Vocabulary & further resources
All in one place.
At the end of each post, I suggest further resources to learn more. All those resources are consolidated here. So is the jargon we’ve introduced, with links to a definition and the post where each term was best explained. Naturally, this post will be updated each week. Everything by Money IRL is organized in The Omni-Post.
Vocabulary
Investing basics
Stocks / shares / equity - see post
Initial public offering (IPO) - see post
Bonds / fixed income - see post
Face value / par value (of a bond) - see post
Investment-grade bond - see post
High-yield / junk bond - see post
Market cap weighting - see post
Large cap / mid cap / small cap - see post
Exchange-traded fund (ETF) - see post
Ex-dividend date / ex-date - see post
Capital gains distribution - see post
Investing essentials
(Un)recoverable cost - see post
Insurance
Level term life insurance - see post
Family’s share of earnings - see post
Policy laddering (life insurance) - see post
Self-only / family plan (health insurance) - see post
High-deductible health plan (HDHP) - see post
Estate planning
Primary/contingent beneficiary - see post
Per stirpes designation - see post
Payable on death (POD) / Transfer on death (TOD) - see post
Last will and testament - see post
Joint tenants (of an account or real estate property) - see post
Tax-advantaged accounts
Qualified distribution - see post
Health savings account (HSA) - see post
Taxes
Itemized deductions - see post
Above-the-line deduction - see post
Nonrefundable credit - see post
Student loan interest deduction - see post
Mortgage interest deduction - see post
Further resources
Blogs, podcasts, YouTube
This series of short videos by Preet Banerjee slowly introduces the basic concepts of investing and assumes zero prior knowledge. I created a YouTube playlist of the videos at that link. (Two videos are skipped deliberately, partly because they contain descriptions that don't apply to modern investments in the US.)
The YouTube channel Two Cents has good videos comparing level term life insurance and whole life insurance, and on the benefits of an emergency fund.
Patrick Boyle, a London-based professor and former hedge fund manager, has a great YouTube channel with commentary on current events and important issues in financial markets. This playlist of his lectures on portfolio management is a good overview of many different aspects of investing.
The Plain Bagel is a Canadian finance YouTube channel with level-headed analysis of current events and various personal investing topics. Check out his explanation of fractional shares, and here’s another video about dividends.
Paul Rabalais is an estate planning attorney with a great YouTube channel. He has a ton of videos and livestreams covering so many aspects of estate planning. His video on avoiding probate that I linked above is an excellent summary, although it uses jargon that wasn’t introduced here. He has another video describing a probate in detail, and here are a couple videos on selecting an executor for your estate. If you want to learn more about estate planning, you could start by listening to a bunch of his videos.
The Retirement Nerds run a YouTube channel focused on Social Security, Medicare, and estate planning. Here’s a video summarizing how to plan for incapacity, and here’s a detailed interview with an attorney about the highlights of an estate plan.
More on estate planning: you can read about the different ways to hold the title of a home here. Read about TOD deeds for a home here, and about registering your vehicle with a beneficiary here.
Patrick McKenzie has a rousing guide to salary negotiation here. He’s a great follow on Twitter/X @patio11, has a podcast called Complex Systems, and writes a newsletter on the inside baseball of banking and finance called Bits about Money.
Rational Reminder and Ben Felix
The Rational Reminder podcast and Ben Felix’s YouTube channel produce some of the most thorough and accessible explanations of portfolio management, as well as other topics.
This video is an outstanding explanation of the principles of financial markets and the general approach to investing that we’ll apply. Even those with some knowledge about investing will benefit from watching.
This video explains why reducing diversification is more likely to result in underperformance than overperformance.
This video (with The Plain Bagel) explains why the success of passive investing relies on active investors.
On how to compare renting and buying a home. For quick videos, see here. For longer-form content, check out these podcast episodes.
Check out this video on the question, “What Are Normal Stock Returns?”. This is related to the contrast between the expected return of an asset and the distribution of returns that you expect.
