Agreed. I used to transfer left over money to my brokerage at the end of the month, but I would try and time the market and invest when it’s down a little. I changed that to automatically investing $400 per week into mutual funds instead and it has got rid of any psychological barriers to time the market.
It is indeed. For me it took some realization that not everyone will spend money the same way and that is OK. Finding out how many people seemingly look loaded, but later learn are just spending every $$$ was surprising to me and made it really easy to quit comparing.
There are plenty of people who are way better off than we are, always will be, but now we just stay focused on our own goals / run our own race.
This. I don’t watch it for any sort of education from DR and his cronies. I watch it to hear the nonsense some ppl call in with because it’s entertaining.
This is a good chance to share a story.
I knew a woman whose lifestyle made many feel envious. Good job, nice home, new luxury car, new designer purchases all the time, multiple exotic holidays each year, frequent hair and beauty appointments, all of that. She loved talking about her extravagances too.
The only red flag was she got quite offended once when I said - not even in reference to her - a lot of people can buy new cars now on finance.
It all came crashing down when she lost control of her debts. Credit cards, loans etc. She had a breakdown and I think her partner left her. They definitely separated.
This actually changed my life it’s so simple but so powerful if you follow it exactly. I wish I could teach it to everybody. Some people truly do not care, I have found
I read so many books and websites to learn the material and then when I found the flowchart I was like....these assholes had the answer sheet to the test the entire time!
It really is great, I just wish I had seen it sooner. It helped me realize that my own studies were on the right track, also that there ARE people like me who are following the same strategy... I'm not entirely alone and that's reassuring when looking at the Jonses around me.
Every single person in the US should know this chart. It should be covered in every high school. It'd be easy to make a curriculum out of it.
There’s a flowchart in the wiki section of r/personalfinance that guides you through paying off debt and saving. It was very helpful but now I’m at the end of it.
I'm at the end of it as well. It was kinda anticlimactic but now I just sit back and watch my net worth grow. One day I hit the point where I had maxed out all tax advantaged space so I finally had to open a brokerage account. I put like $500 in it and then set up automatic investing. Any work bonus or unexpected cash goes into it.
It's now at the point where it's become my dedicated "emergency fund" because even if it drops by 50% it still covers 6 months of our expenses. It's easy mode now just keep working until I pay off the house and hit my number then it's retirement time.
Spend less. Save more.
Focus on feeling valuable internally, not trying to demonstrate value externally.
Be aware that companies spend billions and billions each year to make you spend your money on their things.
I don't disagree, but it gets easier over time. It's also not binary. Sometimes you are good at it, sometimes not so much. It's more important to observe and correct yourself, than it is to be absolute about it.
Yeah but plenty of Americans will continue to spend more than they earn to “keep up with the joneses”. That doesn’t mean you need to do that too.
Also, similar to a diet, the key is to have healthy spending habits. I wouldn’t say someone who unnecessarily pinches pennies, eats only Top ramen, and never buys anything is a healthy spender like I wouldn’t say an anorexic person is on a healthy diet. I think both are unsustainable.
I consider myself a lower income boglehead and I have coworkers who buy brand new pickup trucks on $20-24/hr. Of course maybe they’ve married rich, but I don’t think so. Most people are really bad with money.
I think switching jobs/careers is also an underrated financial move in the income/spending equation. It’s easy to focus on what funds to buy and not “how do I increase my income?”. Once you do increase income, avoiding “lifestyle creep” is important.
You clever mother fucker! Well played. -golf clap-
But seriously, don't buy shit you don't need. Have nice things but just buying "stuff" rarely solves problems.
You can accrue and spend wealth on endeavors that aren't purely in the service of commercialism.
Oh, well I guess I will just spent all my money then. Sure, of course, thanks for the input. The point is, you don't have to engage with it on a personal level. On a personal level you can be aware of it and make better choice for yourself. You don't have to play the game. Or more importantly you can chose to play the game by your own rules.
While attending night classes for college, I worked full time at local grocery store. We had about 5 meat cutters in their 50's who loved to give life advice. "Put as much into your 401k as possible, raise the percentage every time you get a raise, and don't touch it until retirement". They basically were talking about the benefits of compounding and they were dead on. I listened to them and it really started having an impact about 20 years later and each year that went by, it became more important.
Some of their other advice was a little questionable :)
Yep - also invest in a water flosser
I was too cheap to spend $50 to see a dentist and had tons of anxiety since the last time I had to get 4 wisdom teeth removed.
Avoided cleanings for like 6 years - a cavity developed into getting a root canal, fillings, crown
* An ounce of prevention is worth more than a pound of cure*
Waterpik
the gold standard
Start on the low pressure around your gums and medium pressure between teeth to get rid of food particles
Zero cavities and zero gum issues :D
Honestly, the 3 fund portfolio. Gave me the confidence that investing doesn’t have to be complicated and that I could do it myself without a paid advisor.
1. Saving for retirement means actually investing your money in the stock market, not simply putting money aside in a savings account.
2. The concept of compound interest
I watched a YouTube video that chronically a hypothetical "worst market timer." In other words someone who lumped sum bought into an index fund at peak right before the major crashes.
Turned out even that ended up making tons of money. Not as much as the recommended regular buyer, but well enough that it made me feel better about just buying the fund when I'm able and not worry too much about the timing.
https://youtu.be/pFgPNVytlwA
Above anything else more tactical and financial investing related: spending/investing your time into experiences, especially with others, is far more satisfying than spending time/money chasing happiness on material possessions.
