What Experts Say About "Simplicity"

[Taylor Larimore]

Scott Adams, author of Dilbert: "I once tried to write a book about personal investing. After extensive research I realized I could describe everything that a young first-time investor needs to know on one page."

Antoine de Saint-Exupéry: "A designer knows he has achieved perfection not when there is nothing left to add, but when there is nothing left to take away."

Brett Arends, Award winning financial columnist: "Experts will say that as a rule the more complex the financial product, the worse a deal it is likely to be."

Christine Benz, Morningstar Director of Personal Finance: "Simplicity is one of the greatest--but in my view, woefully underrated--virtues when managing a portfolio."

Bill Bernstein, author of Four Pillars of Investing: ""The more real people I get to know, the more I am convinced the simpler the solution, the better the solution."

Richard Bernstein, Merrill Lynch strategist: "Investors find it hard to believe that ignoring the vast majority of investment noise might actually improve their performance."

Jack Bogle: "Simplicity is the master key to financial success. -- We ignore the real diamonds of simplicity, seeking instead the illusory rhinestones of complexity." "This business is all about simplicity and low cost. I'm not into all these market strategies and theories and cost-benefit analyses - all the bureaucracy that goes with business. In investing, strip all the baloney out of it, and give people what you promise." "Never underrate either the majesty of simplicity or its proven effectiveness as a long-term strategy for productive investing." "In the stock market the more elaborate and abstruse the mathematics the more uncertain and speculative are the conclusions we draw therefrom." "Yes, investing is simple. But it is not easy, for it requires discipline, patience, steadfastness, and that most uncommon of all gifts, common sense." "Don't look for the needle in the haystack. Just buy the haystack!"

The Boglehead's Three-Fund Portfolio: "A portfolio with fewer funds has many advantages: Lower costs, Fewer hidden turnover costs, Better tax effciency, Less distortion from contributions and withdrawals, Less rebalancing, Less chance of errors, Easier tax-preparation, Less paperwork, Less storage, Less stress, More free time with family and friends."

Dan Bortolotti, CFP, and author of The Money Sense Guide to the Perfect Portfolio: "The peace of mind that comes with a simple investing strategy is priceless."

Jack Brennan, former Vanguard CEO and author of Straight Talk on Investing: "It's in the interest of many financial service companies to make you think that investing is difficult.--It's really quite simple."

Warren Buffet: "To invest successfully, you need not understand beta, efficient markets, modern portfolio theory, option pricing or emerging markets. You may, in fact, be better off knowing nothing of these."

Scott Burns, creator of The Couch Potato Strategy: The advocates of complexity are generally people who are making their living from the complexity they create for us.”

Ben Carlson, author of A Wealth of Common Sense: ""I’ve spent my entire career working in portfolio management. This experience has taught me that less is always more when making investment decisions. Simplicity trumps complexity."

"Charles B. Carlson, financial author: "One of the best pieces of advice I've ever received when it comes to investing is the "KISS" concept (Keep It Simple Stupid)."

Jean Chatzky, NBC Financial Editor: "The problem with so much personal financial advice is that it's unnecessarily complicated, often with the goal of selling you something you don't need."

Andrew Clarke, author of "Wealth of Experience": "In investing, simple is usually more productive than complex."

Jonathan Clements, Wall Street Journal columnist: "Investing is simple. To be sure, you can make it ludicrously complicated."

J.L.Collins, author of The Simple Path to Wealth: The more complex an investment is, the less likely it is to be profitable. At best they are costly. At worst they are a cesspool of swindlers.

Paul Crafter, author of "Investment Guide": "After doing it all, I now feel I've come around in a complete circle, ending up with this: The more I learn, the less I really need to know."

James Dahle, Editor of The White-Coat Investor: "In my view, the simpler the financial product, the better it is for the consumer."

Edsger Dijkstra, computer scientist: “Simplicity is a great virtue but it requires hard work to achieve it and education to appreciate it. And to make matters worse: complexity sells better.”

Laura Dogu, Ambassador to Nicaragua and co-author of "The Bogleheads Guide to Retirement Planning": A simple portfolio is actually the ultimate in sophistication. It almost always lowers cost (including taxes), makes analysis easier, simplifies rebalancing, simplifies tax-preparation, reduces paper-work and record-keeping, and enables caregivers and heirs to easily take-over the portfolio when necessary. Best of all, a simple portfolio allows the investor to spend more time with family and friends."

