"Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

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Taylor Larimore
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"Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Taylor Larimore » Sun Sep 08, 2019 2:01 pm

Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
"Simplicity is the master key to financial success." -- Jack Bogle

schooner
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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by schooner » Sun Sep 08, 2019 2:13 pm

Thanks for posting! Buffett discusses this in his 2013 Annual Letter:

“both individuals and institutions will constantly be urged to be active by those who profit from giving advice or effecting transactions. The resulting frictional costs can be huge and, for investors in aggregate, devoid of benefit. So ignore the chatter, keep your costs minimal.”

A good reminder to keep it simple and minimize costs, and ignore the chatter (even on this forum :-).

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Ferdinand2014 » Sun Sep 08, 2019 2:27 pm

:sharebeer

My IPS is enough cash (T-Bills) to sleep well at night. The rest of my investment goes into a super low cost S&P 500 index fund (FXAIX - Fido 500 index). I do not keep an AA, but instead keep an X number that works out to at least 2 years of emergency fund - living expenses and extra for large expenses over the next 1-3 years. This keeps me from ever having to rebalance and one fund keeps me from making behavioral mistakes by fiddling with an AA. Warren Buffett has made it clear that 10% is a rough guideline and that you should keep enough short term treasuries so you are comfortable, whatever that may be. Some may disagree with the short treasuries duration and others (probably most) would disagree with lack of international. It has worked well for me and I fully understand there may be periods where I will underperform international. My costs are just about zero as T-Bills at auction and on auto-roll at Fidelity are free and FXAIX has an ER of 0.015, so I at least know I will get whatever the S&P 500 gives me.
“You only find out who is swimming naked when the tide goes out.“ — Warren Buffett

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by mhalley » Sun Sep 08, 2019 2:45 pm

If you have a huge net worth, you can have 10% in bonds without having to worry about stock volatility because that gives you enough money to live on, so you don’t have to worry about sequence of returns risk, bucket strategies, bond percent by age etc. Nice to be in the .0001%

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by schooner » Sun Sep 08, 2019 3:02 pm

mhalley wrote:
Sun Sep 08, 2019 2:45 pm
If you have a huge net worth, you can have 10% in bonds without having to worry about stock volatility because that gives you enough money to live on, so you don’t have to worry about sequence of returns risk, bucket strategies, bond percent by age etc. Nice to be in the .0001%
I second Ferdinand’s approach - the percentage is less important than the spirit of the advice (I think Bogle was 50/50 and Bogleheads have a 3-fund). All very, very cheap, market weighted index funds.

Warren Buffett joked he would give every new investor a 20 slot punch card, with every investment choice a punch. And it would have to last your entire life. You’d really think about each choice.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by nedsaid » Sun Sep 08, 2019 5:52 pm

Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
A fool and his money are good for business.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by indexfundfan » Sun Sep 08, 2019 5:55 pm

Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
And the other 10% in short term government bonds, not intermediate nor long term bonds.
My signature has been deleted.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by willthrill81 » Sun Sep 08, 2019 6:04 pm

nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by nedsaid » Sun Sep 08, 2019 6:11 pm

willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
Not only that, Buffett isn't going to disclose the details of his estate plans. This all is based upon one comment he made regarding a trust set up for his wife. We really don't know what his estate plan is except the comment about the trust and that most of his Berkshire-Hathaway stock will go to the Gates Foundation upon death. I wouldn't base my estate planning based upon an off the cuff comment by Buffett.
A fool and his money are good for business.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by schooner » Sun Sep 08, 2019 6:14 pm

willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
Ha, maybe. But why does he have billions of dollars? He didn’t inherit it. He built a career investing. And he has unbiased advice for the rest of us. He’s not trying to sell us some wacky mutual fund or ETF. He’s not selling “advisory services.” Heck, he’s not even saying to invest in Berkshire Hathaway.