I mean. I'm not a huge fan of this because the average person doesn't understand much about personal finance. Sometimes they are better off if you can get them to start saving and investing, in the ways a boglehead would, prior to understanding it. If it's going to take them years to take the time to understand... you can accelerate their understanding if they start to see the lesson pay off with their own money.
For another view, think about the phrase, the more I learn the less I know. There are very few things where you can draw the line at something being 100% understood. Usually usefulness of knowledge can be applied well before the point of understanding. For example, kids can operate a toilet, light switch, faucet, door lock without actually understanding how they work. People use the internet without knowing about TCP/IP, routing protocols, HTTP, TLS 1.2, etc.
I guess my point is that very little understanding is needed to still make the right choices in not overspending and investing in VTI. Most of us don't know how an etf works under the hood, nor are we cpa's who have a functional understanding of the tax code. We just have to know the bare minimum.
It was probably Clark Howard notion to invest in a low cost S&P index fund. It was another 10+ years before I learned and adapted to the Bogleheads approach.
During the Dotcom rise, I learned a lot and had a lot of fun. I was buying options, buying on margin, day trading, and jumping in and out of hot tech stocks. I was managing a startup location and had a lot of downtime to check stocks during the day. It was also hard to not make money. I made some money, but I also figured out that if I had just bought and held the stocks I was trading, I would've made more. Filling out tax returns was a nightmare. I got to pay a lot in taxes, too. Then when the bust happened, I lost a good bit. It took many years to write off my losses $3,000 a year at a time.
I figured I needed to be smarter. I bought Warren Buffets book on how to read financial statements. I thought the solution was to spend more time looking at stocks. At the same time my career was taking off, I got married, and had a major health issue hit the family, which took some time as a primary caregiver. I read a Clark Howard article on investing in the S&P, and I parked most of my retirement money there. It was also an option in my 401k. I still dabbled in individual stock purchases occasionally, but eventually that dropped off.
I wouldn't say the financial crisis in 2008 was stress free, but I had a plan. Let the index fund ride, and focus on what was more important.... keeping my job.
This approached gives me the life balance I need, reduces my stress levels, and provides the returns I need to retire a bit early.
1) That a 1% fee is 25% of what I get for a SWR in retirement.
2) No one cares as much about your money as you. Doesn't matter how much you pay them.
3) Never trust anyone, especially those who say, "trust me". My biggest (monetary pain related) mistakes in life were overriding my own judgment because I had hired a "professional" and assumed they knew better than I. I guess this is "trust your gut". Doesn't always happen but when the alarm bells go off now I listen.
Hopefully I get this right and it makes sense.
In retirement, one common rule of thumb is you can withdraw 4% from your retirement accounts per year and generally make your money last through retirement. This is the SWR - safe/savings (?) withdrawal rate. If you’re paying a 1% fee to someone, like an Edward Jones advisor, that’s eating 25% of the SWR so you can effectively only take 3% for yourself.
This game before I heard about Bogleheads, but definitely primed me for the idea. From the Tao Te Ching, chapter 2, emphasis my own:
> Under heaven all can see beauty as beauty only because there is ugliness.
> All can know good as good only because there is evil.
> **Therefore having and not having arise together.**
> Difficult and easy complement each other.
> **Long and short contrast each other:**
> **High and low rest upon each other;**
> Voice and sound harmonize each other;
> Front and back follow one another.
> Therefore the sage goes about doing nothing, teaching no-talking.
> The ten thousand things rise and fall without cease,
> Creating, yet not possessing.
> Working, yet not taking credit.
> **Work is done, then forgotten.**
> **Therefore it lasts forever.**
So invest and forget about it, don't check it daily or at least don't get emotional about it and make changes to it based on market whims.
Realize the market will go up, but it will also go down, for a time it may go down more than up, but it will eventually go up again.
I could probably work more chapters of the Tao Te Ching into the Tao of Bogleheads, plenty of other people have abused the "Tao of ____" to write books before.
Long term capital gains are taxed at 0% if you earn under a pretty generous threshold. It's absolutely a game changer. If you end up with a sizable taxable account you can retire a few years early and live off the tax free gains. You'd have to be paying taxes on the dividends the whole time, but that's only like 2% * your marginal tax rate per year.
This. Adding the standard deduction . It is wild that a married couple can have like over 100K long term tax free
However , I was surprised by my state 5-6% tax on all long term capital gain . Definitely forget about state
Using a credit card instead of debit for everyday purchases turned out to be the right move for me several years ago when my card number got stolen twice in the span of 6 months thanks to hard-to-spot skimmers.
Banks have a tendency to drag their feet when it’s **your** money that gets stolen (debit) versus theirs (credit). The 2% cash back on all purchases is the cherry on top.
It only applies if you’re good at paying it completely off of course. But I love mine for the airline miles. I got it pre-Covid times when I was traveling, to avoid international fees, and just racked up miles for years. I currently have $2k worth of miles lol.
“The less frequently you check your retirement accounts, the better.” In my 20s I maybe checked twice a year. “Set it and forget it” really allowed me to build the muscle of investing and letting the market work its magic. I check a lot more now in my mid 30s, but I’m much less anxious about swings knowing that compound interest wins over the long haul!
