Simple Path to Wealth
JL Collins

Summary

Great book on how to create wealth simply for decades. Well written and JL Collins does a good job explaining in simple terms how to invest in your future and manage your personal finances

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Notes

Spend less than you earn, invest the surplus and avoid debt

Never marry or give a fiscally irresponsible person access to your money

The greater percentage of income you save and invest, the sooner you’ll have fuck you money

Try saving and investing 50% of your income

If you can live on 4% of your investments per year, you are financially independent

Stock picking is a sucker’s game

If it sounds too good to be true, it is

If your interest rate on debt is less than 3%, put money into investments. If it’s more than 5%, pay it off ASAP

Paying off your debt should be your first priority

Invest, re-invest what it earns and re-invest what that earns

Vanguard’s total stock market index fund VTSAX

The most useful and powerful tool to navigate the world is money

There is no way to time the market!

Just put your money away and let it ride, as soon as the market crashes, put in more

Stay the course with a side-dish of panic

1% of active traders outperform the market the more frequently you trade, the worse you’ll do

Stocks: VTSAX (vanguard stocks)

Bonds: VBTLX (vanguard bonds)

No one will ever beat the market so never think fund managers will do it

Bonds = bad during inflating times and good during deflating times

Put all your eggs in the investing basket and forget about it

Put 100% of your assets into stocks when trying to build wealth 

VFWAX - FTSE all-world ex-US index fund

VTIAX - total international stock fund

Look at TRFs (target retirement funds) that are around the age you’ll retire

Need a min 10k for vanguard VTSAX so invest in total vanguard stock market index portfolio (VT vanguard total stocks ETF)

The difference between 1% and 2% in fees over your lifetime is hundreds of thousands of dollars. Don’t invest with an investment advisor

10% in bonds and 90% in low cost index funds

Everybody can be conned

Withdrawing 3% or less annually is a sure bet to still growing

Everything you want is on the other side of fear - Jack Cantfield

If you’re financially independent, invest 100% of your earnings to grow your nest egg

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