And remember, this is applies to your long-term investment account. Your emergency fund doesn’t apply. Nor the savings account you use to plan a big upcoming purchase. He’s not saying do this for those pots of money.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by willthrill81 » Sun Sep 08, 2019 6:14 pm

nedsaid wrote:
Sun Sep 08, 2019 6:11 pm
I wouldn't base my estate planning based upon an off the cuff comment by Buffett.
Me neither.

Expanding that a bit, I would not base any aspect of my finances on what any one person, regardless as to how much I admired and trusted that person, said. That includes Bogle himself.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by tibbitts » Sun Sep 08, 2019 6:16 pm

nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
+1
It's important to point out that the 90/10 advice isn't applicable to typical investors - not even Bogleheads.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by tibbitts » Sun Sep 08, 2019 6:19 pm

schooner wrote:
Sun Sep 08, 2019 6:14 pm
willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
Ha, maybe. But why does he have billions of dollars? He didn’t inherit it. He built a career investing. And he has unbiased advice for the rest of us. He’s not trying to sell us some wacky mutual fund or ETF. He’s not selling “advisory services.” Heck, he’s not even saying to invest in Berkshire Hathaway.

And remember, this is applies to your long-term investment account. Your emergency fund doesn’t apply. Nor the savings account you use to plan a big upcoming purchase. He’s not saying do this for those pots of money.
But in reality it only applies to an indefinite-term investment, not a situation where you are possibly going to be depleting the account within a human lifetime. That 10% in his account could cover a minor blip like a multi-hundred-year equity market downturn.

schooner
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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by schooner » Sun Sep 08, 2019 6:25 pm

tibbitts wrote:
Sun Sep 08, 2019 6:19 pm
schooner wrote:
Sun Sep 08, 2019 6:14 pm
willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
Ha, maybe. But why does he have billions of dollars? He didn’t inherit it. He built a career investing. And he has unbiased advice for the rest of us. He’s not trying to sell us some wacky mutual fund or ETF. He’s not selling “advisory services.” Heck, he’s not even saying to invest in Berkshire Hathaway.

And remember, this is applies to your long-term investment account. Your emergency fund doesn’t apply. Nor the savings account you use to plan a big upcoming purchase. He’s not saying do this for those pots of money.
But in reality it only applies to an indefinite-term investment, not a situation where you are possibly going to be depleting the account within a human lifetime. That 10% in his account could cover a minor blip like a multi-hundred-year equity market downturn.
He is pretty clear in his 2013 Annual Letter. It’s just some unsolicited advice. We can choose to take it or leave it :-)

Trader Joe
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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Trader Joe » Sun Sep 08, 2019 6:54 pm

Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Thank you for posting this Taylor. I also only invest in VFIAX and I am very happy.

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oldzey
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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by oldzey » Sun Sep 08, 2019 7:07 pm

Warren Buffett has pledged to give away 99% or more of his wealth, according to his statement at The Giving Pledge.

Mr. Buffett has a net worth of US $80.8 billion as of September 8, 2019: https://www.forbes.com/profile/warren-b ... 16354b4639

So, he plans to keep 1% of $80.8B to pass on to his family... $80.8B x .01 = $808M

$808M x .90 = $727.2M in S&P 500 Vanguard Index Fund (90%)
$808M x .10 = $80.8M in Short-term Government Bonds (10%)

“My advice to the trustee could not be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund (I suggest Vanguard’s). I believe the trust’s long-term results from this policy will be superior to those attained by most investors – whether pension funds, institutions or individuals – who employ high-fee managers.” – Warren Buffett, page 20 - 2013 Letter to Berkshire Shareholders
"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Rowan Oak » Sun Sep 08, 2019 7:14 pm

nedsaid wrote:
Sun Sep 08, 2019 6:11 pm
willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
Not only that, Buffett isn't going to disclose the details of his estate plans. This all is based upon one comment he made regarding a trust set up for his wife. We really don't know what his estate plan is except the comment about the trust and that most of his Berkshire-Hathaway stock will go to the Gates Foundation upon death. I wouldn't base my estate planning based upon an off the cuff comment by Buffett.
So if he was only leaving his wife a few million or even just 1 million you think he would suggest something other than the Vanguard S&P 500 Index Fund for the stock portion of the investment plan? Probably not. But you're right it probably wouldn't still be 90/10. Maybe 50/50.
“If you can get good at destroying your own wrong ideas, that is a great gift.” – Charlie Munger

Ferdinand2014
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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Ferdinand2014 » Sun Sep 08, 2019 7:23 pm

Warren Buffett has made it clear his advise is buying and holding forever a low cost market cap weighted index fund, tuning out the noise and holding enough short term treasuries so you are comfortable for your needs. The 10% he has made very clear on multiple occasions, is merely a starting point to be adjusted based on personal comfort and needs, not a set asset allocation.

