What the experts say

Student loan relief

Whether you’re still in college or already out makes a big difference in how you can benefit from the White House’s new plan to relieve student debt, said Linda Stern in Reuters.com. If you’ve already graduated and have a mix of government loans and private, government-backed loans, you can consolidate them and lower your interest rates beginning Jan. 1. The plan offers a 0.25 percentage point interest rate cut on those government-guaranteed private loans, and another 0.25 point cut on the entire consolidated loan “if you agree to an automated payment from your checking account.” If you are still a student or about to enroll, the benefits come later. You can have your remaining debt forgiven after 20 years and pay no more than 10 percent of your discretionary income each month toward loans—as long as you go into a low-paying profession. Unfortunately, if you have nothing but private loans, “you’re on your own.”

Green bonds aren’t so rosy

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Socially responsible investing is not easy in the $96 trillion bond market, said Elizabeth O’Brien in SmartMoney. But clever bond issuers hoping to tap the “feel-good market” are increasingly offering green bonds that appeal to environmentally conscious investors. World Bank–issued green bonds, for example, finance endeavors like “an eco-farming initiative in China or an irrigation project in Tunisia,” and yield about the same as a Treasury bond, which makes them attractive to conservative investors. But critics say green bonds are “just a marketing ploy.” It’s hard to tell which projects are funded by particular bonds in a big organization, they say, and options for selling the bonds before they mature are limited. But then, as with most investing, “if it makes people happy, then why not?”

Blinded by success

When it comes to your portfolio, your brain is wired to see the world “through rose-colored glasses,” said Jason Zweig in The Wall Street Journal. New research suggests that people have an “optimism bias,” paying more attention to better-than-expected results than to outcomes that are worse than anticipated. If you bought Apple at a double-digit price, for example, you’ve probably spent lots of time applying that positive lesson by looking for other undervalued stocks, but if you bought Net­flix at its peak, you’re probably “looking for somebody to blame” rather than engaging in self-reflection. Investors need to “force themselves to study their mistakes” if they hope to learn from them.