A question for newbie Bogleheads

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tennisplyr
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A question for newbie Bogleheads

Post by tennisplyr »

For those of you relatively new to this forum, what would you say was the single biggest insight you gained about investing that you hadn't known or thought about before. You might call it the "aha moment".
Those who move forward with a happy spirit will find that things always work out.
daveydoo
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Re: A question for newbie Bogleheads

Post by daveydoo »

Finally "got" tax-loss harvesting (thanks to livesoft and a few others). I always understood it, but I never really internalized how to benefit from it and where/when to apply it.
"I mean, it's one banana, Michael...what could it cost? Ten dollars?"
corysold
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Re: A question for newbie Bogleheads

Post by corysold »

That I could do it myself, virtually for free, online with a few clicks, and likely get better results than I was paying an advisor for.
dbr
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Re: A question for newbie Bogleheads

Post by dbr »

Not a newbie, but I think the first thing I learned was understanding costs and the importance of costs. The second thing was a better grasp on the nature of different assets. A third thing is the entire concept of what goes on with retirement withdrawals. The ah-ha moment, among others, might have been the Trinity Study.
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KSOC
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Re: A question for newbie Bogleheads

Post by KSOC »

I learned how simple investing can be when you're not afraid of the process.
I listened to Dave Ramsey, read a few of his books. Debt bad. Ok. Credit cards bad. No, I use mine to my advantage and always pay off each cycle.
I listened to Ric Edelman, read a few books. Learned about fee's but you need to hold mucho funds. Really?
Stumbled onto Bogleheads, read "The Guide to Investing". Boom! Lights & Sirens came on. It was financial comfort food.
I was doing ok before, always saved. So I overhauled my retirements, my EF & opened an account at Vanguard.
I have a lot to learn yet and this website is my go to for everything money related.
But now I am confident in my plan, and how to make my dollars work.
Passing on to my daughters the Boglehead philosophy.
I'm just sitting here watching the wheels go round and round. | Nobody told me there'd be days like these.
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tennisplyr
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Re: A question for newbie Bogleheads

Post by tennisplyr »

Technically not that new, for me it is the importance of diversification and owning low cost funds.
Those who move forward with a happy spirit will find that things always work out.
ny_rn
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Re: A question for newbie Bogleheads

Post by ny_rn »

"Don't look for the needle. Buy the haystack." - John Bogle
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TinkerPDX
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Re: A question for newbie Bogleheads

Post by TinkerPDX »

Initially it was minimize costs, buy the market/diversify broadly.

Now that I have a few years under my belt (three with my IPS in place) I'd say the deeper "aha" is that it's more important to stick to the plan / stay the course than it is to have the "perfect" plan. Whenever I'm tempted to deviate, to buy off schedule, to try and buy a dip, etc., I remind myself that math and history say I'm most likely to do better if I do nothing.
Woodshark
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Re: A question for newbie Bogleheads

Post by Woodshark »

My a-ha moment was an amalgam of.......

1. You can expect a return of around 4% after inflation. If you give a financial planner "we only charge 2%" as a fee, you are giving away 50% of your earnings.

and

2. Quit trying to buy the next Apple stock or chasing last years top performing fund, just buy the market. In other words, don't bet on last years Super Bowl winner this year, just invest in the NFL.
Lou354
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Re: A question for newbie Bogleheads

Post by Lou354 »

Tax-efficient fund placement.
gus1961
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Re: A question for newbie Bogleheads

Post by gus1961 »

1) The simplicity of the 'Three Fund Portfolio' and how it will likely outperform any other combination either I or an advisor could come up with.
Other:
2) Why the Large Cap Value fund I had for decades, while a good performer, was not tax efficient.... high turnover = large annual taxable capital gains.
3) ^^^ How I could get similar long-term gains (Total Market stock fund) without the annual tax burden.
4) How maxing out my 401k contribution could have dropped me into a lower tax bracket, making the above gains non-taxable!
5) Why the advise of my previous Financial Advisor wasn't always the best route for ME.... buying/selling stocks = commissions for him and taxes for me.
6) Realized that, in the past, I had left a lot of money on the table....which Uncle Sam had then snatched a good portion from me.
7) Investing doesn't have to be a complicated, time consuming ordeal.
8) It's not too late to make changes and fix many of my earlier mistakes.