He also doesn’t make this recommendation as an off the cuff suggestion. Not only is it in his 2013 shareholder letter, but he used it in his bet against the hedge fund manager Protogé with $1,000,000 over a 10 year period invested in VFIAX (Vanguard 500 index) from 2007-2017. I hardly consider that off the cuff. Obviously and importantly VFIAX trampled the hedge fund manager and 5 hedge funds which also occurred during the financial crisis.

He went out of his way with the previous shareholder meeting to acknowledge (and invite) that Jack Bogle had done more for the American investor then anyone else in history. I do find it curious the inclination toward negativity with his advise when his advise is just about the most boglehead advice one could give. This forum by the thread popularities seems to like trend following, leveraging, all sorts of factor tilts and a whole host of very non boglehead concepts, but when arguably the most famous and successful investor of all time suggests VFIAX and short term treasuries for the average American investor it seems to be discouraged as poor advise.

In fact Jack Bogle uses Warren Buffett’s advice, words and thoughts in most chapters of his common sense book.
Last edited by Ferdinand2014 on Sun Sep 08, 2019 7:43 pm, edited 2 times in total.
“You only find out who is swimming naked when the tide goes out.“ — Warren Buffett

Null42
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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Null42 » Sun Sep 08, 2019 7:31 pm

I think the point is 10% in bonds is way too little to live on for most people. With Buffett's total wealth of course it is plenty to live on.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Rowan Oak » Sun Sep 08, 2019 7:33 pm

willthrill81 wrote:
Sun Sep 08, 2019 6:14 pm
nedsaid wrote:
Sun Sep 08, 2019 6:11 pm
I wouldn't base my estate planning based upon an off the cuff comment by Buffett.
Me neither.

Expanding that a bit, I would not base any aspect of my finances on what any one person, regardless as to how much I admired and trusted that person, said. That includes Bogle himself.
I've based all my investing decisions on Jack Bogle's advice. I've even taken his prudent advice and applied it to all aspects of my finances.
“If you can get good at destroying your own wrong ideas, that is a great gift.” – Charlie Munger

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by nedsaid » Sun Sep 08, 2019 7:48 pm

Ferdinand2014 wrote:
Sun Sep 08, 2019 7:23 pm
Warren Buffett has made it clear his advise is buying and holding forever a low cost market cap weighted index fund, tuning out the noise and holding enough short term treasuries so you are comfortable for your needs. The 10% he has made very clear on multiple occasions, is merely a starting point to be adjusted based on personal comfort and needs, not a set asset allocation.

He also doesn’t make this recommendation as an off the cuff suggestion. Not only is it in his 2013 shareholder letter, but he used it in his bet against the hedge fund manager Protogé with $1,000,000 over a 10 year period invested in VFIAX (Vanguard 500 index) from 2007-2017. I hardly consider that off the cuff. Obviously and importantly VFIAX trampled the hedge fund manager and 5 hedge funds which also occurred during the financial crisis.

He went out of his way with the previous shareholder meeting to acknowledge (and invite) that Jack Bogle had done more for the American investor then anyone else in history. I do find it curious the inclination toward negativity with his advise when his advise is just about the most boglehead advice one could give. This forum by the thread popularities seems to like trend following, leveraging, all sorts of factor tilts and a whole host of very non boglehead concepts, but when arguably the most famous and successful investor of all time suggests VFIAX and short term treasuries for the average American investor it seems to be discouraged as poor advise.