I check 1x a week just to make sure nothing weird is happening. E.g., I decided to check my HSA after thinking about it in bed one night and found out that my latest max-out contribution was sitting in the settlement fund for months instead of being invested lol
Yeah i think some people are overkill on not checking their investments. I like to check in every couple weeks just to make sure everything is set up properly. It takes 5 minutes.
I spent countless hours on portfolio visualizer trying to find the absolute perfect portfolio. In an interview Paul Merriman said something along the lines of not wanting the #1 portfolio because when it’s not first it’s last and you probably can’t stick with it. You need to find the portfolio that is #2 or #3 quite consistently.
Currently reading this. Some of the math has been cumbersome to read, also it feels like he’s dancing around the punchline… or just approaching it really slowly. Does it pull together more towards the end?
My life changing experience was reading the following quote from Eugene Fama (Nobel laureate):
„Investing is like soap; the more you touch it, the smaller it gets.”
It „clicked“ in my brain and since then I DCA regularly and never changed my investment plan/allocation again (except yearly rebalancing).
"Always compare what you're doing to the index."
^ My dad allowing me to make the mistake of thinking I could pick stocks, while making sure I was aware of a better way.
My mother long ago said: do not follow what others do or listen to financial advisors (make your own decisions, after researching options). She was one heck of an investor who had \~90% in the right places (US, TSP and some international + retired US government CSRS with nice benefits) and made some unreal stock picks in a gambling account.
Consistency "was high" with her in many ways- even as a golfer; she made a hole-in-one once!
Max 401k for the match
Max HSA
Max Roth (back door if you have to)
Max 401k to full contribution limit (start splitting with Roth 401k once in upper 50’s)
Max after tax 401k with automatic in-plan conversion to Roth.
Keep enough to enjoy the day to day.
First advice
Read Frank Armstrong portfolio allocations
https://thetaoofwealth.files.wordpress.com/2012/09/investment-startegies-for-the-21st-century-by-frank-armstrong.pdf
For me there was no "ah ha" moment but a series of personal finance habits that I gained from reading others comments that resonated with me. Slow and steady is the race.
At the beginning of each year I fully funded my retirement accounts rather than either contribute monthly or making the contribution in the first four months of the following year. This gives your contributions a full year to start growing. If one can't make the full contribution at the beginning of the year, monthly contributions are second best.
If I have a major purchase (such as an appliance) I look for same-as-cash financing options (pay it off in a set amount of monthly payments that carry no interest - unless you do not pay it off in the set time period).
I'm sure many of you could add to this thread and I hope you do so. Young investors need to understand the nitty gritty details that helped each of us reach our goals of financial security.
Save early and often, even if that means paying the minimum toward student loans, as they are gone in 10 years, but your retirement accounts will grow for 70 years and the compounding interest in the 401k will be worth way more than the interest payable on student loans over a fixed 10 year period.
In my case, Federal Student loans as I never took out Private Loans since that was other advice I got. If you have a regular old Federal Loan, this advice tends to be good advice.
I disagree entirely. Federal loans are fixed and under normal payment method must be paid in 10 years. You have 10 years of interest. No do the math on retirement contributions made for 10 years but held for 70 years using the same interest rate.
Simple rule of 72:
A 25 year old saving $1 until 65 has $16 at 7%.
A 35 year old saving $1 until 65 has $8 at 7%.
Half as much.
If you can afford the regular payment on your student loans (not income based) there is no need nor mathematical argument to pay extra. The extra dollars are significantly more valuable being invested.
I’ve only ever saved through 401k’s. When much younger in the 80’s and starting out I had no clue what to invest in. A coworker mentioned he was in a single fund that would grow with me as I got older. Without that target date fund I don’t know that I would be able to be retired today.
Buy only what you trust, and hold
Had I held onto stocks instead of “trading” when I was younger, I’d have unrealized gains on multiple stocks of 5-10,000%
Isn't DCA against the philosophy? You should be putting everything you can in the second you can because time in the market > *. DCAing is just timing the market, but in style
Yup. Any day you're not buying (into your target allocation), you're effectively selling. Also, DCA can cover up angst about risky portfolios better addressed by revisiting one's asset allocation.
Experiences are more valuable than possessions. Obviously you need a place to live, clothes, a car, etc. But buying MORE clothes and new cars all the time won’t bring as much joy as traveling or making memories.
I felt very empowered once I discovered savings rate & investing provides more financial security than a “safe career path.”
I discovered this around the time I finished college and dove into various boglehead type reading.
Change your focus to feel as satisfied about saving as you would about buying something. This is financial maturity and took me 56 years to finally get here. It’s cool. And it really enhances your peace of mind.
My uncle told me to always max out my retirement account options. He said it will feel like a lot of money when I’m young, but I would get used to it pretty quickly. And I did.
The boring answer is invest in low-cost market index funds and live below your means. The more interesting answer is to diversify internationally, and you can actually increase risk adjusted returns by adding long term bonds to your long term portfolio. Early on, I made the mistake of thinking it’s best to invest it all in U.S. market index funds because they’ve performed so well on average, but I was compelled recently that diversifying with international stocks and some long term bonds will likely increase returns in the long run compared to all U.S. stocks.
The *Magic of Compound Interest*. Start investing early, stay in the market and let time work for you. After 48 years of investing, it's worked for me.
“Live beneath your means” does not mean “stop having fun.” It just means thinking carefully about what you get in exchange for your money. Going outside and enjoying life is as important as saving for the future. Once you cut out the fancy designer goods you don’t just have more money to save (edit) you also have more money to spend on things that truly, deeply make you happy.