Michael Edesess, author of The Big Investment Lie: "As a mathematician I know when mathematical-sounding analyses are little more than elaborate sales pitches, designed to thoroughly obscure the simple fact that smart investing is non-mathematical and accessible to everyone."

Albert Einstein: "The five ascending levels of intellect are: smart, intelligent, brilliant, genius, simple."

Charles Ellis, co-author of "The Elements of Investing": "KISS investing--Keep It Simple, Sweetheart--is the best and easiest and lowest cost and worry-free way to invest for retirement security."

Javier Estrada Ph.D., Professor of finance: "Simplicity is often underrated; simple static strategies (balanced portfolios) have been shown to perform as well as—and often better than—more complex strategies in a wide variety of settings."

Paul Farrell, author of "The Lazy Person's Guide to Investing": "Perhaps the most amazing insight I got out of this review of the investment habits of Nobel laureates is the simplicity of their investing strategies."

Rick Ferri, CFA, advisor, and author of six financial books:[/i] "Don’t assume that a complex strategy is better than a simple strategy. The only thing extra complexity is likely to add is extra cost." -- "Complexity is the third stage in the education of an index investor; Simplicity is the fourth and final stage."

The Finance Buff: "Making fewer decisions usually leads to better results than making more decisions."

Future Metrics looked at the performance of 224 pension plans over about 14 years compared with the performance of 60% S&P 500 index and 40% aggregate bond index benchmark. Of those 224 plans, only 19 beat that simple benchmark.

Gensler & Baer, authors of "The Great Mutual Fund Trap": "If you simply buy and hold you don't need to read investing magazines, watch financial news networks, subscribe to newsletters, or pay a broker to execute new trades."

Benjamin Graham, author, teacher, famed investor: "If you merely try to bring just a little extra knowledge and cleverness to bear upon your investment program, instead of realizing a little better than normal results, you may well find that you have done worse. -- In the stock market, the more elaborate and abstruse the mathematics, the more uncertain and speculative are the conclusions we draw therefrom."

Wesley Gray PhD, Editor of Alpha Architect: "Complexity is often a smokescreen that hides a conflict of interest."

Alan Greenspan, former Chairman of the Federal Reserve: "This decade is strewn with examples of bright people who thought they built a better mousetrap that could consistently extract abnormal returns from financial markets. Some succeed for a time. But while there may occasionally be misconfigurations among market prices that allow abnormal returns, they do not persist."

Morgan Housel: financial columnist for Wall Street Journal and Motley Fool's "Simple almost always beats complex."

Daniel Kahneman, Nobel Laureate: "All of us would be better investors if we just made fewer decisions"

Edmund Kean: "Complexity is easy. Simplicity is hard."

Kiplinger: "The big secret to successful investing is that it's actually not all that complicated. Most of the mumbo jumbo doesn't matter."

Darrow Kirkpatrick, author of Retiring Sooner: "In financial life, you should run from complexity, and run toward simplicity."

Michael LeBoeuf, author of "The Millionaire in You": Simplicity in investing does not generate fees and commissions. That's the problem financial salespeople have so they try to make investing seem complicated.

Bruce Lee: "One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity"

Leonardo da Vinci: “Simplicity is the ultimate sophistication.”

Henry Wadsworth Longfellow: "In character, in manner, in style, in all things, the supreme excellence is simplicity."

Peter Lynch, legendary fund manager: "If you spend more than fifteen minutes a year worrying about the market, you've wasted twelve minutes."

MIT Study: "The less well-informed group did far better than the group that was given all the financial news."

Scott MacKillop, CEO First Ascent Asset Management: " People who don’t know any better equate complexity with sophistication. But truly it takes more sophistication to build elegantly simple portfolios."

Joe Maglia, CEO TD Ameritrade: "Wall Street goes out of its way to make investing incredibly sophisticated and complex because they can make a tremendous amount of money by doing so."

Burton Malkiel, author of "Random Walk Down Wall Street": "The overarching rule for achieving financial security: Keep it simple. -- The most important financial advice is stunningly simple and fits on an index card."

John Markese, CEO of American Association of Individual Investors: "If you have more than eight funds you should slap yourself."

Wm McNabb, Vanguard CEO: "If you can't understand an investment product in five minutes, walk away."

