The 10 Steps of the Bogleheads® Investment Philosophy are: 1. Develop a plan including living below your means, budgeting, saving, and avoiding excess debt. Put the plan in writing through an Investment Policy Statement. 2. Invest early and often to take advantage of compound growth over time. 3. Find the right asset allocation that balances risk and returns for your risk tolerance. 4. Diversify across different asset classes to reduce risk. 5. Never try to time the market which most investors do poorly at. 6. Use low-cost index funds to participate in market growth while avoiding common investor mistakes. 7. Keep costs low to maximize returns. 8.

1. 10 Steps of the Bogleheads®
Investment philosophy
• Laura Ricci
• Milwaukee Bogleheads
• September 1, 2015
Student Level Expertise Ages: All

2. Develop a Plan
• Live below your means
o Have a budget
o Save
o Avoid excess debt
• Put it in writing
o Imagine a likely scenario, make assumptions
o The enemy of a good plan is the search for a perfect plan
o Write down your Investment Policy Statement (IPS) so you can reference it
occasionally, discuss it with advisors and family members.

3. Invest Early and Often

4. Invest Early and Often

5. Never Bear Too Much or
Too Little Risk
• Too much risk will drive you to the wrong decisions
during market downturns.
• Too little risk will lower returns significantly and allow
inflation to erode the value of your savings.
• Try out a variety of tools to find the asset allocation
that suits you best.

6. Diversify

7. Never try to time the
market
• Typical investors buy high and sell low. Don’t be
typical.
• Don’t be one of the “Smartest Guys in the Room”
like Enron.

9. Use Index Funds
• Participate in the market’s growth and dividends
• Avoid dumb investor tricks
o Buying on old information that is new to you
o Selling when the market dips to retreat to safety
• After the cow has left the barn
• Being out of the market for the recovery

10. Keep Costs Low

12. Minimize Taxes
• Take advantage of tax-advantaged accounts:
401K, 403b, IRAs, etc.
o Use it or lose it

13. Invest with Simplicity
• “When there are multiple solutions to a problem,
choose the simplest one.” Occam's Razor by John Bogle
• 3 Fund Lazy Portfolio:
o US Stocks
o Bonds
o International Stocks
• Target Retirement or Life Strategy Fund

14. Stay the Course
• Essential to success
o When the market drops, it can be difficult to follow your plan. Create an
asset allocation that suits your appetite for risk.
• Tune out the chatter
o “Bad news sells papers.”

15. Milwaukee Bogleheads®
• A DIY investment group, followers of John Bogle's
Index investing strategies, the Milwaukee local
chapter of Bogleheads.
• This presentation was made September 1, 2015 by
Laura Ricci of our chapter.
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16. Where to Get More
Information
• http://www.bogleheads.org/wiki/Investment_policy
_statement
• http://www.bogleheads.org/wiki/Video:Bogleheads
®_investment_philosophy

17. Disclaimer
• All examples are for illustration purposes only and
are not investment recommendations.
• The views expressed in the presentation, are those
of the presenter, commenters, guests and
participants and may not reflect the views of the
Bogleheads organization.
• Use your discretion in using examples presented
here for your own investment purposes.
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