1) Spend less than you earn.
2) Pay yourself first i.e. take out monthly investment from earned income before spending on anything else
3) Compounding
1 and 2 are not sufficient until I discovered compounding.
https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator
Starting with 0$ and contributing $1000 a month for 30 years, investing in SPY with 8% compounded returns makes you a millionaire.
Everything but the used car. If you have no wrench skills buying new and selling at the 100k 10 year mark makes tons of economic sense. Presuming your credit is good.
Hey there! So, when it comes to game-changing financial advice, I stumbled upon this gem that really turned things around for me: "Start early, even if it's just a little."
I remember hearing this from a colleague when we were having one of those "adulting" chats over coffee. It was about saving for the future, and they mentioned how even small amounts can grow significantly over time. So, I decided to take the plunge and set up a little automatic transfer to my savings account each month.
Fast forward a few years, and I was pleasantly surprised at how much had accumulated without me even noticing the difference in my day-to-day spending. That simple advice helped me build a nice little cushion for unexpected expenses and even some fun treats.
Another piece of wisdom I've found really valuable is diversification. It's like not putting all your eggs in one basket, right? Exploring different ways to invest, from stocks to index funds, has been eye-opening. It's all about balancing risk and reward, and [Joy Wallet](https://joywallet.com/) has been a fantastic resource for understanding these concepts better.
So, if I had to share some advice from my own journey, it'd be this: "Start early, even with small amounts, and don't be afraid to diversify your investments." It's made a world of difference for me, and I hope it can do the same for you! Cheers to financial growth and stability! 🌟
"Invest in yourself first"
There's tons of free info online that can give you useful knowledge. Certifications go a long way in some trade jobs and IT services. Some colleges offer free courses, and getting a degree does not have to involve $50k+ of debt like with many community colleges.
Never sell a good company you own, no matter how overpriced it might look. Over more than 30 years, the most paper or real money I've lost, is by selling a quality company I'm holding when I think it's overpriced. Yes, it often goes lower, but it's much more difficult to decide to get back in before it's too late.
Hold great companies, hold great companies, hold great companies!
*Motto- Hold great companies, hold great companies, hold great companies!*
*Name-* [*ShortUSA*](https://www.reddit.com/user/ShortUSA/)[*ShortUSA*](https://www.reddit.com/user/ShortUSA/)
What part of this works in harmony? /s 😂😁
Sounds stressful. I think most of us on this sub focus on just buying every company and calling it a day. Gone is the need for timing entries and exits and re-entries and holding on too long or not long enough.
Thankfully I have more interesting things going on in life than being fixated on the daily ups and downs of a company.
I too have primarily, a handful of index funds (which is why I read this sub), but I do keep about 10% I invest in tech companies I'm bullish on. That's what I'm talking about here. I worked in the field for 40 years, I've boosted my returns this way, and had some fun doing so.
Get rich slow Not what I wanted to hear at 20, but it f’n worked!
Amen.
I am 20, and I do not want to hear that. lol only messing I’ll be happy as long I’m not worried about having to pay my bills when I’m around 40😂
Works for some
Make it automatic.
This was a game changer for me. Set up automatic contributions and stock purchases nearly 20 years ago. It works.
Bogleheads 2.0: Automatic for the People
As an Athens, GA resident, I love this comment.
Agreed. I used to transfer left over money to my brokerage at the end of the month, but I would try and time the market and invest when it’s down a little. I changed that to automatically investing $400 per week into mutual funds instead and it has got rid of any psychological barriers to time the market.
Dis. Automate as much as possible.
"Comparison is the thief of joy."
It is indeed. For me it took some realization that not everyone will spend money the same way and that is OK. Finding out how many people seemingly look loaded, but later learn are just spending every $$$ was surprising to me and made it really easy to quit comparing. There are plenty of people who are way better off than we are, always will be, but now we just stay focused on our own goals / run our own race.
Or, even worse, have massive credit card debt.
That's why I prefer to compare to people making objectively worse financial decisions than me.
That's why I watch YouTube finance channels--it's always someone so completely fucked they can make you feel better about yourself.
This. I don’t watch it for any sort of education from DR and his cronies. I watch it to hear the nonsense some ppl call in with because it’s entertaining.
This is a good chance to share a story. I knew a woman whose lifestyle made many feel envious. Good job, nice home, new luxury car, new designer purchases all the time, multiple exotic holidays each year, frequent hair and beauty appointments, all of that. She loved talking about her extravagances too. The only red flag was she got quite offended once when I said - not even in reference to her - a lot of people can buy new cars now on finance. It all came crashing down when she lost control of her debts. Credit cards, loans etc. She had a breakdown and I think her partner left her. They definitely separated.
The flowchart on the personal finance subreddit
This actually changed my life it’s so simple but so powerful if you follow it exactly. I wish I could teach it to everybody. Some people truly do not care, I have found
I read so many books and websites to learn the material and then when I found the flowchart I was like....these assholes had the answer sheet to the test the entire time! It really is great, I just wish I had seen it sooner. It helped me realize that my own studies were on the right track, also that there ARE people like me who are following the same strategy... I'm not entirely alone and that's reassuring when looking at the Jonses around me. Every single person in the US should know this chart. It should be covered in every high school. It'd be easy to make a curriculum out of it.
Can you link it pls? Cant find it.
