Phoning It In
David Powell | Nov 14, 2021
THOSE PAPER COVID-19 vaccination cards weren’t designed for heavy use. Yet many jurisdictions require proof of vaccination to enter a restaurant, theater, museum or sports event. How do we avoid wearing out the card when we’re constantly pulling it out of our purse, pocket or wallet? Simple. Provide digital proof of your vaccine status. There are some state-specific mobile apps that do this, like New York’s Excelsior Pass, as well as proprietary apps like Clear and Azova. But there wasn’t one likely winner to become a widely used system—until now. It’s called the SMART Health Card. The SMART Health Card is a verifiable health record from the CommonTrust Network, a non-profit registry of data sources that encompasses health systems, testing sites, vaccination providers and public health registries. A growing number of U.S. states, international governments and retail pharmacies—including Walmart, CVS, Rite Aid and Sam’s Club—have joined the network and become SMART Health Card issuers for vaccinations. All use SMART Health IT, an open standards program now supported in software platforms from Microsoft, Google, Apple, Amazon and others. Apple’s latest iOS 15.1 release, and Google Android 5 or later, also both use it. Here’s how two states, California and Washington State, both of which adopted SMART Health Cards, have made it easy to add proof of vaccination to your Apple wallet: Head to the state’s vaccine digital record site, which is here for California and here for Washington. Fill in your name, date of birth and cellphone number, and then choose a four-digit PIN and hit submit. The site will text you a link to its site that’s uniquely yours. Tap on the link texted to you. In the web page that opens, enter your PIN. The web page will load a QR code and more. Screenshot or print the QR code, then…
Read more » Money for Later
David Powell | Oct 26, 2020
IF A SALESPERSON had tried to get me to sink my hard-earned money into an investment that’s illiquid or issued by an insurance company, I would have shut down in a New York minute—until now. My spouse and I recently became owners of a deferred income annuity (DIA), with plans to put perhaps 15% of our savings into these products. Also known as longevity insurance, a DIA involves plunking down money today in return for regular monthly income starting at a future date. What convinced us to buy DIAs? Income hedge. We want income we can’t outlive. The DIAs will provide us with a safety net if the withdrawals from our 401(k), IRA and taxable savings fall short of what we expect or if our Social Security benefits get cut. Shrinking yields. Treasury bonds—both the conventional type and those that are indexed to inflation—are mainstay riskless assets in our portfolio. But today, they yield less than inflation. Yields on municipal and higher-quality corporate bonds are also disappointing, especially when you factor in the added risk involved. By contrast, with a DIA, we can collect handsome income, in part because the insurance company will be effectively returning part of our initial investment to us each month. Longevity risk. Some of us will live much longer than our birth year cohort. It’s impossible to know how life will go, but my spouse and I are keen to stay independent to the end. Simplicity. Our plan is to collect income from annuities and Social Security, while also taking required minimum distributions from our retirement accounts. Put these three together, and we have a simple plan for turning our savings into retirement income. That simplicity will be useful as we age. My first concern with buying an annuity was the usual—that our chosen insurer…
Read more » Staying Wealthy
David Powell | May 24, 2021
A CLOSE FRIEND'S LONG career in the motion picture business recently came to an end when the studio eliminated her job. Even before the pandemic, the industry was changing, so she wasn’t surprised or, for that matter, especially sad about getting laid off. She was lucky to receive a good severance package and is now ready to do something different. But finding the right job will likely take time, so carefully managing her cash through the transition period is crucial. That’s why alarm bells sounded when she asked me for advice about a product she’d been pitched by a wealth management vice president at her bank. “You have all this cash sitting in savings earning little,” he said. “Why not invest it with us? I designed something for you that’s liquid, conservative and pays monthly tax-exempt income.” Wow, specially designed just for my friend. How nice. Did the VP ask about her cash needs in the months ahead? Did she share her risk tolerance before he pitched this? “Nope,” she told me. “I just said I’d like to earn more on my savings.” “What if you put your cash in this investment—and it disappears when you need it most?” I asked. I wouldn’t have been so worried if the product really was low risk and liquid, with a return better than a savings account or certificate of deposit. But I couldn’t think of any investment like that today, so I was curious to read the VP’s proposal. What was this thing that he had “designed”? It turned out to be a portfolio of individual bonds and a bond fund actively managed by an outside investment advisor. The money would be held in a separately managed account, with a big chunk of the portfolio in municipal junk bonds. Thanks to its…
Read more » Making a Mesh
David Powell | May 24, 2019
