The Bogleheads' Guide to Investing

I read this book quickly shortly after I got it, and I was blown away. Many reviewers pick this as a book for "beginners", but I don't agree with that. My background: I have read (and own) dozens of investment books. I have subscribed to many newsletters (including Morningstar's, which is decent but unnecessary after you read this book). I have owned many individual stocks and for the last 2-3 years before I got the Boglehead religion I was lucky and beat the market averages buying individual stocks (although for most of my life I've lagged far below the market). I opened my first brokerage account in 1990, and I've been self-directed ever since. I've had 400%+ years as well as -70% years. I've even been in the top 100 virtual mutual funds on Marketocracy (out of 70,000), and I've written custom software to analyze the daily performance of the top 1500 stocks. Having said all that, I wish that I had followed the investment principles laid out in this book from the very beginning. I would have a lot more money than I do now. Before reading this book, I already had all my retirement money in Vanguard index funds. So you would think, end of story, you're already a believer. NOT SO! While I started out using the Target Retirement funds, which allocates your money properly for your age, I slowly deviated from those funds into the higher risk emerging markets index fund, because that fund was doing so well. It's easy to read this book and say, "oh that makes sense", stay the course for a year or so, then get seduced by the hot performance of a particular sector and lose your way. For these principles to work, you really have to apply them relentlessly, and I think that it takes either someone with an iron discipline or someone who's acquired "experience" in the market (i.e., losses that hurt) to recognize the wisdom of this book and follow it. Years ago, I read John Bogle's book on index funds, and I agreed with the logic of what he was saying. Then I proceeded to ignore it for most of my investing career before I really "got" what he was saying. Perhaps, if you're a beginner, you'll follow this book and avoid the pain and losses. The principles are easy enough to understand. In fact, if you want to save the price of the book, simply go to Vanguard, pick your retirement date, buy a "Target Retirement" fund for that date, and you're done. That's pretty much what the book tells you to do. BUT, you'll need the book (and, in my opinion, the "experience" of following the 99% of the misleading advice out there) to really understand why this is the real way to go. You almost have to read this book every year as an antidote to the temptation that assaults you nonstop from Wall Street and CNBC and all the financial magazines. If you're a beginning investor, this is it. This book is the mother lode. You can stop looking. Unfortunately, it may take you 10-15 years and many large losses to realize this (as I had to do), but take it from me (some random anonymous person on the Internet), this is the REAL DEAL. Knowing what I do now, if at age 21 I'd had my choice of $2,000,000 or the wisdom to understand the concepts in this book, I'd choose wisdom. Here are two examples from this book to illustrate why. On page 13 of this book Jack Bogle relates a letter that he received in early 2005 about someone who's been investing with Vanguard for about 30 years, and whose portfolio had grown to over $1.25 million, but he'd never made more than $25,000 in any year in his life. Although they knew nothing about his specific investing history (maybe he just got lucky? we don't know), this figure is attainable investing $600 a month in a Vanguard stock index fund over 30 years. On the other hand, according to an NBC News report related on page 180 of the book, more than 70 percent of lottery winners exhaust their fortunes within 3 years. So, clearly, doing the right thing is going to have a huge impact on how much money you end up with. Even the most experienced investors will benefit from this book (and in fact, may benefit more) by simplifying their portfolio. The chapters on asset allocation and taxes are extremely insightful, even to non-beginners. After reading this book, I immediately re-balanced my Vanguard portfolio to better fit my age group, and to lower the risk that I was taking. Even as an "experienced" investor already in Vanguard index funds, I learned something actionable that I was immediately able to apply. If you consider yourself an "experienced" investor, you will also benefit from reading this book. I highly recommend it. My ENTIRE retirement portfolio is in Vanguard index funds, allocated in the recommended amounts, so this is not an idle recommendation. Read it and live it. (Just so you know, I have never visited the Boglehead web site, and I have never corresponded with any of the authors. I'm just an uninterested third party who's a big fan of this book).