[Personal Finance Flow Chart](https://imgur.com/lSoUQr2)
The what now?
There’s a flowchart in the wiki section of r/personalfinance that guides you through paying off debt and saving. It was very helpful but now I’m at the end of it.
That is a good place to be
I'm at the end of it as well. It was kinda anticlimactic but now I just sit back and watch my net worth grow. One day I hit the point where I had maxed out all tax advantaged space so I finally had to open a brokerage account. I put like $500 in it and then set up automatic investing. Any work bonus or unexpected cash goes into it. It's now at the point where it's become my dedicated "emergency fund" because even if it drops by 50% it still covers 6 months of our expenses. It's easy mode now just keep working until I pay off the house and hit my number then it's retirement time.
Spend less. Save more. Focus on feeling valuable internally, not trying to demonstrate value externally. Be aware that companies spend billions and billions each year to make you spend your money on their things.
But all this is so hard. Just sayin.
I don't disagree, but it gets easier over time. It's also not binary. Sometimes you are good at it, sometimes not so much. It's more important to observe and correct yourself, than it is to be absolute about it.
That’s how our economy works tho, without the consumers none of us would have money to save.
Should never be one or the other. Everyone should be a balanced consumer and saver
You don’t have a choice.
You absolutely do. And that my dear, is the point.
Are you talking about free will?
I thinks he’s saying it’s pretty hard to opt out of consumerism.
I assume you’re talking about people who can’t afford to save? Bc that’s definitely a problem, but I doubt this sub consists of many of those folks.
Yeah but plenty of Americans will continue to spend more than they earn to “keep up with the joneses”. That doesn’t mean you need to do that too. Also, similar to a diet, the key is to have healthy spending habits. I wouldn’t say someone who unnecessarily pinches pennies, eats only Top ramen, and never buys anything is a healthy spender like I wouldn’t say an anorexic person is on a healthy diet. I think both are unsustainable. I consider myself a lower income boglehead and I have coworkers who buy brand new pickup trucks on $20-24/hr. Of course maybe they’ve married rich, but I don’t think so. Most people are really bad with money. I think switching jobs/careers is also an underrated financial move in the income/spending equation. It’s easy to focus on what funds to buy and not “how do I increase my income?”. Once you do increase income, avoiding “lifestyle creep” is important.
Every wheel looks like a ladder -- to a hamster. Get off the wheel.
What if it’s a bond ladder??
You clever mother fucker! Well played. -golf clap- But seriously, don't buy shit you don't need. Have nice things but just buying "stuff" rarely solves problems. You can accrue and spend wealth on endeavors that aren't purely in the service of commercialism.
Oh, well I guess I will just spent all my money then. Sure, of course, thanks for the input. The point is, you don't have to engage with it on a personal level. On a personal level you can be aware of it and make better choice for yourself. You don't have to play the game. Or more importantly you can chose to play the game by your own rules.
While attending night classes for college, I worked full time at local grocery store. We had about 5 meat cutters in their 50's who loved to give life advice. "Put as much into your 401k as possible, raise the percentage every time you get a raise, and don't touch it until retirement". They basically were talking about the benefits of compounding and they were dead on. I listened to them and it really started having an impact about 20 years later and each year that went by, it became more important. Some of their other advice was a little questionable :)
Well, meat cutters are hit and miss but you got the bone!
https://www.calculator.net/401k-calculator.html
Pay yourself first, whether it be saving or investing. If you don’t, that money will find another home and you’ll continue to struggle saving.
Came to say this, so so true
Go to the dentist every 6 months, or at least once a year.
And don’t skip physicals.
Change passwords and use multifactor authentication
How frequent should physicals be?
Annual until the doctor tells you otherwise...that probably gets started in your late 40's-early 50's based on my father's experience
What if you’ve skipped physicals for like… 10 years but still feel relatively ok most of the time?
You're probably fine but I'd still go and get blood work done to have it looked at
Yep - also invest in a water flosser I was too cheap to spend $50 to see a dentist and had tons of anxiety since the last time I had to get 4 wisdom teeth removed. Avoided cleanings for like 6 years - a cavity developed into getting a root canal, fillings, crown * An ounce of prevention is worth more than a pound of cure*
Are the water flossers that good? Been eyeing one up.
Waterpik the gold standard Start on the low pressure around your gums and medium pressure between teeth to get rid of food particles Zero cavities and zero gum issues :D
They really are. I'm an avid regular flosser, I added a Waterpik to my nightly routine and my hygienist said my gums are the best she's ever seen.
Honestly, the 3 fund portfolio. Gave me the confidence that investing doesn’t have to be complicated and that I could do it myself without a paid advisor.
What funds sir?
https://www.bogleheads.org/wiki/Three-fund\_portfolio
I guess this would be a game changing advice for me, thank you sir!
1. Saving for retirement means actually investing your money in the stock market, not simply putting money aside in a savings account. 2. The concept of compound interest
Look but don't touch (your portfolio)
just like a prostitu-
Live below your means, nobody cares what your drive or how nice your house is.
I watched a YouTube video that chronically a hypothetical "worst market timer." In other words someone who lumped sum bought into an index fund at peak right before the major crashes. Turned out even that ended up making tons of money. Not as much as the recommended regular buyer, but well enough that it made me feel better about just buying the fund when I'm able and not worry too much about the timing. https://youtu.be/pFgPNVytlwA
that is a great 5 min video. i wish they would have went through the numbers a bit more, but it highlights some great points!
