The Bogleheads' Guide to Retirement Planning (52 page)

Although Las Vegas might be the last place you’d expect to find a Bogleheads reunion, it turned out to be ideal for Diehards V. The Las Vegas Money Show featured Jack Bogle as a speaker, and they invited the Bogleheads to hold our reunion as part of their event. Las Vegas Boglehead Dale Bottoms served as the local coordinator, and attendance increased, with 83 Bogleheads attending.

The event continued to evolve with a welcome reception on day one followed by a Q&A with Jack Bogle, book signings by Jack Bogle and all the Bogleheads authors in attendance, and a Q&A with the Bogleheads authors (Rick Ferri, Taylor Larimore, Michael LeBoeuf, Mel Lindauer, and Bill Schultheis). The evening banquet was capped off when all those Bogleheads who had volunteered to help out with the reunion were personally presented with a Bogle bobblehead by Jack Bogle himself. (Who says it doesn’t pay to volunteer?)

Following the successful reunions with links to various sponsoring organizations, the Bogleheads were ready to step out on their own. Ed and Patti Rager volunteered as local coordinators and headed up the small team hosting Diehards VI in Washington, D.C. They did an outstanding job, and the event went off flawlessly, with 117 Bogleheads in attendance.

Jack Bogle had previously named Taylor Larimore “King of the Bogleheads,” and he called Mel Lindauer “The Prince of the Bogleheads.” Realizing that the Bogleheads had no queen, Taylor and Mel decided to crown Laura, one of the premier posters on the Bogleheads forum, as “Queen of the Bogleheads” in a ceremony at the reunion. After she was crowned Queen Laura Dogu, she was then invited to participate in the Q&A with the experts as a panel member.

Sue Stevens and Ed Tower of Duke University’s Economics Department joined the panel discussion, and Jack Bogle added a fireside chat with Bill Bernstein just prior to the evening banquet.

Following a return to the East Coast in 2007, it was time to head west again. Paul and Linda Globerson offered to act as local coordinators in San Diego for Diehards VII. The ability to spend time with Jack Bogle and the rest of the Bogleheads in an intimate setting makes these events special, so attendance was limited to 130 spots, which were quickly filled.

The San Diego reunion again featured a panel of experts including Bill Bernstein, Rick Ferri, Queen Laura, Michael LeBoeuf, Mel Lindauer, Bill Schultheis, Sue Stevens, and Ed Tower. Jack Bogle mentioned that he had enjoyed his impromptu fireside chat with Bill Bernstein prior to the last banquet and would like to continue that tradition, and what Jack wants, Jack gets!

The evening banquet was topped off when a group of attendees called the Boglettes performed a choreographed rendition of “Our Guy” for Jack Bogle. Jack obviously enjoyed it immensely, and after the performance, Jack posed for a picture with the Boglettes. That picture of Jack and his Boglettes appeared in a feature story that Art Carey did about Jack for the
Philadelphia Inquirer
.

Morningstar.com sent Christine Benz and a videographer to cover the event, and Christine taped a number of interviews with Jack Bogle, Bill Bernstein, Rick Ferri, Mel Lindauer, Queen Laura, and Michael LeBoeuf for viewing on Morningstar’s web site.

The Lone Star state beckons while we write, as Texas Bogleheads Gail Cox, Jon Fortman, and Don Lee are busy preparing for the next gathering of the supporters of Jack Bogle. You can read about all the reunions, view pictures, and listen to videos of some of the events at the Bogleheads.org library. Perhaps we’ll see you at one of our future reunions or online. This is the first conference to be called a Bogleheads reunion to better align the community with our mentor, Jack Bogle.

The Bogleheads are doing all we can to spread the word and to further the causes of our mentor, the man who inspires us all, Jack Bogle. Obviously, our Internet forum work is an attempt to help investors get their fair share by offering free and unbiased information. And to honor the philanthropic spirit of Jack Bogle, all proceeds of this book are being donated to the National Constitution Center in Philadelphia, where they honored Jack’s service as chairman by dedicating the John C. Bogle Chairman’s Room upon his retirement. We consider it a real honor to be called Bogleheads and to be associated with this great and noble man.

We asked all registered members of the Bogleheads forum to share some of their favorite pearls of wisdom about saving and investing for retirement. Some of the quotes here are original and others are familiar expressions worth repeating. The italics after each quote is the screen name of the Bogleheads’ members who suggested it. The response to the request for pearls of Wisdom was overwhelming, and there was not enough room to include them all.

“Save 10% of everything you earn.”
J Daniels

“Get your spending in check before worrying about how much you can save.”
psu9932

“Pay yourself first.”
VictoriaF

“When deciding when to retire, only two numbers are significant: how much money you have, and how long you will live. The rest is easy.”
a2z

“Plan your future first; then create a financial plan to support it.”
Peter Foley

“If your plan seems too simple, you’ve probably got a good plan.”
deepdrive

“If you have saved just enough to retire, you probably cannot afford to retire. The market may go down.”
Jsl11

“A younger investor should be focused on their savings rate rather than high investment returns.”
haban01

“Saving and investing wisely is your route to freedom.”
nvboglehead

“A happy financial retirement is the result of many years of staying the course, but more importantly, being too busy to mess up a well-designed investment plan.”
Speedbump101

“It’s what you keep, not what you earn. Focus on net worth.”
Bulldawg

“Don’t view it as saving. Think of it as buying independence.”
Trebor

“Minimize taxes as far as practicable.”
Below The Radar

“A proper withdrawal strategy in retirement is as important, or more so, than is an investment strategy in accumulation because time is no longer your ally.”
Joe Bob

“Early on, focus on your savings rate instead of your rate of return.”
snoop-doug 1

