The Bogleheads' Guide to Investing, 2nd Edition

The Bogleheads' Guide to Investing, 2nd Edition

by Mel Lindauer, Taylor Larimore, Michael LeBoeuf, John C. Bogle
Released November 2021
Publisher(s): Wiley
ISBN: 9781119847670

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Book description

The irreverent guide to investing, Boglehead style

The Boglehead's Guide to Investing is a DIY handbook that espouses the sage investment wisdom of John C. Bogle. This witty and wonderful book offers contrarian advice that provides the first step on the road to investment success, illustrating how relying on typical "common sense" promoted by Wall Street is destined to leave you poorer. This updated edition includes new information on backdoor Roth IRAs and ETFs as mainstream buy and hold investments, estate taxes and gifting, plus changes to the laws regarding Traditional and Roth IRAs, and 401k and 403b retirement plans. With warnings and principles both precisely accurate and grandly counterintuitive, the Boglehead authors show how beating the market is a zero-sum game.

Investing can be simple, but it's certainly not simplistic. Over the course of twenty years, the followers of John C. Bogle have evolved from a loose association of investors to a major force with the largest and most active non-commercial financial forum on the Internet. The Boglehead's Guide to Investing brings that communication to you with comprehensive guidance to the investment prowess on display at Bogleheads.org. You'll learn how to craft your own investment strategy using the Bogle-proven methods that have worked for thousands of investors, and how to:

  • Choose a sound financial lifestyle and diversify your portfolio
  • Start early, invest regularly, and know what you're buying
  • Preserve your buying power, keeping costs and taxes low
  • Throw out the "good" advice promoted by Wall Street that leads to investment failure

Financial markets are essentially closed systems in which one's gain garners another's loss. Investors looking for a roadmap to successfully navigating these choppy waters long-term will find expert guidance, sound advice, and a little irreverent humor in The Boglehead's Guide to Investing.