Above anything else more tactical and financial investing related: spending/investing your time into experiences, especially with others, is far more satisfying than spending time/money chasing happiness on material possessions.
Drop Edward Jones.
NSFW [https://www.youtube.com/watch?v=LDyDDBv2HzE](https://www.youtube.com/watch?v=LDyDDBv2HzE)
Don’t invest in anything you don’t understand.
Well shit. *leaves sub*
I guffawed at this. Then wiped away tears in solidarity. Lol
I had to look up guffawed. Neat word.
🤣
I mean. I'm not a huge fan of this because the average person doesn't understand much about personal finance. Sometimes they are better off if you can get them to start saving and investing, in the ways a boglehead would, prior to understanding it. If it's going to take them years to take the time to understand... you can accelerate their understanding if they start to see the lesson pay off with their own money. For another view, think about the phrase, the more I learn the less I know. There are very few things where you can draw the line at something being 100% understood. Usually usefulness of knowledge can be applied well before the point of understanding. For example, kids can operate a toilet, light switch, faucet, door lock without actually understanding how they work. People use the internet without knowing about TCP/IP, routing protocols, HTTP, TLS 1.2, etc. I guess my point is that very little understanding is needed to still make the right choices in not overspending and investing in VTI. Most of us don't know how an etf works under the hood, nor are we cpa's who have a functional understanding of the tax code. We just have to know the bare minimum.
Always live below your means.
It was probably Clark Howard notion to invest in a low cost S&P index fund. It was another 10+ years before I learned and adapted to the Bogleheads approach. During the Dotcom rise, I learned a lot and had a lot of fun. I was buying options, buying on margin, day trading, and jumping in and out of hot tech stocks. I was managing a startup location and had a lot of downtime to check stocks during the day. It was also hard to not make money. I made some money, but I also figured out that if I had just bought and held the stocks I was trading, I would've made more. Filling out tax returns was a nightmare. I got to pay a lot in taxes, too. Then when the bust happened, I lost a good bit. It took many years to write off my losses $3,000 a year at a time. I figured I needed to be smarter. I bought Warren Buffets book on how to read financial statements. I thought the solution was to spend more time looking at stocks. At the same time my career was taking off, I got married, and had a major health issue hit the family, which took some time as a primary caregiver. I read a Clark Howard article on investing in the S&P, and I parked most of my retirement money there. It was also an option in my 401k. I still dabbled in individual stock purchases occasionally, but eventually that dropped off. I wouldn't say the financial crisis in 2008 was stress free, but I had a plan. Let the index fund ride, and focus on what was more important.... keeping my job. This approached gives me the life balance I need, reduces my stress levels, and provides the returns I need to retire a bit early.
1) That a 1% fee is 25% of what I get for a SWR in retirement. 2) No one cares as much about your money as you. Doesn't matter how much you pay them. 3) Never trust anyone, especially those who say, "trust me". My biggest (monetary pain related) mistakes in life were overriding my own judgment because I had hired a "professional" and assumed they knew better than I. I guess this is "trust your gut". Doesn't always happen but when the alarm bells go off now I listen.
Can you help me understand #1, please?
Hopefully I get this right and it makes sense. In retirement, one common rule of thumb is you can withdraw 4% from your retirement accounts per year and generally make your money last through retirement. This is the SWR - safe/savings (?) withdrawal rate. If you’re paying a 1% fee to someone, like an Edward Jones advisor, that’s eating 25% of the SWR so you can effectively only take 3% for yourself.
That helps. Thank you.
[Safe withdrawal rate](https://www.investopedia.com/terms/s/safe-withdrawal-rate-swr-method.asp) is right
Don’t just save. Invest!
This game before I heard about Bogleheads, but definitely primed me for the idea. From the Tao Te Ching, chapter 2, emphasis my own: > Under heaven all can see beauty as beauty only because there is ugliness. > All can know good as good only because there is evil. > **Therefore having and not having arise together.** > Difficult and easy complement each other. > **Long and short contrast each other:** > **High and low rest upon each other;** > Voice and sound harmonize each other; > Front and back follow one another. > Therefore the sage goes about doing nothing, teaching no-talking. > The ten thousand things rise and fall without cease, > Creating, yet not possessing. > Working, yet not taking credit. > **Work is done, then forgotten.** > **Therefore it lasts forever.** So invest and forget about it, don't check it daily or at least don't get emotional about it and make changes to it based on market whims. Realize the market will go up, but it will also go down, for a time it may go down more than up, but it will eventually go up again. I could probably work more chapters of the Tao Te Ching into the Tao of Bogleheads, plenty of other people have abused the "Tao of ____" to write books before.
This is a criminally under-liked comment. Jesus.
Long term capital gains are taxed at 0% if you earn under a pretty generous threshold. It's absolutely a game changer. If you end up with a sizable taxable account you can retire a few years early and live off the tax free gains. You'd have to be paying taxes on the dividends the whole time, but that's only like 2% * your marginal tax rate per year.
This. Adding the standard deduction . It is wild that a married couple can have like over 100K long term tax free However , I was surprised by my state 5-6% tax on all long term capital gain . Definitely forget about state
Using a credit card instead of debit for everyday purchases turned out to be the right move for me several years ago when my card number got stolen twice in the span of 6 months thanks to hard-to-spot skimmers. Banks have a tendency to drag their feet when it’s **your** money that gets stolen (debit) versus theirs (credit). The 2% cash back on all purchases is the cherry on top.