In fact Jack Bogle uses Warren Buffett’s advice, words and thoughts in most chapters of his common sense book.
I have followed Buffett for years and have learned a lot from him. Not saying that his advice regarding index funds is bad, in fact I agree with it. Most folks here are not going to invest using a 90% stock/10% Treasuries asset allocation. We need asset allocations that are appropriate to our own individual situations, 90/10 is not a one size fits all allocation. Mr. Bogle did say that an allocation of 65% stocks/35% bonds is good for most investors, that was probably the closest he came to giving one size fits all advice, he also has recommended Vanguard Balanced Index.
A fool and his money are good for business.

iamblessed
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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by iamblessed » Sun Sep 08, 2019 7:50 pm

Warren tries to bet the 500 each year so it would make since to recommend it. Now 90% for most Bogleheads is a bit much. I wish I was it years ago. Nothing wrong with the 500 most years it's returns are within 1% of the total market.
Last edited by iamblessed on Sun Sep 08, 2019 7:54 pm, edited 2 times in total.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by RJC » Sun Sep 08, 2019 7:52 pm

Ferdinand2014 wrote:
Sun Sep 08, 2019 7:23 pm
Warren Buffett has made it clear his advise is buying and holding forever a low cost market cap weighted index fund, tuning out the noise and holding enough short term treasuries so you are comfortable for your needs. The 10% he has made very clear on multiple occasions, is merely a starting point to be adjusted based on personal comfort and needs, not a set asset allocation.

He also doesn’t make this recommendation as an off the cuff suggestion. Not only is it in his 2013 shareholder letter, but he used it in his bet against the hedge fund manager Protogé with $1,000,000 over a 10 year period invested in VFIAX (Vanguard 500 index) from 2007-2017. I hardly consider that off the cuff. Obviously and importantly VFIAX trampled the hedge fund manager and 5 hedge funds which also occurred during the financial crisis.

He went out of his way with the previous shareholder meeting to acknowledge (and invite) that Jack Bogle had done more for the American investor then anyone else in history. I do find it curious the inclination toward negativity with his advise when his advise is just about the most boglehead advice one could give. This forum by the thread popularities seems to like trend following, leveraging, all sorts of factor tilts and a whole host of very non boglehead concepts, but when arguably the most famous and successful investor of all time suggests VFIAX and short term treasuries for the average American investor it seems to be discouraged as poor advise.

In fact Jack Bogle uses Warren Buffett’s advice, words and thoughts in most chapters of his common sense book.
We also have 100% equities (VTSAX + VFIAX equivalents) and sleep well at night. Simplicity is the key for us.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Ferdinand2014 » Sun Sep 08, 2019 7:58 pm

willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
I imagine a new ETF called the PPP commodity vector fund is just around the corner. :sharebeer
“You only find out who is swimming naked when the tide goes out.“ — Warren Buffett

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by mindboggling » Sun Sep 08, 2019 8:03 pm

"He could put it all in pork bellies, palladium, and paper clips and be just fine."


I dunno...I just don't use as many paper clips as I used to. :)
In broken mathematics, We estimate our prize, --Emily Dickinson

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Ferdinand2014 » Sun Sep 08, 2019 8:08 pm

mindboggling wrote:
Sun Sep 08, 2019 8:03 pm
"He could put it all in pork bellies, palladium, and paper clips and be just fine."


I dunno...I just don't use as many paper clips as I used to. :)
That’s why there are pork bellies and palladium. It’s called diversification. :mrgreen:
“You only find out who is swimming naked when the tide goes out.“ — Warren Buffett

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by mindboggling » Sun Sep 08, 2019 8:50 pm

Ferdinand2014 wrote:
Sun Sep 08, 2019 8:08 pm
mindboggling wrote:
Sun Sep 08, 2019 8:03 pm
"He could put it all in pork bellies, palladium, and paper clips and be just fine."


