Avoid Complexity

Don opens with a rant about Wall Street’s love of unnecessary complexity, focusing on “structured equity products” and other layered investments that promise protection but deliver lower returns at higher costs. The discussion covers the deceptive pitch, the billions invested in these products, and why a straightforward stock/bond mix is usually better. Larry Swedroe’s principles for prudent investing are highlighted, along with a reminder about diversification beyond the S&P 500—especially into international and emerging markets. Listener questions cover how to measure global exposure, medical IRA withdrawals, ETF dividend taxation, eliminating Empower as a middleman, and whether reinvesting dividends affects tax treatment (it doesn’t). The episode wraps with personal anecdotes from Don’s brokerage days, the evolution of his investing philosophy, and a few tech frustrations.

0:04 Don’s Wall Street rant on complexity and costs

1:12 Structured equity products and why they’re pitched

2:27 How they work and why fees are high

3:53 Study shows 7% annual drag vs. benchmarks

5:06 New AQR hedged/leveraged funds at 2.31% expense

7:02 Swedroe’s investing principles: peer-reviewed, low-cost, no timing

8:56 Importance of global diversification and emerging markets history

12:18 Listener Q: Measuring U.S. vs. non-U.S. exposure

13:44 Listener Q: Moving assets from Empower to Schwab

14:31 Listener Q: IRA withdrawals for medical expenses

17:36 Listener Q: ETF dividends—reinvest or not?

18:45 ETF tax advantage vs. mutual funds explained

19:17 Listener praise for Don’s principles leading to $1.7M portfolio

21:37 Don’s broker days selling high-fee products

23:30 Transition to radio and Business Radio Network

24:56 Call-in question pipeline is full for upcoming shows
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