Eric McWhinnie, chief analyst, Wall Street Cheat Sheet: "Keep your investment strategy simple and steer clear of complicated vehicles that are designed to benefit the people selling them."

Paul Merriman, author and former fund manager: "There's always somebody with a story or strategy that's newer or seems much better."

James Montier, author of The Little Book of Behavioral Investing : "Never underestimate the value of doing nothing."

Morningstar Guide to Mutual Funds: "Good investing doesn't have to be complicated. In fact, simplification may lead to better investment results."

Motley Fools: "In the world of personal finance, fancier or more complex is not usually better."

Charles Munger, Vice President, Berkshire Hathaway: "Where there is complexity there is by nature fraud and mistakes."

David Nadig, president of Index Universe's ETF Analytics: "Most investors—myself included—are better off the simpler we keep things."

Issac Newton: “Truth is ever to be found in the simplicity, and not in the multiplicity and confusion of things.”

Suze Orman: "We make investing so complicated and it really is not."

Mike Piper, financial author: "There's an entire industry built on convincing us that investing is complicated."

Bob Pisani, CNBC: "Increasing complexity does not decrease risk, it increases risk."

Jane Bryant Quinn, syndicated columnist and author of "Smart and Simple Financial Strategies": "You shouldn't buy anything too complex to explain to the average 12-year old."

Anna Pryor Wall Street Journal writer: "It may sound counter-intuitive, but for the average individual investor, less is actually more."

John Rekenthaler, Morningstar Research Director: "How many funds should you have? Four to six should do.-- A complex investment strategy, with many moving parts, means more wheels that are stuck at any given time, leading to more questions and more uncertainty."

Rodc on Bogleheads Forum: "While doing this financial engineering my wife who does no math just shook her head at my optimization games and said, 'Rod, life is uncertain, get over it.' After a lot of work, I discovered much to my surprise, she was right."

Allan Roth, CFP, CPA, author and advisor: "If you’re thinking complexities such as smart beta and the like will best simplicity, think again."

Paul Samuelson, Nobel Laureate: "Investing should be like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas."

Bill Schulthies, author of "The Coffeehouse Investor": "When you simplify your investment decisions, not only do you enrich your life by spending more time on families, friends and careers, but you enhance portfolio returns in the process."

Chandon Sengupta, author of "The Only Proven Road to Investment Success": "There is overwhelming evidence that the simplest possible investment method works much better than all the other more complex ones."

Wm. Sharpe, Nobel Laureate: "Smart Beta ? Hearing it makes me sick."

George Sisti, CFP, editor of "Vectors": "In investing, unlike other endeavors, being smart and working extra hard doesn’t result in better outcomes, usually just the opposite."

Larry Swedroe, author of "The Successful Investor Today": "The more complex the investment, the faster you should run away."

David Swensen, Yale Chief Investment Officer: "As a general rule of thumb, the more complexity that exists in a Wall Street creation, the faster and farther investors should run."

Nassim Taleb, hedge fund manager and author of The Black Swan: "Don't be enticed by complex investment products that are created by incomprehensible mathematics."

Peter Di Teresa, Senior Analyst, Morningstar: "It usually takes a long time for investors to become sophisticated enough to realize how simple investing can be."

Andrew Tobias, author of The Only Investment Guide You Will Ever Need: "I believe in selecting the most straightforward and easiest-to-implement strategy for achieving our goals."

Henry David Thoreau: “Our life is frittered away by detail. Simplify, simplify.”

Tweddell and Pierce, authors of "Winning with Index Mutual Funds": "Keep it simple. Investment success depends on asset allocation, diversification, and risk management, not on complexity."

Eric Tyson, author of "Mutual Funds for Dummies:" "Planners may try to make it all so complicated that you believe you can't possibly manage your finances or make major financial decisions without them."

Walter Updegrave, Editor of Money magazine: "Simpler is better. Ignore the siren song of sophisticated investments"

Richard Young, author of "The Intelligence Report": "If you can't run your portfolio taking 60 minutes a month, it's too complicated."

Karen Wallace, Morningstar senior editor: "Having fewer accounts can help you streamline your monitoring and rebalancing efforts. And having your assets in one place can allow you to better assess your overall asset mix.

Jason Zweig, Wall Street Journal columnist and author of "The Intelligent Investor": "The less you fool with your portfolio, the less often you'll play the fool."