I dunno...I just don't use as many paper clips as I used to. :)
That’s why there are pork bellies and palladium. It’s called diversification. :mrgreen:
Yes, but it's dragging down my portfolio returns. Backtesting implied it should outperform. :confused
In broken mathematics, We estimate our prize, --Emily Dickinson

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Rowan Oak » Sun Sep 08, 2019 9:10 pm

Ferdinand2014 wrote:
Sun Sep 08, 2019 7:23 pm
Warren Buffett has made it clear his advise is buying and holding forever a low cost market cap weighted index fund, tuning out the noise and holding enough short term treasuries so you are comfortable for your needs. The 10% he has made very clear on multiple occasions, is merely a starting point to be adjusted based on personal comfort and needs, not a set asset allocation.

He also doesn’t make this recommendation as an off the cuff suggestion. Not only is it in his 2013 shareholder letter, but he used it in his bet against the hedge fund manager Protogé with $1,000,000 over a 10 year period invested in VFIAX (Vanguard 500 index) from 2007-2017. I hardly consider that off the cuff. Obviously and importantly VFIAX trampled the hedge fund manager and 5 hedge funds which also occurred during the financial crisis.

He went out of his way with the previous shareholder meeting to acknowledge (and invite) that Jack Bogle had done more for the American investor then anyone else in history. I do find it curious the inclination toward negativity with his advise when his advise is just about the most boglehead advice one could give. This forum by the thread popularities seems to like trend following, leveraging, all sorts of factor tilts and a whole host of very non boglehead concepts, but when arguably the most famous and successful investor of all time suggests VFIAX and short term treasuries for the average American investor it seems to be discouraged as poor advise.
I agree with you.

It's important to remember that just because you are a registered member at Bogleheads.org it does not necessarily mean that you follow the Bogleheads investment philosophy.

The Investing - Theory, News & General section of the forum in particular can be quite noisy at times.
“If you can get good at destroying your own wrong ideas, that is a great gift.” – Charlie Munger

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by willthrill81 » Sun Sep 08, 2019 9:19 pm

Rowan Oak wrote:
Sun Sep 08, 2019 7:33 pm
willthrill81 wrote:
Sun Sep 08, 2019 6:14 pm
nedsaid wrote:
Sun Sep 08, 2019 6:11 pm
I wouldn't base my estate planning based upon an off the cuff comment by Buffett.
Me neither.

Expanding that a bit, I would not base any aspect of my finances on what any one person, regardless as to how much I admired and trusted that person, said. That includes Bogle himself.
I've based all my investing decisions on Jack Bogle's advice. I've even taken his prudent advice and applied it to all aspects of my finances.
Bogle was a real gentleman, and I certainly admire him. But I stand by what I said. No one person has a monopoly on truth or wisdom.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Elysium » Sun Sep 08, 2019 9:20 pm

willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
No, he actually believes it will be a superior strategy to almost everything else including those employed by the so called highly skilled professional investors, and he is right about that, the broad market index has proven to be a tough opponent to almost anyone over really long periods.

I believe the trust’s long-term results from this policy will be superior to those attained by most investors – whether pension funds, institutions or individuals – who employ high-fee managers.” – Warren Buffett, page 20 - 2013 Letter to Berkshire Shareholders

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by willthrill81 » Sun Sep 08, 2019 9:34 pm

Elysium wrote:
Sun Sep 08, 2019 9:20 pm
willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
No, he actually believes it will be a superior strategy to almost everything else including those employed by the so called highly skilled professional investors, and he is right about that, the broad market index has proven to be a tough opponent to almost anyone over really long periods.

I believe the trust’s long-term results from this policy will be superior to those attained by most investors – whether pension funds, institutions or individuals – who employ high-fee managers.” – Warren Buffett, page 20 - 2013 Letter to Berkshire Shareholders
I agree that a low cost S&P 500 index fund is a fine investment instrument, one of the best in the world. But my point was that in Buffett's situation, the choice is pretty much moot.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by willthrill81 » Sun Sep 08, 2019 9:35 pm

mindboggling wrote:
Sun Sep 08, 2019 8:50 pm
Ferdinand2014 wrote:
Sun Sep 08, 2019 8:08 pm
mindboggling wrote:
Sun Sep 08, 2019 8:03 pm
"He could put it all in pork bellies, palladium, and paper clips and be just fine."