Finally, It's great to have the advise from the wealth of knowledge here, and for the SUPPORT they provide to back up some of the difficult decisions I had to make in fixing my portfolio. Thanks all!
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onthecusp
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Re: A question for newbie Bogleheads

Post by onthecusp »

I think I learned about all of the above! But what really hooked me here was the basic understanding of the role of bonds and asset allocation. I had always shied away from bonds, thinking in terms of corporate bonds.

The over riding importance of low fees as well. I thought I was avoiding them when I tried my hand at individual stocks a few years ago, but the lack of diversification really hurt my past returns.

Thanks to all the patient contributors here. :sharebeer
swguy
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Re: A question for newbie Bogleheads

Post by swguy »

Finding, lurking, and eventually joining the BH community helped me sort out my reasonably successful but unsustainable investing strategies and simplify them. It also helped us take a pragmatic look at where we were financially and gave us the confidence to follow goals we had set for early retirement.

Now, with IPS in hand and a far simpler portfolio to manage we enjoy life more and worry less.
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warowits
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Re: A question for newbie Bogleheads

Post by warowits »

-Buy index funds, and hold them until retirement.
-Fees matter
-Live below your means
-Don't fool yourself into believing you know something the market doesn't.
-Don't pay a fool who believes they know something the market doesn't.

These are all important, but the real break through is when you shift your thinking from cash flow, to net worth. Thinking just in terms of cash flow will have you spending every penny and thinking you did great because every bill was paid. But when you look at it from a net worth point of view everything changes.
pierremonfrere
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Re: A question for newbie Bogleheads

Post by pierremonfrere »

Fees matter.
And there is no need to pay someone to manage my money.

My first investment was into a fidelity freedom fund with an ER of .76

Now I have a weighted ER .09
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timboktoo
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Re: A question for newbie Bogleheads

Post by timboktoo »

The most important thing I learned here is that gentlemen still exist and that they always respond respectfully to others. This, I observed from Taylor's posts.

Some of the other things I learned here:
JasonA1987
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Re: A question for newbie Bogleheads

Post by JasonA1987 »

That expense ratio matters and that it is not hard, just read some and pay attention. Put down the financial advisor coolaid
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meowcat
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Re: A question for newbie Bogleheads

Post by meowcat »

One percent didn't seem like much. It sure does now!
More people should learn to tell their dollars where to go instead of asking them where they went. | -Roger Babson
BlackStrat
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Re: A question for newbie Bogleheads

Post by BlackStrat »

- keep it simple
- index funds (low cost)
- diversification
- asset allocation and rebalancing
- tax ramifications (for instance, keep bond holdings in tax-sheltered areas)
- not everyone out there can afford the seemingly prosperous lifestyle they live which is evident to others
CheeseFlip
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Re: A question for newbie Bogleheads

Post by CheeseFlip »

Oh, I learned that it's good to sell winners and buy losers *within a rational asset allocation.*

Also that there are smart folks here who are deeply generous with their time and knowledge.
10YearPlan
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Re: A question for newbie Bogleheads

Post by 10YearPlan »

This forum confirmed that what I had been doing (investing in low cost mutual funds, keeping it simple) was the right approach. However, prior to this forum, I had never once considered tax efficiency or tax loss harvesting. Still have many miles to go, but those were my first aha moments.
B3GINN3R
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Re: A question for newbie Bogleheads

Post by B3GINN3R »

For me it was when I realized that the only way to get wealth was to spend less than I earn. And, the lower percentage of my income i spend, the richer I get faster. Also, the best way to get more savings, is just to earn more money.
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Lieutenant.Columbo
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Re: A question for newbie Bogleheads

Post by Lieutenant.Columbo »

tennisplyr wrote:For those of you relatively new to this forum, what would you say was the single biggest insight you gained about investing that you hadn't known or thought about before. You might call it the "aha moment".
realizing that I did not have to work till age X if I saved enough to live on for the rest of my life before age X; till then (a year ago at age 45) I always assumed that investing was not really necessary in my case because (somehow, do not ask me why) I assumed I'd be working till old age so there'd be money coming in for a long long time :oops:
Lt. Columbo: Well, what do you know. Here I am talking with some of the smartest people in the world, and I didn't even notice!
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