What the experts say

Shadowing Buffett on Big Blue

News that Warren Buffett’s Berkshire Hatha­way has invested $10.7 billion in IBM stock has many investors asking if they should follow the Oracle of Omaha’s lead, said Jack Hough in SmartMoney. IBM is “an unusual choice” for Buffett, who has famously eschewed technology companies. But he has clearly been impressed by Big Blue’s transformation from a “seller of commodity hardware into a provider of customer software and services.” The company is pursuing growth in cloud computing and is expanding in China, India, and Brazil. Before you move in yourself, though, “consider the so-called Buffett premium”—the price bump, modest so far, caused by his interest alone. If you want to mimic Buffett’s tech move at a lower price, “consider shares of Microsoft.” Buffett has vowed to stay away from that equally promising stock, “lest he raise suspicions that he received a tip” from friend Bill Gates.

The gift of college savings

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

With college tuition soaring, few gifts will be more appreciated this holiday season—or down the road—than contributions to a 529 college savings plan, said Sandra Block in USA Today. No other savings option “offers greater tax benefits.” Your earnings on investments grow tax-free, withdrawals used for college expenses aren’t taxed, and 34 states also offer state tax deductions. What’s more, “anyone—parents, grandparents, aunts, and uncles—can contribute to a child’s 529 account.” If the beneficiary skips college or gets a scholarship, the account can be transferred to another child. Many plans have also heard investors’ worries about the volatile stock market and added more-conservative investment options, like high-interest CDs and stable-value funds.

80 is the new 65

So much for relaxing in your sunset years, said Walter Hamilton in the Los Angeles Times. Nearly three quarters of Americans say they expect to work into their retirement years, according to a new Wells Fargo poll of 1,500 middle-class Americans between the ages of 25 and 75. A quarter of respondents said they would need to work until age 80 to retire comfortably. It appears that many Americans are “dangerously unprepared for retirement.” On average, those polled had saved only 7 percent of their desired retirement goal, and three in 10 people in their 60s had saved less than $25,000.