The document outlines 10 principles of the Bogleheads investment philosophy: 1. Develop a plan by living below your means, having a budget and savings plan, and writing down your investment policy statement. 2. Invest early and often to take advantage of compound growth. 3. Never bear too much or too little risk by finding an asset allocation that suits your risk tolerance. 4. Diversify your investments across asset classes. 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 excessive fees and taxes. 7. Keep costs low by choosing low-expense investments. 8

1. 10 Principles of the Bogleheads®
Investment philosophy
• Milwaukee Bogleheads
• September 11, 2017
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 explained 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. Where to Get More
Information
• http://www.bogleheads.org/wiki/Investment_policy_state
ment
• http://www.bogleheads.org/wiki/Video:Bogleheads®_inve
stment_philosophy