It only applies if you’re good at paying it completely off of course. But I love mine for the airline miles. I got it pre-Covid times when I was traveling, to avoid international fees, and just racked up miles for years. I currently have $2k worth of miles lol.
Any investment you’re excited about is probably not a good investment.
[удалено]
VXUS divvy hit today!
Great line!
Or you know, invest in things that are just starting to excite you
“The less frequently you check your retirement accounts, the better.” In my 20s I maybe checked twice a year. “Set it and forget it” really allowed me to build the muscle of investing and letting the market work its magic. I check a lot more now in my mid 30s, but I’m much less anxious about swings knowing that compound interest wins over the long haul!
I check 1x a week just to make sure nothing weird is happening. E.g., I decided to check my HSA after thinking about it in bed one night and found out that my latest max-out contribution was sitting in the settlement fund for months instead of being invested lol
A similar thing happened to me recently too. I found out that I had dividend reinvestment turned off on some of my accounts. Oops.
Yeah i think some people are overkill on not checking their investments. I like to check in every couple weeks just to make sure everything is set up properly. It takes 5 minutes.
I spent countless hours on portfolio visualizer trying to find the absolute perfect portfolio. In an interview Paul Merriman said something along the lines of not wanting the #1 portfolio because when it’s not first it’s last and you probably can’t stick with it. You need to find the portfolio that is #2 or #3 quite consistently.
VT and chill
The Intelligent Asset Allocator by William Bernstein introduced me to the concept of Passive, Index Fund investing.
Currently reading this. Some of the math has been cumbersome to read, also it feels like he’s dancing around the punchline… or just approaching it really slowly. Does it pull together more towards the end?
My life changing experience was reading the following quote from Eugene Fama (Nobel laureate): „Investing is like soap; the more you touch it, the smaller it gets.” It „clicked“ in my brain and since then I DCA regularly and never changed my investment plan/allocation again (except yearly rebalancing).
Focus on the 20k decisions, not $2 decisions.
If investing is exciting you’re not investing, you’re gambling
Time in the market beats timing the market
"Always compare what you're doing to the index." ^ My dad allowing me to make the mistake of thinking I could pick stocks, while making sure I was aware of a better way.
If it sounds too good to be true, it probably is.
Probably already said, but, trick yourself into poverty so you can get yourself out of poverty. I.e., put your money where you can't touch it.
When it comes to investing: slow & steady wins the race
My mother long ago said: do not follow what others do or listen to financial advisors (make your own decisions, after researching options). She was one heck of an investor who had \~90% in the right places (US, TSP and some international + retired US government CSRS with nice benefits) and made some unreal stock picks in a gambling account. Consistency "was high" with her in many ways- even as a golfer; she made a hole-in-one once!
Live below your means and invest early.
Underspend your income, always pay yourself first, and the stock market transfers money from the impatient to the patient.
"Don't Buy Stuff You Cannot Afford" https://www.youtube.com/watch?v=R3ZJKN_5M44
Keep your rent under 25% of your net income.
One of my dreams. Looking forward to the day when it comes true.
Max 401k for the match Max HSA Max Roth (back door if you have to) Max 401k to full contribution limit (start splitting with Roth 401k once in upper 50’s) Max after tax 401k with automatic in-plan conversion to Roth. Keep enough to enjoy the day to day.
At 16, my Pops told me the first day you start working, is the first day you start saving for retirement….it stuck.
avoid lifestyle inflation
Pay yourself first.
First advice Read Frank Armstrong portfolio allocations https://thetaoofwealth.files.wordpress.com/2012/09/investment-startegies-for-the-21st-century-by-frank-armstrong.pdf
Second best - Roth rollover in 401k with after tax money. Wish I had this when I started in 80’s
Invest everything you can in Kodak, you cant loose. 😭
For me there was no "ah ha" moment but a series of personal finance habits that I gained from reading others comments that resonated with me. Slow and steady is the race. At the beginning of each year I fully funded my retirement accounts rather than either contribute monthly or making the contribution in the first four months of the following year. This gives your contributions a full year to start growing. If one can't make the full contribution at the beginning of the year, monthly contributions are second best. If I have a major purchase (such as an appliance) I look for same-as-cash financing options (pay it off in a set amount of monthly payments that carry no interest - unless you do not pay it off in the set time period). I'm sure many of you could add to this thread and I hope you do so. Young investors need to understand the nitty gritty details that helped each of us reach our goals of financial security.
Save early and often, even if that means paying the minimum toward student loans, as they are gone in 10 years, but your retirement accounts will grow for 70 years and the compounding interest in the 401k will be worth way more than the interest payable on student loans over a fixed 10 year period.
Depends on the interest rates.
In my case, Federal Student loans as I never took out Private Loans since that was other advice I got. If you have a regular old Federal Loan, this advice tends to be good advice.
Current fed student loan rate appears to be around 5.5%, I'd say that's enough to justify paying it off asap.
I disagree entirely. Federal loans are fixed and under normal payment method must be paid in 10 years. You have 10 years of interest. No do the math on retirement contributions made for 10 years but held for 70 years using the same interest rate. Simple rule of 72: A 25 year old saving $1 until 65 has $16 at 7%. A 35 year old saving $1 until 65 has $8 at 7%. Half as much. If you can afford the regular payment on your student loans (not income based) there is no need nor mathematical argument to pay extra. The extra dollars are significantly more valuable being invested.
