Introduction: Ten Rules for Financing Life
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This is an introduction to ten short videos about simple investment principles that everyone should know.
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Rule #1: Develop a Workable Plan
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Start by thinking about what you need money for, and when. Take this first step towards creating a simple plan. Having it in writing will help give you discipline to be a good investor.
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Extra: Start with a Sound Financial Lifestyle
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If you haven't already, you should use the very first money you save to establish a sound financial lifestyle before investing for your future.
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Rule #2: Invest Early and Often
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This quick example illustrates the miracle of compound interest and the importance of starting to save early.
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Extra: Eighth Wonder of the World
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The miracle of compound interest is so amazing that many have called it the Eighth Wonder of the World. This video vividly demonstrates this.
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Rule #3: Never Bear Too Much or Too Little Risk
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The ratio of stocks and bonds that you own is your key lever that controls the overall risk (variability) of your investments.
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Rule #4: Diversify! Diversify! Diversify!
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It's not enough to own stocks of hundreds of companies. Learn about the "magical" benefits of poorly correlated investments. This important concept is called "asset allocation".
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Rule #5: Never Try to Time the Market
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The vast majority of investors earn less than the market due to two common timing mistakes: buying yesterday's top performers, and letting your emotions cause you to attempt to predict the direction of the stock market.
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Rule #6: Use index funds when possible
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Learn how to tell a good mutual fund from a bad one. What is an index fund? And, why do they outperform in the long run?
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Rule #7: Keep Costs Low
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Mutual fund costs are a big reason that the average investor's return is much less than the total stock market average. Learn more about why this is and how to tell a good fund from a poor one.
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Rule #8: Minimize Taxes
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Take full advantage of tax-advantaged accounts, then use these accounts to hold your bonds. Learn why, and more.
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Rule #9: Keep it Simple
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All things being equal, choose the simple path. You'll increase your chance of success, and have more time to enjoy your life. See how to bring all these points together into a simple written plan.
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Rule #10: Stay the course
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Let there be no mistake: you are only human and you will face great temptation to change your plan. Your best defense (against yourself!) is to pull out your written plan and review it.
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I'm ready to do more. What would you like to see next? Please comment below.
Want to Learn More?
These videos introduce these principles with short entertaining video segments to give you the big picture and an orientation. If you seek more detailed information or an informative discussion board I highly recommend the Boglehead Wiki, the Boglehead Forum (both endearingly named after Jack Bogle), or any of these recommended books.
Want to Help Others?
Share a specific video or a link to this homepage video index. Help your friends tune out the noise of people trying to sell something and help make the world more financially literate, one person at a time.
