Don and Tom tackle the timeless topic of diversification — why it’s back in style, why it’s so hard to maintain, and why most investors (and pros) still get it wrong. They walk through how market “leadership” shifts over decades, the global vs. U.S. split, and why comparing your portfolio to the S&P 500 is often a trap. Listener questions cover ETF access at T. Rowe Price and Vanguard, whether to invest or pay down debt, and how the 5% flexible withdrawal rule works in early retirement. Plus, the guys riff on Halloween candy inflation, Social Security COLA bumps, and Don’s LitReading “Scary Story Season.”

0:04 Show open — Saturday radio edition and why repetition matters in financial education

1:03 The fashion of diversification — and why it’s “back in style”

2:27 International and small-cap value resurgence

3:15 Why investors chase past returns instead of diversifying

4:02 Gold, inflation, and recency bias — lessons from the 1980s

5:21 U.S. vs. international allocation debate: market cap vs. 50/50

6:20 The long wait for Japan’s market recovery

7:41 Practical diversification tools — AVGE, DFAW, VT

8:19 Stop comparing everything to the S&P 500

9:08 Historical proof: global portfolio vs. S&P since 1931

10:02 Caller Charlie — buying Avantis or DFA ETFs through T. Rowe Price or Vanguard

12:39 How fund custodians differ from managers

13:27 Checking portfolio exposure with Morningstar

14:42 Caller Gabe — invest or pay off debt?

16:45 When to pay off a car loan vs. mortgage

19:35 How to handle multiple mortgages and long-term plans

20:22 Social Security’s 2026 COLA bump and the “good news/bad news” of $102 more a month

22:21 Inflation realities — coffee, beef, and Halloween candy

25:02 Candy talk — shrinkflation and Don’s trick-or-treat haul

25:54 LitReading plug: “Scary Story Season” and Philip K. Dick’s The Hanging Man

27:34 Search “Don McDonald” in Apple Podcasts — chiropractor cameo included

29:05 Listener Victor (a.k.a. George) — can $4 million last 60 years with 5% withdrawals?

31:38 How the flexible withdrawal method works in practice

33:49 Retirement purpose, Monte Carlo results, and FIRE skepticism

37:41 Kindleberger quote on bubbles and envy: “There’s nothing so disturbing as to see a friend get rich.”

38:55 Kindleberger’s background and Manias, Panics, and Crashes

Learn more about your ad choices. Visit megaphone.fm/adchoices