This book establishes a set of basic principles for investing and, to a lesser degree, personal finance. The authors propose the principles, explain them, illustrate them and show you how to apply them. The book glances on non-investment personal finance topics including adopting a net worth mindset, emergency funds, estate planning, and insurance. The insurance chapter was very valuable and exposed several fallacious rationalizations people apply to insurance purchase decisions. The meat of the book is investing. Investing is covered in great detail, including in-depth descriptions of various investments, how they work, and how (or if) you should use them. The coverage of the effect of taxes on your investments is detailed and invaluable. The costs of investing are examined, and when you know where to look, you may find some nasty surprises in your current investments, especially your 401k plan! The entire book is highly opinionated, and I found that refreshing. The authors know what they're talking about, have a good idea of what the average person saving for retirement needs to do, and never fail to call it the way they see it. The writing style is fact-based advice, with humorous sayings sprinkled about, and is best described as "grandfatherly." The chapter on behavioral economics was an eye-opener. I thought that I was smart enough not to fall for any of those traps. I smugly read through the first half of them, then recognized myself in "Paralysis by Analysis." Oh my. That gave me some food for thought, and a new outlook. I did find the chapter on Asset Allocation to be lacking in practical advice. It only glanced on how to make an asset allocation for yourself, and didn't address the difficulties of balancing an asset allocation over multiple tax-advantaged accounts that have contribution limits and withdrawal penalties. (But there's a list of recommended reading in the back, and maybe one of those books will have more information on this topic.) Having just finished the book, I'm going back through it and making a list of information I need and actions to take. I finally have a direction to go in, and not just more conflicting details!

Some people have commented that the advice in this book is sound and logical, but the flaw is that times have changed and therefore the information is outdated. How incredibly wrong and short-sighted! Yes, the days of 8-10% returns may be gone (it may be more like 6-7% according to Jack Bogle), but the information is still as relevant as ever. What gets to investors is that they've been burned by not one, but TWO huge bear markets in a single decade. They look at the paltry returns (1-2%) over the last 10 years, and then they look at the volatility and the uncertain times caused by the Greek debt crisis, and they postulate that stocks will never be the same again. Again, how short-sighted. One just needs to look at the history of the stock market, going back 100, even 200 years. How many past decades have had 2 horrendous bear markets like we've seen from 2000-2010? Not many! Times were tough the past decade, but things WILL get better, and in the past, they have! And let's look at the volatility we see now. It has ALL happened in the past before! Would you seriously think stocks have not been driven by negative headlines? How have World War 1 and 2, the great depression, and the cold war affected stocks? How about in more recent decades, i.e. in the 1980s? Stocks will typically go up, down, up, down, up, down, driven by headlines day to day. But if you buy your indexes and stick to them through the thick and thin, your portfolio WILL rise. Time is your best friend. It's certainly much better than saving in a bank savings account and have your money just sit there. Extremes in volatility we see now are not unprecedented, and things WILL get better. Many investors invest emotionally, and that is one of the biggest things that will burn you. Don't fall for it. Hold fast, hold tight, and you will be just fine. Read this book and heed its advice!

I feel very fortunate to have bought this book at the beginning of 2008 and still just a few years after graduating from college. I had finally found myself with a decent job and the ability to start putting away money. I quickly realized I didn't know where to start when it came to retirement savings. Money is something we all have to think about multiple times a day and those decisions have a long lasting effects on our future selves YET most of us don't get a proper education on how to manage our finances! This book got me thinking long term. Do I need to buy the most expensive phone? Do I need a brand new car? Can I put this charge on my credit card and pay it off in full at the end of the month? Maybe my hard earned money is better spent on my future, that one dollar saved today will be $8-$10 when I retire if I instead invest it. It taught me to not get fancy with mutual funds that peel off 1-3% in fees and instead stick to low cost index funds. That little 1% savings on fees over time could mean retiring when I am 55 or having to work another 10 years or more. As the financial crisis was hitting the US in 2008, and the stock market was tanking I was buying. I had quickly paid off my debts and my standard 10% retirement savings per month went to 20%, then 30%. By 2009 I was putting away nearly 50% of my income into my retirement and brokerage accounts. Ten years later I am debt free and in a much better financial situation than my peers. Buy this book, educate yourself and invest in your future.