I dunno...I just don't use as many paper clips as I used to. :)
That’s why there are pork bellies and palladium. It’s called diversification. :mrgreen:
Yes, but it's dragging down my portfolio returns. Backtesting implied it should outperform. :confused
Mean reversion. Keep rebalancing. Stay the course.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by abuss368 » Sun Sep 08, 2019 9:57 pm

Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
Always good to hear Mr. Buffett endorse low cost index investing and of course Vanguard.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by abuss368 » Sun Sep 08, 2019 10:02 pm

The underlying investment message is most important: low cost, index funds, allocation between S&P 500 and Treasuries, and best of all simplicity.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Elysium » Mon Sep 09, 2019 8:21 am

willthrill81 wrote:
Sun Sep 08, 2019 9:34 pm
Elysium wrote:
Sun Sep 08, 2019 9:20 pm
willthrill81 wrote:
Sun Sep 08, 2019 6:04 pm
nedsaid wrote:
Sun Sep 08, 2019 5:52 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.

Best wishes
Taylor
Most of us are not Billionaires, most of us won't be 90% S&P 500 and 10% Treasuries in our retirement portfolios.
:thumbsup

When you have tens of billions, it doesn't really matter what you're invested in.

He could put it all in pork bellies, palladium, and paper clips and be just fine.
No, he actually believes it will be a superior strategy to almost everything else including those employed by the so called highly skilled professional investors, and he is right about that, the broad market index has proven to be a tough opponent to almost anyone over really long periods.

I believe the trust’s long-term results from this policy will be superior to those attained by most investors – whether pension funds, institutions or individuals – who employ high-fee managers.” – Warren Buffett, page 20 - 2013 Letter to Berkshire Shareholders
I agree that a low cost S&P 500 index fund is a fine investment instrument, one of the best in the world. But my point was that in Buffett's situation, the choice is pretty much moot.
On the outset it may seem like there are no major consequences to investment mistakes committed if you happen to have a very large portfolio. However, when you look closer, he is leaving around 800-900 million to heirs, and you could lose almost all of it or a large chunk of it by investing foolishly, for instance speculation with leveraged futures could blow up a billion dollars in no time. Granted that when you have billions it takes a little more to go broke, but we know from history, it's not impossible for even very wealthy to go broke by following speculative ideas.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by bgreat » Mon Sep 09, 2019 9:33 am

Mr. Buffet's wife's life expectancy may be quite different to the life expectancy of other people on this forum.If you are of her age, feel free to follow the Mr. Buffet recommendation. If you are of a different age, maybe don't treat it as gospel.

The risks are quite different in their scenario than for e.g. someone just starting out.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by deltaneutral83 » Mon Sep 09, 2019 10:14 am

90/10 all the way down to 50/50, it doesn't really matter, it's the same thing preached here in the 3F more or less. Buffet doesn't recommend 90/10 for people with less than 50x expenses I wouldn't guess.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by willthrill81 » Mon Sep 09, 2019 10:27 am

deltaneutral83 wrote:
Mon Sep 09, 2019 10:14 am
90/10 all the way down to 50/50, it doesn't really matter, it's the same thing preached here in the 3F more or less. Buffet doesn't recommend 90/10 for people with less than 50x expenses I wouldn't guess.
I find it a little funny that he has made plans for 90/10 and not 100% stock. While I'm not advocating a 'living on dividends' approach, the dividend yield of the S&P 500 is about the same as 10 year Treasuries' yield. Yes, the former could go down, but the opportunity for capital appreciation is obviously far higher too.

