The Long View

Scott Burns: The Case for a Simple Retirement Plan

Nov 7, 2023

Guest Scott Burns, syndicated personal finance columnist and author, discusses couch potato investing, retirement spending, annuities as a retirement solution, and go-to resources for personal finance wisdom.

51:14

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Episode guests

Scott Burns

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Quick takeaways

Scott Burns recommends a simple two-fund portfolio of a total stock market fund and a total bond market fund, which has often outperformed more complex and diversified portfolios.

Scott Burns emphasizes the importance of mindful spending in retirement and making choices that align with personal values and priorities, rather than equating wealth with material possessions.

Deep dives

Couch Potato Investing: A Minimalist Strategy for Investing

Scott Burns, author and personal finance columnist, discusses his evolution towards couch potato investing, which involves buying and holding a diversified portfolio of low-cost index funds. He emphasizes that watching smart, articulate fund managers fail to consistently outperform the market led him to embrace this strategy. He found that the expense ratio was the only major variable that consistently predicted mutual fund performance. Scott recommends a simple two-fund portfolio, consisting of a total stock market fund and a total bond market fund. He highlights that the simpler portfolio has often outperformed more complex and diversified ones. He also addresses the fear of missing out on international stocks, but suggests that the U.S. market, with its large overseas exposure and favorable demographic trends, remains a good investment choice. Scott advises investors to choose an appropriate stock-to-bond allocation based on their risk tolerance and job security. He underscores the importance of not being intimidated by numerical precision and recommends the couch potato strategy as a simple and effective approach to investing.

Introduction

2min

The History of Computers in Investment Offices

19min

Exploring Retirement Spending and Underspending

6min

Exploring Annuities as a Retirement Solution

19min

Go-To Resources for Personal Finance Wisdom

2min

Gratitude, Subscription, and Disclaimer

2min

Our guest on the podcast today is syndicated personal finance columnist and author Scott Burns. Burns began his career as a newspaper columnist in The Boston Herald in 1977, where he was also the financial editor. In 1985, he joined the staff of The Dallas Morning News, where his column became one of the most widely read features in the paper. Along the way, he created what he called Couch Potato Investing, which involves buying and holding a broadly diversified portfolio of low-cost index mutual funds. Burns has authored or co-authored several books, including The Coming Generational Storm and Spend ‘Til the End, both of which he co-authored with Laurence Kotlikoff. He received bachelor’s degrees in humanities and biology from the Massachusetts Institute of Technology.

Background

Bio

Couch Potato Investing

The Coming Generational Storm: What You Need to Know About America’s Economic Future, by Laurence J. Kotlikoff and Scott Burns

Spend ‘Til the End: Raising Your Living Standard in Today’s Economy and When You Retire, by Laurence J. Kotlikoff and Scott Burns

Bonds and Retirement

“Do Bonds Have a Future?” by Scott Burns, scottburns.com, May 14, 2022.

“Scott Burns: These Four Pillars of Investing Stand the Test of Time,” by Scott Burns, The Dallas Morning News, July 20, 2023.

Allan Roth

“TIPS Ladder Funds Don’t Yet Exist, but They Should,” by John Rekenthaler, Morningstar.com, June 16, 2023.

“Is America Hitting Peak Consumption?” by Scott Burns, scottburns.com, Oct. 12, 2023.

“The Pudding Report, 2022,” by Scott Burns, scottburns.com, Jan. 15, 2023.