Warren Buffett: "There seems to be some perverse human characteristic that likes to make easy things difficult."

What Experts Say About Other Important Topics

Best wishes.
Taylor

[Texas Radio]

I love these kind of posts

[Miriam2]

Thank you Taylor for bringing us back to the roots.
I especially like this one:

Laura Dogu, co-auther of "The Bogleheads Guide to Retirement Planning": A simple portfolio is actually the ultimate in sophistication. It almost always lowers cost (including taxes), makes analysis easier, simplifies rebalancing, simplifies tax-preparation, reduces paper-work and record-keeping, and enables caregivers and heirs to easily take-over the portfolio when necessary. Best of all, a simple portfolio allows the investor to spend more time with family and friends."

.

[Taylor Larimore]

Thank you Taylor for bringing us back to the roots.
I especially like this one:

Laura Dogu, co-auther of "The Bogleheads Guide to Retirement Planning": A simple portfolio is actually the ultimate in sophistication. It almost always lowers cost (including taxes), makes analysis easier, simplifies rebalancing, simplifies tax-preparation, reduces paper-work and record-keeping, and enables caregivers and heirs to easily take-over the portfolio when necessary. Best of all, a simple portfolio allows the investor to spend more time with family and friends."

.

Miriam:

In addition to her valuable contributions, Laura has a wonderful way of distilling many ideas into a minimum of words. It is one of the reasons she was voted Queen of the Bogleheads at one of our annual conferences.

Best wishes.
Taylor

[jimkinny]

Thanks Taylor,

It took me awhile, but with your persistence, I finally came around and learned enough to keep things simple.

Jim

[Norris]

Thanks, Taylor. Always good stuff, as per usual. I especially got a kick out of Einstein's "The five ascending levels of intellect are: smart, intelligent, brilliant, genius, simple." I love it!

Norris

[Crushtheturtle]

"Everything should be kept as simple as possible, but no simpler."
-Einstein

[LadyGeek]

This thread is a 1 of 8 birthday presents from Taylor Larimore: What Experts Say [about various investing topics]

[sharukh]

Credit: thefinancebuff.com - Friday mails.

Solving Hard Problems With Simple Ideas by Morgan Housel at Collaborative Fund
http://www.collaborativefund.com/blog/s ... ple-ideas/

A simple idea is easier to follow consistently. The consistency makes for times when the simple idea isn't "the best."

Thanks again.

[Fallible]

Credit: thefinancebuff.com - Friday mails.

Solving Hard Problems With Simple Ideas by Morgan Housel at Collaborative Fund
http://www.collaborativefund.com/blog/s ... ple-ideas/

A simple idea is easier to follow consistently. The consistency makes for times when the simple idea isn't "the best."

Thanks again.

Thanks. Another good one from Morgan Housel.

It seems the baseball, chess, and Munger/Buffett examples all depended on an extraordinary combination of talent and experience that enabled them to concentrate, or know almost instinctively, what was most important in their professions and, thus, to not waste time on what was not. It's similar to, or perhaps the same as, the "expert intuition" psychologist Daniel Kahneman has written about. I liked de Groot's examples in chess (boldface mine):

After four moves apiece there are a quarter trillion possible chess combinations. No one, of course, can calculate a meaningful percentage of them. So the masters don’t even try. In his book Thought and Choice in Chess, de Groot showed that pretty good chess players attempt to calculate multiple moves in their head, while masters simply contextualize moves into a broad, rules-of-thumb strategy that zeros in on the board’s top few challenges. He wrote:

Although master level players – as one would expect – more often selected winning moves than lesser players, their thinking and decision making followed similar procedural lines. The main difference between grandmasters and players of average strength is the speed of recognizing the central issue in each position. Where lesser players tend to spend considerable time on unimportant options, the best players almost immediately see what the real problem is. That’s their talent. … knowledge and experience rather than a strong computational competence or an exceptional memory.

[pkcrafter]

Credit: thefinancebuff.com - Friday mails.

Solving Hard Problems With Simple Ideas by Morgan Housel at Collaborative Fund
http://www.collaborativefund.com/blog/s ... ple-ideas/

A simple idea is easier to follow consistently. The consistency makes for times when the simple idea isn't "the best."

Thanks again.

