Making Money Your Biggest Investment Risk is Not the Stock Market
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Apr 6, 2026 Mo Milevsky, professor and author on pensions and retirement income theory, reframes your career as your biggest asset. He explains human capital, how job risk shifts with age, and why lifecycle investing should reflect your income profile. Practical chat on sequence-of-returns risk, diversifying household career exposure, and portfolio protections for later life.
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Pension Shift Made Careers Riskier
- The shift from defined benefit to defined contribution pensions made modern human capital more stock-like and less secure.
- Mo argues guaranteed pensions evaporated for most new labour‑force entrants, increasing career income volatility.
Actuary Couple Joke Exposes Diversification Risk
- Mo recounts an actuary couple joking they should divorce because both worked for the same insurer and were undiversified.
- The story illustrates household human capital correlation risk when spouses share industry exposure.
Invest Outside Your Job Sector
- Avoid concentrating financial investments in the same sector as your job; instead allocate to assets uncorrelated with your human capital.
- Mo's barber (zero-beta human capital) should hold broad equities, while investment bankers should favor safer financial capital.