Table of contents

  1. Cover
  2. Acknowledgments
  3. Foreword
    1. BOGLE AND THE BOGLEHEADS
    2. THE BOGLEHEADS MESSAGE
    3. THE BOGLEHEADS AND BENJAMIN FRANKLIN
    4. WHAT’S A BOGLE TO THINK ABOUT THE BOGLEHEADS?
  4. Introduction
    1. MEET OUR LEADER
    2. MEET THE BOGLEHEADS
    3. ABOUT THE BOGLEHEADS’ GUIDE
  5. Part I: Essentials of Successful Investing
    1. Chapter One: Choose a Sound Financial Lifestyle
      1. WHAT’S YOUR FINANCIAL LIFESTYLE?
      2. TAKE THESE STEPS BEFORE YOU START INVESTING
    2. Chapter Two: Start Early and Invest Regularly
      1. THE MAGIC IS IN THE COMPOUNDING
      2. THIS ABOVE ALL: SAVING IS THE KEY TO WEALTH
      3. FINDING THE MONEY TO INVEST
      4. SUMMARY: THE MOST IMPORTANT THINGS
    3. Chapter Three: Know What You’re Buying: Part One
      1. STOCKS
      2. BONDS
    4. Chapter Four: Know What You’re Buying: Part Two
      1. MUTUAL FUNDS
      2. MUTUAL FUND MANAGEMENT STYLES
      3. ANNUITIES
      4. EXCHANGE-TRADED FUNDS
      5. WHAT WE’VE LEARNED
    5. Chapter Five: Preserve Your Buying Power with Inflation-Protected Bonds
      1. I BONDS
      2. TIPS
      3. SUMMARY: I BOND VERSUS TIPS
    6. Chapter Six: How Much Do You Need to Save?
      1. PUTTING WHAT WE’VE LEARNED TO WORK
    7. Chapter Seven: Keep It Simple
      1. HOW INVESTING IS DIFFERENT FROM MOST OF LIFE
      2. INDEX INVESTING: IT PAYS TO BE LAZY
      3. WHY INDEXING IS SO EFFECTIVE
      4. HOW TO BUY INDEX FUNDS
      5. BOGLEHEADS AND ACTIVELY MANAGED FUNDS
    8. Chapter Eight: Asset Allocation
      1. THE EFFICIENT MARKET THEORY (EMT)
      2. MODERN PORTFOLIO THEORY
      3. DESIGNING OUR PERSONAL ASSET ALLOCATION PLAN
      4. PORTFOLIO GUIDELINES
    9. Chapter Nine: Costs Matter
      1. FEES COVERED BY THE PROSPECTUS
      2. FEES NOT COVERED BY THE PROSPECTUS
      3. ADDING IT ALL TOGETHER
      4. TAKING ADVANTAGE OF LOWER COSTS
      5. LOW COST AS A PREDICTOR
      6. CONCLUSION
    10. Chapter Ten: Taxes: Part One
      1. THE DEVASTATING IMPACT OF TAXES
      2. HOW MUTUAL FUNDS ARE TAXED
      3. TURNOVER AND TAXES
      4. INVESTING IN TAXABLE ACCOUNTS
      5. BONDS IN YOUR TAXABLE ACCOUNT
    11. Chapter Eleven: Taxes: Part Two
      1. USE TAX-SHELTERED ACCOUNTS
      2. PLACING FUNDS FOR MAXIMUM AFTER-TAX RETURN
      3. TAX-SAVVY IDEAS
    12. Chapter Twelve: Diversification
    13. Chapter Thirteen: Performance Chasing and Market Timing Are Hazardous to Your Wealth
      1. PAST PERFORMANCE DOES NOT PREDICT FUTURE PERFORMANCE
      2. MARKET TIMING
      3. FINANCIAL NEWSLETTERS
      4. FINANCIAL SHOWS ON TV
      5. WALL $TREET WEEK
      6. FINANCIAL MAGAZINES
      7. THE BOGLEHEADS CONTEST
      8. PREDICTING INTEREST RATES
      9. STAY THE COURSE
    14. Chapter Fourteen: Savvy Ways to Invest for College
      1. METHODS OF SAVING FOR COLLEGE
      2. SUMMARY OF COLLEGE SAVINGS PLANS
    15. Chapter Fifteen: How to Manage a Windfall Successfully
      1. WINDFALLS ARE ABOUT A WHOLE LOT MORE THAN MONEY
    16. Chapter Sixteen: I helped put two children through Harvard—my broker’s children.
      1. THE ALPHABET SOUP OF FINANCIAL DESIGNATIONS
  6. Part II: Follow-Through Strategies to Keep You on Target
    1. Chapter Seventeen: Track Your Progress and Rebalance When Necessary
      1. PRINCIPLES OF REBALANCING
      2. ASSESSING A PORTFOLIO
      3. WHEN SHOULD I REBALANCE?
      4. MARKET FORCES
      5. HOW TO REBALANCE
      6. OTHER REBALANCING CONSIDERATIONS
    2. Chapter Eighteen: Tune Out the “Noise”
      1. THE GREAT WALL STREET MARKETING MACHINE
      2. WHAT THE INVESTMENT MEDIA DON’T WANT YOU TO KNOW
      3. THE THREE BIGGEST LIES—WALL STREET VERSION
      4. SEPARATING SOOTHSAYERS FROM THE TRUTH SAYERS
    3. Chapter Nineteen: Mastering Your Investments Means Mastering Your Emotions
      1. WELCOME TO THE FIELD OF BEHAVIORAL ECONOMICS
      2. GREED AND FEAR
      3. HOW SMART PEOPLE MAKE BAD INVESTMENT DECISIONS
      4. KEEPING EMOTIONS IN CHECK
      5. HOW TO ESCAPE THE EMOTIONAL TRAPS
    4. Chapter Twenty: Making Your Money Last Longer Than You Do
      1. THE RETIREE’S SPENDING DILEMMA
      2. THE TWO BEST WAYS TO INSURE INCOME FOR LIFE
      3. THREE MORE WAYS TO ENSURE INCOME FOR LIFE
      4. A PRUDENT PLAN FOR TAPPING YOUR PORTFOLIO
    5. Chapter Twenty-One: Protect Your Assets by Being Well-Insured
      1. COMMON INSURANCE MISTAKES
      2. THREE KEY RULES FOR BEING PROPERLY INSURED
      3. LIFE INSURANCE
      4. HEALTH CARE
      5. LONG-TERM DISABILITY COVERAGE
      6. PROTECTING YOUR PROPERTY
      7. LONG-TERM CARE
      8. LOCATING GOOD INSURANCE COMPANIES AND AGENTS
    6. Chapter Twenty-Two: Passing It On When You Pass On
      1. DOCUMENTS WE’LL NEED
      2. OTHER CONSIDERATIONS
      3. GIFTING
      4. LETTER OF INSTRUCTION
      5. DISCLAIMER
    7. Chapter Twenty-Three: You Can Do It
      1. WHAT WE’VE LEARNED
      2. HELP FROM THE BOGLEHEADS
      3. IN CLOSING
  7. Appendices
    1. Appendix I: Glossary of Financial Terms
    2. Appendix II: Books We Recommend
      1. BOOKS FOR NOVICE INVESTORS
      2. BOOKS FOR INTERMEDIATE INVESTORS
      3. BOOKS FOR THOSE WHO WANT TO LEARN MORE
    3. Appendix III: Financial Websites We Recommend
    4. Appendix IV: Vanguard Asset Allocation Questionnaireand Pie Charts
  8. About the Authors
  9. Index
  10. End User License Agreement

Product information

  • Title: The Bogleheads' Guide to Investing, 2nd Edition
  • Author(s): Mel Lindauer, Taylor Larimore, Michael LeBoeuf, John C. Bogle
  • Release date: November 2021
  • Publisher(s): Wiley
  • ISBN: 9781119847670