My personal view is that if someone is planning on 2% or lower withdrawals (for whatever reason), a logical argument could be made for them to be 100% stock, assuming that their risk tolerance would allow for it. But a logical argument could also be made for them to be 100% fixed income. When your withdrawal rate is so low, the range of plausible portfolios expands quite a lot.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by deltaneutral83 » Mon Sep 09, 2019 10:36 am

willthrill81 wrote:
Mon Sep 09, 2019 10:27 am
My personal view is that if someone is planning on 2% or lower withdrawals (for whatever reason), a logical argument could be made for them to be 100% stock, assuming that their risk tolerance would allow for it. But a logical argument could also be made for them to be 100% fixed income. When your withdrawal rate is so low, the range of plausible portfolios expands quite a lot.
This is probably why 50/50 or 60/40 (if you can stomach) is so popular I imagine for retirees. All Buffett is suggesting is a 2F and figure out your AA, he just doesn't care enough about international to look into it. It's a little much that tried and true BH's are grilling Buffett's approach due to the AA when that isn't even the point and BH's know it's not the point.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by TN_Boy » Mon Sep 09, 2019 10:58 am

deltaneutral83 wrote:
Mon Sep 09, 2019 10:14 am
90/10 all the way down to 50/50, it doesn't really matter, it's the same thing preached here in the 3F more or less. Buffet doesn't recommend 90/10 for people with less than 50x expenses I wouldn't guess.
You'd only be guessing. We've had a couple of threads on Buffet's advice for everyone else (i.e. not his wife's trustee).

I'm too lazy to look it up, but in one thread a poster did point to an interview where he said 90/10 was good for "just about everybody" or words to that effect.

But there is no additional commentary I've ever seen referenced on the 90/10 recommendation. So whether you think Buffett is a financial genius in ALL ways (including personal finance advice suitable for non-billionaires) or just a very astute businessman and investor, he has not provided a "plan."

In the accumulation years, a 90/10 portfolio, while more aggressive than I like and non-diversified internationally, doesn't sound like a terrible plan. Beyond that context, the idea of a one-size fits all portfolio seems bad.

I have trouble believing Mr Buffett has a good grasp -- no matter his intentions or character -- of the right financial choices for people who are not ultra-wealthy.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by willthrill81 » Mon Sep 09, 2019 11:05 am

TN_Boy wrote:
Mon Sep 09, 2019 10:58 am
Beyond that context, the idea of a one-size fits all portfolio seems bad.
:thumbsup

Similarly, I reject the concept of an 'average investor'.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by deltaneutral83 » Mon Sep 09, 2019 12:16 pm

TN_Boy wrote:
Mon Sep 09, 2019 10:58 am

In the accumulation years, a 90/10 portfolio, while more aggressive than I like and non-diversified internationally, doesn't sound like a terrible plan. Beyond that context, the idea of a one-size fits all portfolio seems bad.

I have trouble believing Mr Buffett has a good grasp -- no matter his intentions or character -- of the right financial choices for people who are not ultra-wealthy.
I think Buffett is perfectly suited no matter the situation (lives in a reasonably sized home, eats at McDonalds, etc etc) to give financial planning advice, he just doesn't that often and people take what he says out of context. We have plenty of people here who are 100/0 with just a tad less than Mr. Buffett in the net worth column, so you cannot attribute those BH's to being out of touch and/or wealthy, so what would you attribute that towards? Seems the scapegoat of being wealthy in Buffett's case is being arbitrarily used.

Buffett only said 90/10 because it's simple and he couldn't care less about international. He'd be more than open to 60/40 just probably no international. There are also many "advisers" who encourage 100/0 at any age because they hope to get more AUM and there fore more compensation and some are broke themselves.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by dbr » Mon Sep 09, 2019 12:46 pm

It seems clear to me that Buffett meant 90/10 for everyone and the S&P 500 for everyone. The basis for that is his ongoing confidence and optimism regarding American economic prospects.

If one wants to contend this is a good plan for your family too it means that you agree that stock investments should be in a diversified, low cost representation of the larger firms in American enterprise and it means that a 90/10 asset allocation is a good plan for everyone.

If you don't agree, then you don't agree.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by TN_Boy » Mon Sep 09, 2019 2:20 pm

deltaneutral83 wrote:
Mon Sep 09, 2019 12:16 pm
TN_Boy wrote:
Mon Sep 09, 2019 10:58 am

In the accumulation years, a 90/10 portfolio, while more aggressive than I like and non-diversified internationally, doesn't sound like a terrible plan. Beyond that context, the idea of a one-size fits all portfolio seems bad.