This book helped me so much in figuring out how to keep my investments simple and why it's important to seek funds with very low fees. The authors do a great job of demonstrating why passively managed index funds usually beat actively managed, and more expensive, funds. As Jack Bogle says, "The shortest route to top quartile performance is to be in the bottom quartile of expenses." I was especially grateful for the book's in-depth discussions of tax efficiency and tax consequences. There are two entire chapters on taxes, as well as tax information sprinkled elsewhere in the book. I wound up reading parts of the book twice and will keep it on hand for future reference. I would have given it five stars but for the many typographical errors throughout the book. If this goes into an updated edition (and I hope it will, as it is from 2007 and much has changed in the financial world since the crash), I hope the publisher pays to have the book copyedited with a fine-tooth comb. Strong content deserves no less.

In short, get it, it's a very helpful book. I am fairly new to investing and felt that I was uncomfortable making choices as to what to choose as investments. This book gave me a great explanation of the many different choices to make in investing and how to go about them. This book actually covers more than just investing though, it touches on retirement and how to plan for it, wills, trusts, powers of attorney, insurance and a few other subjects that I felt were great topics and they covered well enough for me to understand, but didn't go into so much detail that I couldn't follow everything. In my honest opinion, every single school should be using this book and teaching kids about all the topics in here in 12th grade before they are released into the world. I've never read a book so fast in my life. In fact, I think that I did more reading in this book than I did in all of high school. It kept me interested and I don't feel that any of it was a waste of my time. For more experienced investors, I could even see this being a great refresher on topics, and I know that in the future I will be referring back to it when making choices in the future.

Did you always wanted to know the secret of making your money grow? When investing comes to mind we think of millionaires in their mansions making it big. Well investing isn't just for the well to do or presidential candidates but for everyone. Even the person who earns $25,000/year can be a successful investor as long as time is on your side. Buy this book to learn simple, cheap investing so you can keep all the returns the stock market can give you. This is a book that will benefit everyone especially the young investors coming out of high school it must be recomended reading for HS or the college freshman. The wisdom found here is worth more than the $12.00 you will pay to get this book. Stop listening to CNBC, Fox Business, CNN Money for financial advice and just get this book and other books by the venerable John C. Bogle.

I really really enjoyed this book. I'm a new DIY investor who decided to take my family's financial matters into my own hands rather then shelling out tons of money for investment advisers and money managers and hoping they have our best interest in mind. This book will serve as an excellent primer for me.The principles laid out here are straight forward and corroborate lots of the self-studying that I've been doing. The book touches on lots of subjects, and I appreciated that many of the fundamentals were complimented with references to studies and concrete examples to help illustrate a point. The book isn't very dry or technical, and given the subject matter is a pretty easy and informative read. I even got my wife to sit down and read it!

Un libro fantástico. Es un ejemplo de como se debe escribir un manual sobre cualquier tema. Un libro completísimo, que cubre todos los aspectos de la inversión, desde la planificación de la inversión, selección de activos, fiscalidad, brokers, etc. Además está muy bien organizado, de forma que puedes ir directamente, a los temas que te interesan sin necesidad de leer lo demás para entender esa parte. El libro está lleno de referencias a webs y foros gratuitos para obtener más información o ayuda posterior. Además, como va al grano el libro es corto y se lee con mucha facilidad. Para el que no conozca la filosofía Boglehead se enfoca en comprar y mantener fondos o ETFs indexados a largo plazo. Tiene la pega de que está enfocado al lector estadounidense y algunas partes como la relativa a la fiscalidad no es extrapolable al caso español.

Very enjoyable read, very informative and engaging. Gives a good overview of tracker funds and investment. Unfortunately quite a chunk is devoted to US specific financial information, so may not be completely relevant to an international audience. But overall, really good buy!

Aunque se centra en el caso americano es trasladable al caso español. Lo aconsejo 100 % a cualquier inversor particular

El libro muestra de forma fácil y pedagógica el poder del interés compuesto y la forma de conseguir ahorros a largo plazo con inversiones de altos retornos y bajas comisiones (la cantidad de dinero que se va por ahí sin darnos cuenta). Este en ingles pero es facil de entender. Es un libro obligado para cualquier inversor.