature, even more than by calculation of financial gain or loss, that we favor some kind of mechanical method for varying the proportion of bonds to stocks in the investor's portfolio.  The chief advantage, perhaps, is that such a formula will give him something to do.  As the market advances he will from time to time make sales out of his stockholdings, putting the proceeds into bonds; as it declines he will reverse the procedure.  These activities will provide some outlet for his otherwise too-pent-up energies.  If he is the right kind of investor he will take added satisfaction from the thought that his operations are exactly opposite from those of the crowd." (Pg. 196 & 197)

 

What he's talking about here is portfolio rebalancing and how it helps to tame our animal instincts; instincts that almost requires us to do something when good or bad things happen in the market.  The rebalancing discipline releases psychological steam and keeps us from doing something really dangerous.