THERE ARE AREAS in my life where I’ve spent too much money and time trying to be cheap. My reward: steady aggravation—until I spent a bit more to get the right solution. Which brings me to home networking technology. Most of us spend some $500 a year or more for internet broadband service. The problem: Many families are still living with old networking gear that’s slower than it should be, sometimes unreliable or provides poor wi-fi coverage in parts of their house. Networking technology can get complicated pretty fast, so internet service providers try to simplify their customers’ lives by integrating four separate networking functions into a single internet gateway device (IGD) that they give you upon installation—and for which you pay each month: Broadband modem. Usually cable or DSL, this is your main pipe to the internet. Firewall/router. This keeps unwanted internet traffic from your local network and routes traffic from your home to the internet. Ethernet switch. This connects less-common devices that use Ethernet cabling. Wi-fi access point. This provides wi-fi connectivity on your local network using either 2.4 GHz or 5 GHz channels. The integrated approach worked pretty well in the old days, when customers had just a few devices that needed internet access—and those devices weren’t constantly moving around the house, but instead could be placed near the IGD, where wi-fi signals are strong. For readers who live in a condo or a tiny house, the single IGD approach may still meet your needs, especially if your IGD is five years old or less. But if you’re living in a typical 2,400-square-foot house or bigger, one wi-fi access point may not give you usable wi-fi throughout your home. Wi-fi signal strength grows weaker with distance, and dramatically drops off when signals pass through each wall, door, ceiling…
Read more » Get Me a Margarita
David Powell | Jul 12, 2019
I HAVE LONG ADMIRED my good friend Nick for his generosity with friends—but also for his inspiring ability to pinch a penny. The man can pinch so hard he makes Lincoln cry, so I knew the world was changing fast when he installed a Ring video doorbell. Really? Pinch me. A decade ago, new technologies inspired fantasies of living in a Jetsons-style “smart home.” There was a nascent market for internet-connected products, such as the original Nest Learning Thermostat. Since then, the number of players and products has exploded. Smart assistants like Siri and Alexa also came along, further stoking growth, and sending companies scrambling to connect smart home products with assistants, so customers can control things with their voice. “Hey Rosie, get me a margarita on the rocks, no salt.” Okay, we’re not there yet. What is the state of smart home products? Some promise to save you time or money. Others offer improved home security, comfort or peace of mind when you’re out of the house. How much of it is currently worth sinking money into? In my own home, I’ve deployed a handful of the new technologies, some with good results and some mixed. Before you even consider any of this, be sure your family has a wi-fi network which reliably covers your whole home. My first project was “smart-for-dumb” device replacement. I swapped three of our seven old smoke-and-carbon-monoxide detectors for Nest Protect devices. Why not all seven at once? Smart devices are often two-to-four times the cost of “dumb” ones: $120 for Nest Protect vs. around $40 for a basic detector. I started with units in our foyer and hallways, leaving the bedrooms for later years. Installation was easy enough. I simply added the Nest units to our wi-fi network and they’ve been working reliably ever since.…
Read more » Cloudy with Scattered Bubbles
David Powell | Oct 1, 2025
Each year in Seattle, our exquisite summer weather exits stage left in September, pursued by a bear worthy of Shakespeare: pervasive gloomy clouds and steady rain persist until next July. More rain accumulates in other cities, but we have more gray, cloudy days (usually 226/year). Those many days of non-stop summer sunshine lead even the most careful to grow forgetful, leaving home without a rain shell, driving with joyous abandon on newly slick and dark roads. So it can be too, in our financial markets, after so much sunshine. We’ve lately lived through mostly sunny market prices. Except for April’s brief tariff tantrum, prices have risen, some rising even faster of late. Much ink has been spilled on the topic of market bubbles. Jonathan wrote this piece in 2021, before a big decline in both stock and bond prices during 2022 from a post-pandemic inflation spike. It’s impossible to predict the future, including highs and lows of stock prices over any period. But as Warren Buffett noted in one famous speech at Sun Valley in 1999, valuing is not the same as predicting. By several measures, U.S. stocks are expensive as of market close on Sep. 30: Warren Buffett’s metric, which divides total market cap of all U.S. stocks by current U.S. GDP is +2.43 standard deviations (SD) over its average since 1950, a new high. Schiller’s PE, aka CAPE or CAPE10, is now +2.2 SD over its average since 1950, but below its most recent high of +3.0 SD in Dec. 1999. Price/Sales metric, which tracks the ratio of the total price of the U.S. stock market versus total sales revenue from U.S. companies, is at +2.6 SD over average since 2000. S&P 500 mean reversion quantifies how far market prices are off the index’s long-term average growth rate;…
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