Thanks, that is a great article.
---------------------------------------------

Norris wrote:

Thanks, Taylor. Always good stuff, as per usual. I especially got a kick out of Einstein's "The five ascending levels of intellect are: smart, intelligent, brilliant, genius, simple." I love it!

Hmm, I must be very intellectual because I skipped the first four.

Paul

[FrugalInvestor]

Here's the conclusion of a recent Market Watch opinion article written by Ben Carlson who is quoted in Taylor's initial post. The article is titled "A lesson in investing simplicity: Why the Bogle Model beats the Yale Model"..........

This has nothing to do with active vs. passive investing. This is all about simple vs. complex, operationally efficient investment programs vs. operationally inefficient investment programs and high-probability portfolios vs. low-probability portfolios. Investing is hard enough as it is before introducing a complex, inefficient, low-probability investment style.

That’s why the simple, efficient, high-probability Bogle Model wins.

Link to article.....
https://www.marketwatch.com/story/a-les ... 2017-02-06

[rgs92]

Awesome post. Thanks a million Taylor!

[DavidRoseMountain]

I agree with the simplicity concept, but the tax law is complex, and sometimes during the working years one is just going to have to have multiple tax-deferred accounts in order to optimize tax savings and portfolio growth.

[Norris]

Credit: thefinancebuff.com - Friday mails.

Solving Hard Problems With Simple Ideas by Morgan Housel at Collaborative Fund
http://www.collaborativefund.com/blog/s ... ple-ideas/

A simple idea is easier to follow consistently. The consistency makes for times when the simple idea isn't "the best."

Thanks again.

Thanks, that is a great article.
---------------------------------------------

Norris wrote:

Thanks, Taylor. Always good stuff, as per usual. I especially got a kick out of Einstein's "The five ascending levels of intellect are: smart, intelligent, brilliant, genius, simple." I love it!

Hmm, I must be very intellectual because I skipped the first four.

Paul

LOL Me too

Norris

[Snarfanio]

Thanks Taylor!!! Your list and others you have posted over the years should be required reading for high school students and MBA's alike.

[rec7]

Reminds me of a Boglehead that only had an account at Vanguard and a local credit union. Boy did that sound good so simple but yet so good.

[david99]

As Henry David Thoreau said in Walden, “Our life is frittered away by detail. Simplify, simplify, simplify! I say, let your affairs be as two or three, and not a hundred or a thousand; instead of a million count half a dozen, and keep your accounts on your thumb-nail.”

I think that in this era of the computer people think that everything has to be complex. I saw a commercial that said that you wouldn't do surgery on yourself so why would you want to manage your own finances. Lets face it complexity sells better than simplicity. You are not going to see an ad saying that investing is simple and we can easily do it with a three fund portfolio that is re-balanced once a year.

Thanks,
Taylor

[birdog]

The move to simplicity in my life has been important for a couple of reasons. The first being that it is almost always the better and more efficient route. Second, I find my memory isn’t what it used to be and I’m no longer as capable of maintaining the levels of complexity that I used to be able to. I doubt this second reason will improve as I continue to age.

[Fallible]

...
Lets face it complexity sells better than simplicity. ...

And no one knows that better than Wall Street with its ridiculousy complex jargon. WSJ columnist Jason Zweig has said of that jargon:

Wall Street has a particular fetish for inventing unnecessarily complicated ways of achieving simple goals. Most other professions, so far as I can tell, are more comfortable offering simple ways to do simple things. On Wall Street, complicated ways to do simple things have bigger payoffs — for Wall Street, that is. So complexity proliferates, and it gets encrusted with jargon to impress investors into thinking there’s something special about it.

[guyesmith]

Reminds me of a Boglehead that only had an account at Vanguard and a local credit union. Boy did that sound good so simple but yet so good.

This is what my wife and I do. Vanguard and local bank. That's it. Simple Simple Simple.

[lostdog]

Reminds me of a Boglehead that only had an account at Vanguard and a local credit union. Boy did that sound good so simple but yet so good.

This is what my wife and I do. Vanguard and local bank. That's it. Simple Simple Simple.

We have a checking account at our local credit union and invest with Vanguard. That's it...Simple.

[alexfoo39]

my apology.

I was drawn to this because of the simplicity model of investing. I can foresee that in later years when there are too many things to be handled, investing is the last thing I want to have those nuts and bolts.

Hence the three-fund portfolio with rebalancing is beautiful because of its simplicity, and that I can explain to almost everyone in a short time.

