Book Review: The Bogleheads Guide to Investing

Here is another book review about an investing book. This is the second book I read in my way to personal finance enlightenment: The Bogleheads Guide to Investing, by Taylor Larimore, Mel Lindauer and Michael LeBoeuf.

This book is a complete guide about personal investing, how to save money and how to invest it. I personally think it’s a really good book, well-written and full of very good advice. The book is full of quotes from other financial figures and every argument is well supported by facts.

What is really good about this book is that it’s very complete, it covers a lot of different subjects and contains really tangible advice that you can follow.

This book contains several very important messages:

  1. Avoid debt: This one is a no-brainer 😛
  2. You should start to invest early: By the magic of compounding, starting early even with small sums, will amount to a large amount
  3. Know what you are buying: This one is very important. You should only consider investing in assets that you actually understand. If you don’t understand an asset, you should not invest, you should always research before you invest or seek advice
  4. Know how much you need for retirement: If you plan to retire early, you should know exactly how much money you’ll need and how much expenses you have each month.
  5. Keep it simple: Invest in few index funds that are replicating the entire stock market and stick with you strategy
  6. Minimize the costs of your investments: Only use no-load funds with very low fees.
  7. Don’t try to time the market: Market timing is not possible in the long term, simply stick with your long-term strategy.
  8. Rebalance if necessary: If some of your assets are doing extremely well, as will be the case for stocks in a long run bull market, you should rebalance by selling some of your stocks and invest them into bonds. This should help you by buying low and selling high automatically. Not everybody likes this rebalancing idea, so you need to be careful about that. The important thing is to be aware that unbalancing will occur eventually.
  9. Diversify: Don’t put all your eggs in the same basket. There is no point in investing in two funds that have the same assets inside.

All these messages (and a lot more) are quite well explained and well supported by facts.

Overall, I think it’s a great book that deserve to be read. If you are willing to invest but don’t know exactly how, you should definitely take a look at this book and profit from its advice in order to elaborate a sound investment strategy.


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