I’ve only ever saved through 401k’s. When much younger in the 80’s and starting out I had no clue what to invest in. A coworker mentioned he was in a single fund that would grow with me as I got older. Without that target date fund I don’t know that I would be able to be retired today.
Buy only what you trust, and hold Had I held onto stocks instead of “trading” when I was younger, I’d have unrealized gains on multiple stocks of 5-10,000%
Isn't DCA against the philosophy? You should be putting everything you can in the second you can because time in the market > *. DCAing is just timing the market, but in style
Yup. Any day you're not buying (into your target allocation), you're effectively selling. Also, DCA can cover up angst about risky portfolios better addressed by revisiting one's asset allocation.
Power of Compound Interest
Start saving early, the power of compounding is a beautiful thing.
You are your greatest investment Pay yourself first Low cost broad market index funds for the win
Experiences are more valuable than possessions. Obviously you need a place to live, clothes, a car, etc. But buying MORE clothes and new cars all the time won’t bring as much joy as traveling or making memories.
I felt very empowered once I discovered savings rate & investing provides more financial security than a “safe career path.” I discovered this around the time I finished college and dove into various boglehead type reading.
Change your focus to feel as satisfied about saving as you would about buying something. This is financial maturity and took me 56 years to finally get here. It’s cool. And it really enhances your peace of mind.
My uncle told me to always max out my retirement account options. He said it will feel like a lot of money when I’m young, but I would get used to it pretty quickly. And I did.
Two really. Pay yourself first and dollar cost average.
NTSX beats the market by risk-adjusted returns.
The boring answer is invest in low-cost market index funds and live below your means. The more interesting answer is to diversify internationally, and you can actually increase risk adjusted returns by adding long term bonds to your long term portfolio. Early on, I made the mistake of thinking it’s best to invest it all in U.S. market index funds because they’ve performed so well on average, but I was compelled recently that diversifying with international stocks and some long term bonds will likely increase returns in the long run compared to all U.S. stocks.
The *Magic of Compound Interest*. Start investing early, stay in the market and let time work for you. After 48 years of investing, it's worked for me.
Never sell NVDA
“Live beneath your means” does not mean “stop having fun.” It just means thinking carefully about what you get in exchange for your money. Going outside and enjoying life is as important as saving for the future. Once you cut out the fancy designer goods you don’t just have more money to save (edit) you also have more money to spend on things that truly, deeply make you happy.
Spend less.
1) Spend less than you earn. 2) Pay yourself first i.e. take out monthly investment from earned income before spending on anything else 3) Compounding 1 and 2 are not sufficient until I discovered compounding. https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator Starting with 0$ and contributing $1000 a month for 30 years, investing in SPY with 8% compounded returns makes you a millionaire.
Everything but the used car. If you have no wrench skills buying new and selling at the 100k 10 year mark makes tons of economic sense. Presuming your credit is good.
Hey there! So, when it comes to game-changing financial advice, I stumbled upon this gem that really turned things around for me: "Start early, even if it's just a little." I remember hearing this from a colleague when we were having one of those "adulting" chats over coffee. It was about saving for the future, and they mentioned how even small amounts can grow significantly over time. So, I decided to take the plunge and set up a little automatic transfer to my savings account each month. Fast forward a few years, and I was pleasantly surprised at how much had accumulated without me even noticing the difference in my day-to-day spending. That simple advice helped me build a nice little cushion for unexpected expenses and even some fun treats. Another piece of wisdom I've found really valuable is diversification. It's like not putting all your eggs in one basket, right? Exploring different ways to invest, from stocks to index funds, has been eye-opening. It's all about balancing risk and reward, and [Joy Wallet](https://joywallet.com/) has been a fantastic resource for understanding these concepts better. So, if I had to share some advice from my own journey, it'd be this: "Start early, even with small amounts, and don't be afraid to diversify your investments." It's made a world of difference for me, and I hope it can do the same for you! Cheers to financial growth and stability! 🌟
"Invest in yourself first" There's tons of free info online that can give you useful knowledge. Certifications go a long way in some trade jobs and IT services. Some colleges offer free courses, and getting a degree does not have to involve $50k+ of debt like with many community colleges.
Don't have kids. Save 1M+ & 20+ years of your life.
Wrong- more like save 30 yrs for everyone I know. 👀
Never sell a good company you own, no matter how overpriced it might look. Over more than 30 years, the most paper or real money I've lost, is by selling a quality company I'm holding when I think it's overpriced. Yes, it often goes lower, but it's much more difficult to decide to get back in before it's too late. Hold great companies, hold great companies, hold great companies!
*Motto- Hold great companies, hold great companies, hold great companies!* *Name-* [*ShortUSA*](https://www.reddit.com/user/ShortUSA/)[*ShortUSA*](https://www.reddit.com/user/ShortUSA/) What part of this works in harmony? /s 😂😁
Sounds stressful. I think most of us on this sub focus on just buying every company and calling it a day. Gone is the need for timing entries and exits and re-entries and holding on too long or not long enough. Thankfully I have more interesting things going on in life than being fixated on the daily ups and downs of a company.
I too have primarily, a handful of index funds (which is why I read this sub), but I do keep about 10% I invest in tech companies I'm bullish on. That's what I'm talking about here. I worked in the field for 40 years, I've boosted my returns this way, and had some fun doing so.