Here are three of the week's top pieces of financial insight, gathered from around the web:
Dividend aristocrats are back
Dividend-paying stocks are a surprise winner amid this market turbulence, said Hannah Zhang in Institutional Investor. "For the year through the end of October, the Morningstar Dividend Yield Focus Index returned nearly 2 percent," compared with a decline of 19.2 percent for the broad market. Conventional wisdom holds that dividend stocks struggle in a rising-rate environment, which makes newly issued bonds more attractive. Higher rates also "make it harder for companies to pay back debt, let alone sustain healthy dividend payouts." But neither argument has held up this year. Why? One theory is that investors have flocked to "defensive stocks" — large and well-established companies that pay healthy dividends as tech stocks fall.
Wall Street's worst deal
"If you believe you lost lots of money because your financial adviser was negligent, reckless, or dishonest," you could have a case, said Jason Zwieg in The Wall Street Journal — if you're able to sue. But most often, investment advisers make prospective clients sign an agreement that automatically sends disputes to arbitration rather than court. In arbitration, "you could bankrupt yourself trying to recover the money you've already lost." Arbitrators can charge as much as $1,950 an hour, and costs must be paid up front (split 50-50 by the client). An analysis of 21,605 state-registered advisory firms found that 2.3 percent of them had at least one arbitration claim for damages of at least $2,500. Most advisers, however, are not required to disclose arbitrations in their official brochures.
A 'cash-stuffing' budget hack
Cash has found new life among young people, said Peter Coy in The New York Times. Jasmine Taylor, 31, has amassed more than 600,000 followers on TikTok (and another 280,000 on Facebook and Instagram), where she "regularly posts videos of her hands counting" her weekly income, which she requests to receive in cash. She stuffs the cash into "clear plastic envelopes in a colorful binder" and tallies everything up on paper. Her system is called "cash stuffing," and it has more adherents than you'd think, who say that the "tangibility" of cash gives them a better handle on expenses. A survey of 600 young Americans "found that 61 percent said they use some form of cash stuffing." Most, like Taylor, are not "cash purists." She uses credit cards for online purchases, but pays them off in full.
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