The Bogleheads Guide to Investing
Dec 2023
4 min read
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- Choose and live a sound financial lifestyle. We need to pay off our credit card debt, establish an emergency fund, get our spending under control, and most importantly, learn how to live below our means, since that’s really the key to financial freedom.
- Start to save early and invest regularly. The earlier we start, the longer we’ll enjoy the powerful benefits of compounding.
- Know more about the various investment choices available to us, such as stocks, bonds, and mutual funds. For most investors, mutual funds offer great diversity in a single investment. Don’t invest in things you don’t understand.
- Figure out approximately how much you might need for your retirement, so you’ll know if you’re on track. You can’t reach your goal if you don’t have a target!
- An asset allocation plan is based on your personal circumstances, goals, time horizon, and need and willingness to take risk. Risk and higher expected returns go hand in hand. There’s no free lunch. Make your investment plan as simple as possible.
- Rebalancing is important. Rebalancing controls risk and may reward you with higher returns. Stick with your chosen rebalancing strategy.
- Market timing and performance chasing are poor investment strategies. They can cause investors to underperform the market and jeopardize financial goals.
- Know how to handle a windfall, if you receive an inheritance or get lucky and hit the lottery.
- Understand the importance of protecting the future buying power of your assets by investing in such things as inflation-protected securities. Remember, inflation is a silent thief that robs you of future buying power.
- Tune out the noise and do not get distracted by daily news events. Avoid hot investment fads and following the herd as it stampedes towards the cliff ’s edge. Believing that “It’s different this time” can cause severe financial damage to your portfolio.
- Protect your assets with the proper types and amounts of insurance. Insurance is for protection. It’s not an investment. Don’t confuse the two.
- We need to master our emotions if we want to be successful investors. Letting your emotions dictate your investment decisions can be hazardous to your wealth.
- Make your money last at least as long as you do. Overly optimistic withdrawal rates may cause you to run out of money before you run out of breath.
- Proper estate planning ensures that assets pass to heirs in a reasonable time and with minimum taxes.
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All the Mutual Fund investors have to go through a one-time KYC (Know Your Customers) process. Investor should deal only with the Registered Mutual Funds (RMF). For more info on KYC, RMF and procedure to lodge/redress any complaints, visit https://www.pgimindiamf.com/ieid.
MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY. Read more
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