To stay a Boglehead, I have to leave

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
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Re: To stay a Boglehead, I have to leave

Post by Atgard » Wed Jun 18, 2014 7:48 pm

You make a good point. I think just because the idea of "age in bonds" in a two- or three-fund index portfolio is so darn simple and boring, there's nothing really for us to talk about. "Do I use this ETF with 0.06% fees or this other one with 0.05% fees?" So we nibble around the margins and try to make small tweaks and generally make it more complicated than it needs to be.

But there's a reason that 95% of people would be better served by the simple three-fund portfolio or a lifestyle fund, and call it a day and check back on it in 30 years.

And most of the remaining 5% would end up within a rounding error of the simple portfolio even with all their tweaks…

I do find it valuable to learn about some of the interesting advanced stuff… but I don't let it affect my portfolio on a daily basis. I just digest it all and don't make any rash moves. If you're constantly on the verge of adjusting your AA or buying some new sector based on a thread you just read, then yeah it's probably best to take what you learned already and say goodbye to Bogleheads and we'll see you (sitting pretty in retirement) in 30 years! :sharebeer

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Re: To stay a Boglehead, I have to leave

Post by stlutz » Wed Jun 18, 2014 8:05 pm

Kudos to the OP. If the forum is working, this is what most people who visit should do.

I think for a good number of the folks who post here a lot, the forum and their own personal investments are somewhat divorced from each other. I can't think of any portfolio changes I've really made because of a discussion here.

I like to read and post here mainly because I'm interested in markets, and how they work. The discussions here have changed my mind on a number of things over the years, but I really haven't taken any action as a result because a boglehead portfolio doesn't really demand it.

The big value of all of the debates/discussions here is that any google search on an investing issue ("are TIPS a good investment now", "When will the next market crash be?" etc.) will produce links high up in the results that point here. That's a good thing.

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Re: To stay a Boglehead, I have to leave

Post by hoppy08520 » Wed Jun 18, 2014 8:28 pm

rnitz wrote:<< snip >>

Second, I'd recommend a technique that has served me well since I've been using it. When I want to make a change (to a holding, an allocation, whatever) I do the analysis, compare the alternatives, make my decision, and then...

wait one year before implementing.

Very few significant decisions will be impaired by waiting a year (once you have the basics of a plan). However virtually all market timing based gut reactions will be destroyed by waiting a year. TIPS are hot - I've got to get into them! No, gold is the best diversifier! Better yet, commodities (or CCFs)! No, no, REITS are the diversifier! Int'l doesn't matter (Bogle said so). No, Bernstein said I've got to to be 50/50 Int'l... etc. etc. (apologies to those named, I know I'm exaggerating). Especially if you're young (under 35) a year is just a blink, and the delay will have virtually no appreciable effect (absent market timing effects, which you shouldn't be using anyway).

<< snip >>
This one-year "waiting period" is great advice, and I've followed it, if not that consciously. As you say, in the long run, a single non-drastic change is not going to make a big difference, and it can wait a year.

To the OP, I can relate to your post. This site can make your head spin because there are so many good ideas. Thanks to my own analysis paralysis and my deliberative nature, I have managed to resist mucking around with things, but it takes willpower.

I first shifted to a 3-fund portfolio around 3 years ago. I sat tight with that for at least 1.5 years. Influenced by this site, I ultimately decided to deviate from the 3-Fund portfolio by adding some tilts. But it took me almost a year to finally pull the trigger. During that year, I came up with various model portfolios, did a lot of reading, made a couple of posts to ask questions, etc. I also took a couple of months off to stop thinking about it. Then I came back to it and finally made the changes, but it was not a rash move.

That was 16 months ago and I've changed nothing since.

Lately, I'm being sorely tempted to make other changes, specifically increasing my international allocation from 70/30 US/Intl to 60/40 or 50/50. That's being driven by some current threads (Bernstein: A Decade of Super-Low Returns and investing international, why & how much) as well as prior threads here. I'm also tempted to add the Vanguard international bond fund.

Maybe I'll give myself a Jan 1, 2015 date on which to make the move or not. I'll keep thinking about it for the next six months. If the idea is still strong, then maybe I'll do it. Someone please remind me in six months in case I forget -- actually, don't -- if I forget about it, then the idea will have died on the vine, which is just as well.

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Re: To stay a Boglehead, I have to leave

Post by chameleon » Wed Jun 18, 2014 9:18 pm

One peculiar trait I see from a significant but vocal minority of the U.S. population is this need to constantly beat the drums of doom. I don't know if it's because people are stressed out and overworked in their personal lives or what but there is a pervasive negativity that reflects in various posts. The calls of the sky is falling and to sell all your stuff and put it into gold bars is a constant meme that's been going on since the '90s at least. The doom and gloom comparisons and predictions that the U.S. stock market is going to go to the way of Japan every other thread concerning the future is just a symptom of this existing negativity. I choose to ignore it because it's not really useful.

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Re: To stay a Boglehead, I have to leave

Post by ccieemeritus » Wed Jun 18, 2014 11:07 pm

Being a passive index fund investor is boring.

I fondly remember telling my parents to buy Nike when I was a teenager. They made some money on that one.
I made good money from my Intel ESPP when I worked there in the mid 90's.

Fun times.

But now I'm a believer in getting rich slowly by buying index funds and holding until retirement. Boring boring boring.
Smart smart smart. The right choice financially. But boring.

I'll have to find my excitement elsewhere.

If reading tempts you to do something more...exciting...with your money, feel free to avoid the website.
We won't take it personally. We promise.

Just remember that 95% of the members are the silent majority who would never invest in the last poster's wacky scheme. But there's only
so many ways to post "+1 for buying index funds and holding until retirement" before that gets boring too. I should put that
in my signature or something.

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Re: To stay a Boglehead, I have to leave

Post by Mursili » Wed Jun 18, 2014 11:55 pm

pennstater2005 wrote:... although for the most part the noise here at bogleheads is less damaging than outside noise. Good luck.
The OP thought he might go fishing. In that case, the "outside noise" might be better than the noise here on bogleheads. Listening to the wind in the trees is a great way to make money compounding.

While I am not tempted to change my asset allocations based on the threads here, I find that the many topics here take up too much of my time. There are so many other things to do than to read and contribute here. That leads to the problem of the fact that this place is so useful because of the time people spend making it informative.

Good luck to the OP.
When it comes to havoc, no one wreaks like me! - Dr. Heinz Doofenshmirtz

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Re: To stay a Boglehead, I have to leave

Post by wilked » Thu Jun 19, 2014 5:27 am

I haven't required investment advice from the site in a long time, but still hope to glean information from here to affect my biggest nemesis: taxes

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