“Sew the seed of a miracle—start a retirement account for your baby for many decades of compounding returns.”
Tonen

“There is no such thing as a perfect plan.”
Chaz

“To new investors: Your risk tolerance is probably much lower than you think.”
Haberd

“No one would ever have crossed the ocean if he could have gotten off the ship in the storm.”
wilson08

“Don’t invest in things you don’t understand.”
cisco

“If you think you are smarter than the market, just remember: ‘A fool who considers himself wise is indeed a fool.’”
NYCPete

“Live actively, invest passively.”
Derek Tinnin

“A new twist on an old favorite; KISS: Keep investing simple, stupid.”
salem

“Buying into active management is buying into a dream that probably will not occur.”
DA

“Beware of little expenses. A small leak can sink a great ship.”
VictoriaF

“Your life should be interesting; your investments should be boring.”
VictoriaF

“If you wouldn’t feel comfortable underperforming the market for years at a time, the only investment for you is a total market index fund.”
deepdrive

“Do you want to put your kids, or your broker’s kids, through college?”
speedbump101

“Keep the money you will need in the next 3-5 years out of the stock market.”
HueyLD

“Costs are the one thing you can control when investing.”
Index Fan

“Keep it simple. Minimize the time spent on investments. Maximize the time spent on more important things.”
ramsfan

“View your risk tolerance through the darkest possible lens because you will probably experience it in that light at some point during your lifetime.”
mikem

“When it comes to investing, never underestimate the majesty of simplicity.”
MarkNYC

“Stock holders are the last to get paid in a long line of people.”
gms

“Dividend checks don’t bounce.”
unclemick

“Investing doesn’t require a PhD if you keep it simple and keep your expenses low.”
Sally

“The easiest way to double your money is to fold it in half.”
cisco

“Don’t take any more risk than you need to meet your goals.”
haberd

“The only way to underperform the market after costs is to deviate from it.”
drbagel

“Investing ain’t rocket science—they just make it look like it is.”
jeff mc

“A simple set of low cost mutual funds is your best defense for a healthy retirement!”
Russ Nelson

“The more complicated the investment, the better it is for the person selling it, and the worse it is for the investor buying it.”
Dale Maley

“As Benjamin Graham said: Never have less than 25% or more than 75% of your portfolio in stocks.”
Anonymous

“As Ted Aronson said: It takes between 20 and 800 years of monitoring performance to statistically prove that a money manager is skillful rather than lucky.”
Anonymous

“Disciplined rebalancing is emotionally difficult. That is why one must have a written plan in advance, and stick to it!”
Below The Radar

“Lifecyle funds—it really can be that easy.”
RJW

“You can’t buy yesterday’s returns—they’re gone forever.”
Compounding

“Timing the market is like sticking your head into an angry hive of bees. You might get some honey, but you’ll most likely get stung.”
Xyrus

“There are two types of financial experts; those that are lucky and those that aren’t.”
Xyrus

“The pathway to the ‘heaven’ of investing is lined with the advice of our mentor, Jack Bogle.”
normsie

“Invest in the stock market as opposed to betting on the stock market.”
Kathleen Ryan

“Negative years WILL happen, perhaps several in a row. Expect it!”
Below The Radar

“Never change your long-term investment plan based on short-term results.”
petrico

“Time and low costs are your friends; high expenses and taxes are your enemies.”
Joe Bob

“If it takes more than a few minutes to explain your investment plan to someone, it’s probably too complicated.”
Roverdog

“Make sure your retirement portfolio can withstand a worst case scenario.”
JaneDoe

“Look at predictions based on historical returns with skepticism. Extrapolation beyond the range of a data set is risky.”
vb

“Don’t try to time the market.”
Kathleen Ryan

“As John Kenneth Galbraith said: The only function of economic forecasting is to make astrology look respectable.”
RadAudit

“If your portfolio decline is 50 percent, you will need a 100 percent gain to get back to even.”
krumw

“The consistently superior performer is the market itself.”
Derek Tinnin

“Invest your time actively and your money passively.”
Michael LeBoeuf

“There is no crystal ball, and you don’t need one.”
Derek Tinnin

“Your objective is to develop a diversified SWAN—Sleep Well At Night—portfolio through asset allocation that allows you to maximize your combined returns while minimizing risk.”
RTR 2006

“The best-kept secret in the investing world is the fact that almost nothing turns out as expected.”
Wshang

“Investing is a plow horse, not a race horse. Don’t treat investing as a competitive event.”
pkcrafter

“If an investment sounds too good to be true, run as fast as you can in the other direction.”
gotherelate

“Do not mistake simple index fund portfolios as simplistic. They are actually quite sophisticated—standing on the shoulders of decades of peer-reviewed market research, a few Nobel prizes, and undeniable evidence of success.”
Sunny

“If you don’t have time to read a good book or two on investing, you will be better served by simply putting your money in CDs.”
Bulldog Bond

“Until you’ve experienced the trauma of a large stock market decline, subtract 10 percent from the equity allocation you think you are comfortable with.”
happy2

“Be quick to listen and slow to speak.”
Ron

“Success is living your life the way you want.”
robert birchell

“If we don’t learn from past mistakes, we are doomed to repeat them.”
Sheepdog

“Don’t give investment advice to friends and family. Give ideas only.”
Sheepdog

“If you fail to plan, you plan to fail.”
bilperk

“Being charitable can result in some of the greatest returns during one’s lifetime.”
Random Musings

“As Germaine Greer said: You’re only young once, but you can be immature forever.”
Imbogled

“This time it may or may not be different.”
CABob

“Don’t treat the highly likely as certain, and the highly unlikely as impossible.”
Larry Swedroe