In academic research, we have this thing called 'parsimony'. It means if there's a model that explains something with the same explanatory power with fewer variables, that model will be favored. If investment can be summed up with a few key things, it is work, save, invest with low-cost, diversified fund, 50/50 AA, rebalance yearly, stay the course.

Amazing I can summarise my investment strategy in one sentence

[columbia]

One could do a lot worse than spending 30-40 years putting half in bonds, half in stocks and rebalancing every few years.

[longinvest]

We had a three-ETF then a four-ETF portfolio (similar to Taylor's Three-Fund Portfolio, but using Canada as home country and adding inflation-indexed bonds into the mix). I thought that it was simple, until I tried to teach my wife over a period of 5 years how to manage her own accounts.

The allocation was extremely simple: an equal weighting (25/25/25/25) of the four ETFs (50/50 stocks bonds). To minimize the number of holdings (she has 4 distinct accounts, including one taxable account, one tax-free account, and two tax-deferred accounts that can't be combined due to regulations), the ETFs were allocated by first putting bonds into tax-deferred accounts, then putting stocks in the remaining space (tax-deferred, tax-free, and taxable). This allowed to keep her number of holdings down to 7, instead of 16 holdings if she had used a mirror allocation in all accounts. According to some people, this was supposed to be more tax efficient (but I now seriously doubt this, due to the complex mathematics involved in properly assessing the lifelong impact of asset allocation across accounts with distinct tax features and the uncertainty of future tax changes). This also reduced the number of transactions to contribute to her portfolio and rebalance it.

But, it was too complex for my wife. I had to build a spreadsheet for her to be able to calculate contribution and rebalancing transactions. After 5 years, it became clear that she still had trouble understanding the distinction between a nominal and an inflation-indexed bond, and she would have trouble managing her portfolio if I passed away and the spreadsheet stopped working.

So, we've simplified our portfolio, a few months ago, to a single all-in-one globally-diversified balanced index ETF (VBAL) of Vanguard Canada, similar to the US Vanguard LifeStrategy Moderate Growth Fund (VSMGX) except for a Canadian home bias (instead of a US home bias). The ETF has been carefully designed by Vanguard Canada to be tax-efficient in both taxable and tax-advantaged accounts. As a result, my wife now has a single identical ETF in each of her four accounts. She doesn't need to rebalance her portfolio, as the ETF automatically rebalances itself. My own accounts are identically allocated. As she's had ample practice by now making limit transactions to buy and sell ETFs, I'm finally confident that she'll be able to continue managing the portfolio if I leave before her.

Luckily, our taxable accounts were small enough for the switch to have minimal tax consequences (zero impact for her, small-enough for me). It would have been costly to do such a change later, after taxable accounts had accumulated significant unrealized capital gains.

The more I learn, the more I realize the value of simplicity.

[bertilak]

I just reread the first post here. It is an amazing collection of wisdom.

As an engineer/programmer, one quote jumped out at me:

Antoine de Saint-Exupéry: "A designer knows he has achieved perfection not when there is nothing left to add, but when there is nothing left to take away."

Undeniably true in my field. Both academic practical progress has generally been in ways to simplify things.

[bobcat2]

"Every complex problem has a solution which is simple, direct, plausible—and wrong." - H. L. Mencken

"Everything should be made as simple as possible, but not simpler." - Albert Einstein


BobK

[bertilak]

"Every complex problem has a solution which is simple, direct, plausible—and wrong." - H. L. Mencken

"Everything should be made as simple as possible, but not simpler." - Albert Einstein


BobK

Wait a minute!

Who's the contrarian here?

I agree there are many simple answers that are simply wrong. Some things are inherently complex, but that doesn't mean that the best, practical, response to that complexity is to ADD complexity.

[A440]

My NJ plan (AmeriHealth Administrators EPO) only covers in-network in NJ and hospitals in Philly that have satellite offices in NJ (e.g. Penn Med and CHOP). However, it also has a PHCS Travel Network (on the back of the insurance card) that provides coverage for out of state. Not sure how it works, because thankfully, I've never had to use it. Does your health plan have something similar available to you?

[LadyGeek]

^^^ Hi, this thread is for investing. Perhaps you meant to post that somewhere else?

[bobcat2]

"Every complex problem has a solution which is simple, direct, plausible—and wrong." - H. L. Mencken

"Everything should be made as simple as possible, but not simpler." - Albert Einstein

Wait a minute!