This video explains why it often makes sense to pay off your mortgage instead of allocating a large fraction of your taxable portfolio to bonds.
The Rational Reminder interview with Jonathan Berk and Jules van Binsbergen explains a ton of ideas about dynamics between fund managers and investors.
The Rational Reminder interview with Adriana Robertson makes great points on why passive investing entails active decisions by multiple parties.
The White Coat Investor
The White Coat Investor is a tremendous resource for finance and investing, and most of the info they publish is not specific to physicians. They have many posts directed at members of the US military, because the founder was a military physician. WCI is a strong recommendation for information on several topics, including tax-advantaged accounts and life insurance. Consider signing up for one of their email newsletters. They also have a podcast.
See this overview of term life insurance, this post on policy laddering, and all these posts on permanent life insurance. You can also search by category: permanent life insurance and term life insurance.
Check out this interesting piece from The White Coat Investor on why you may not need an emergency fund, and another good post on why municipal money market fund yields are so volatile.
See this post on asset location and clear thinking on using different retirement accounts.
Ramit Sethi and I Will Teach You to be Rich
Ramit’s videos on automation are great tutorials and may help if you’re stuck on a logistical detail.
His recommendation to have a regular money meeting with your partner is a great idea.
Ramit Sethi’s podcast Money for Couples is my favorite resource on money and psychology. He works with couples who reveal all their numbers to his listeners: assets, debts, income, and spending. But these interviews are largely devoted to digging into even more intimate details: the psychological underpinnings of their struggles with personal finance. His guests are people with diverse issues: couples deep in debt (1, 2, 3, 4, 5); people with family issues (1, 2); couples with problems related to low income (1, 2, 3, 4, 5); couples who have saved millions and don’t know how to spend (1, 2, 3, 4); couples with a partner who makes questionable decisions (1, 2, 3, 4); high-earning couples who still overspend (1, 2); couples with totally different perspectives on risk (1); and couples with different life goals or enormous income disparities (1, 2, 3, 4, 5, 6, 7). I’ve learned so much from Ramit’s commentary and from observing patterns among the guests, and the lessons are universal, not only for people in relationships.
Ramit emphasizes many principles on his podcast, including these three: (1) Simplify and automate every repetitive action you can — like bill payments and investments — so that you’re effortlessly consistent with minor details. This frees your attention from drudgery so you can focus on the big picture. (2) Spend extravagantly on the things you love, and cut costs mercilessly on the things you don’t. (3) Your financial plans should be motivated by a grand vision that makes you excited for the future and ties together all the small actions and hard work. Your vision should be detailed, and it should include near-term goals — if your only goal related to spending money is to retire in some number of years, you’re artificially diminishing your own life.
Other sites
Portfolio Visualizer has a great tool to compare the total returns of different funds. They also have a tool to compare the returns of different asset classes as far back as 1972. They require a paid plan for certain features, but the free trial is generous.
Reddit has several forums (subreddits) with great discussion of financial issues as well as wikis that provide some of the best compiled information on the internet. Subreddits I’ve found useful include r/personalfinance, r/Scams, r/investing, r/Banking, r/CreditCards, r/RealEstate, and r/FirstTimeHomeBuyer. In the post on renting from a homeowning partner, I recommended the bat-infested Victorian as a reminder that homeowners can have high unexpected costs.
Policygenius has a life insurance price index that gives you a window into how age and death benefit affect premiums. Also see this brief post which explains that you save money by paying annual (rather than monthly) premiums.
Books
Why Does the Stock Market Go Up? by Brian Feroldi is a quick explainer on many common questions about the stock market.
The Ascent of Money: A Financial History of the World by Niall Ferguson is a popular-but-academic history, with a section on the Dutch East India Company in chapter 3. As we covered in the gentle intro to investing, that was the first company to issue shares to the public. The book was adapted into a documentary, but I strongly prefer the book.
For a well-researched and interesting book on the rise of index funds, check out Trillions: How a Band of Wall Street Renegades Invented the Index Fund and Changed Finance Forever by Robin Wigglesworth.
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