Who's the contrarian here?

I agree there are many simple answers that are simply wrong. Some things are inherently complex, but that doesn't mean that the best, practical, response to that complexity is to ADD complexity.

I agree that one shouldn't add unneeded complexity. But it seems to me that many posters at Bogleheads are confusing simplistic with making things simpler. They are not at all the same thing. Often the danger is in the allure of the simplistic - not making things too complex.

BobK

[DaufuskieNate]

“For the simplicity on this side of complexity, I wouldn't give you a fig. But for the simplicity on the other side of complexity, for that I would give you anything I have.”

― Oliver Wendell Holmes

[secondopinion]

"Every complex problem has a solution which is simple, direct, plausible—and wrong." - H. L. Mencken

"Everything should be made as simple as possible, but not simpler." - Albert Einstein

Wait a minute!

Who's the contrarian here?

I agree there are many simple answers that are simply wrong. Some things are inherently complex, but that doesn't mean that the best, practical, response to that complexity is to ADD complexity.

I agree that one shouldn't add unneeded complexity. But it seems to me that many posters at Bogleheads are confusing simplistic with making things simpler. They are not at all the same thing. Often the danger is in the allure of the simplistic - not making things too complex.

BobK

Right. Being from a background of statistics/mathematics, I learned that one has to strike the balance between simplicity and accuracy with models. Too simple of models causes the model to be inaccurate; too many cause the model to be intractable. The quote of Einstein is right on simplicity; it should be as simple as practical. The 1-, 2-, 3-, 4-fund idea does not work for everyone; the average investor is not every investor. If the portfolio cannot well approximate the investor's goals, then it is wrong portfolio despite how many funds it does not have.

No, I do not have only a few ETFs. But as long as I make it simple enough while meeting my goals, it is good enough for me. If 1 fund is needed, take 1. If 10 funds are needed, take 10.

This reply might firestorm, but I have learned from my investment experience that too complex and too simple are both wrong.

[bertilak]

Taylor's simplicity link had one quote that struck me:

• MIT Study: "The less well-informed group did far better than the group that was given all the financial news."

All that information makes one feel A) there is a NEED to act and, having received that information, B) one feels qualified to act.

Both A and B are wrong.

I was also reminded of one of my favorite words: abstruse. As a software engineer, I learned that the best programmers avoid abstruseness like the plague.

[Walkure]

"Every complex problem has a solution which is simple, direct, plausible—and wrong." - H. L. Mencken

"Everything should be made as simple as possible, but not simpler." - Albert Einstein


BobK

Wait a minute!

Who's the contrarian here?

I agree there are many simple answers that are simply wrong. Some things are inherently complex, but that doesn't mean that the best, practical, response to that complexity is to ADD complexity.

I was thinking about this last night in the context of the old adage to "never invest in something you can't understand," realizing there are two different kinds of complexity:
1. The investment vehicle itself is straightforward and low-cost/low-commission but describing the underlying risk/return mechanics requires higher level math (options, futures, etc.) These are at least theoretically tractable to further study.
2. The underlying investment mechanics are simple but the product wrapper has been structured to intentionally resist comprehension (whole life, variable annuities, etc.) Run, don't walk, away from these; the complexity is concealing someone else's profit.

[Fallible]

I just re-read Taylor’s simplicity “gems” from the experts who, being experts, understand the complexities - the essence - of their profession, putting them in position to recognize, appreciate, and state that essence simply. Jack Bogle is a great example of this, using his deep knowledge and experience to simply describe the relative complexities of indexing: low cost, tax efficient, long-term, etc.

Likewise, the best teachers who truly understand their subjects can explain complexities in simple terms that students are more likely to understand and learn - and enjoy.

It may not be, but it feels akin to “expert intuition” that psychologist Daniel Kahneman has written about. Something can be quickly, correctly, and simply intuited because the person has acquired the experience and knowledge.

In all cases, it's about deep understanding of complexities that allow us to distill their essence into simplicities. Without that understanding, what appears on the outside to be simple (e.g., few words, small words, short sentences, brief descriptions, etc.) is unlikely to be simplicity.

[Ed 2]

Thank you! We need this constant reminder one’s in a while. . Just like Jack Bogle used to come on CNBC couple of time a year and this was refreshing.