I have trouble believing Mr Buffett has a good grasp -- no matter his intentions or character -- of the right financial choices for people who are not ultra-wealthy.
I think Buffett is perfectly suited no matter the situation (lives in a reasonably sized home, eats at McDonalds, etc etc) to give financial planning advice, he just doesn't that often and people take what he says out of context. We have plenty of people here who are 100/0 with just a tad less than Mr. Buffett in the net worth column, so you cannot attribute those BH's to being out of touch and/or wealthy, so what would you attribute that towards? Seems the scapegoat of being wealthy in Buffett's case is being arbitrarily used.

Buffett only said 90/10 because it's simple and he couldn't care less about international. He'd be more than open to 60/40 just probably no international. There are also many "advisers" who encourage 100/0 at any age because they hope to get more AUM and there fore more compensation and some are broke themselves.
You said "He'd be more than open to 60/40 just probably no international."

Unless you sit in on those bridge games with Warren and Bill or have talked with Warren on the phone recently, I contend you have no idea what he would think of a 60/40 portfolio. In fact, this is the biggest problem I have with taking Buffett's suggestion -- he has thrown out this 90/10 recommendation in a couple of contexts, but there has been no back and forth with questions like "do you really mean 90/10 for everyone, are there any exceptions etc etc."

I'll reiterate: 90/10 S&P 500/US treasuries is a perfectly valid portfolio during accumulation for many people. It's not to my taste, especially near retirement, but I can see people choosing that mix.

But no, I do not understand how Buffett's opinion on personal finance should be taken as very useful. Obviously he understands investing. But I don't think he has spent much time pondering the financial issues of non-rich people, at least not in detail. Are his tax issues the same? If the stock market plummets 50 or 60%, will he be as concerned as the couple about to retire with a mere 300k in their 401k, invested 90% stock? Oh, retirement. Buffett is in his 80s. And not retired. So his retirement plan is not to retire. Which is very different from my retirement plan.

And a couple of your other comments ... sure some BHer's have a 100% stock allocation. What does that have to do with my post? And advisors encouraging people to be 100% stocks "because they hope to get more AUM". What does that have to do with anything? I thought we were talking about Buffett.

Incidentally, though he sold it last year, he did own a vacation home in Laguna Beach, CA for decades. It was an ocean view six bedroom house.

Buffett has a folksy and engaging style (I enjoy reading what he says and how he says it, but if you think he lives like you and I, or that his financial issues are similar you are sorely mistaken.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Fallible » Mon Sep 09, 2019 2:23 pm

Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.
Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
If low costs, tax efficiency, investing long term, and the value of simplicity are well understood and appreciated (and they sometimes are not), then the "Motley Fool" article is right on. Speights points out all of these, including quoting Buffett in his letter to Berkshire shareholders: "I believe the trust's long-term results from this policy will be superior to those attained by most investors -- whether pension funds, institutions, or individuals -- who employ high-fee managers."

For those who have the time and want to spend it on more complex investing, Speights says "the market can be beaten with the right approach."

As for comparisons of Buffett and his billions to us small investors, I think Larry Swedroe neatly addressed aspects of this in his book, Think, Act, and Invest Like Warren Buffett. Larry understood how often we misunderstand the Oracle.

Taylor, thanks for posting the "Motley" article. As for the S&P 500 index vs. a total stock market index, I switched from Vanguard's 500 index to its Total Stock Market Index many years ago after reading this from then WSJ columnist Jonathan Clements headlined "Forget Brand X: try a better way to index":

https://www.wsj.com/articles/SB113487182011325725
John Bogle on his often bumpy road to low-cost indexing: "When a door closes, if you look long enough and hard enough, if you're strong enough, you'll find a window that opens."

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Miriam2 » Mon Sep 09, 2019 3:09 pm

Fallible wrote: Taylor, thanks for posting the "Motley" article. As for the S&P 500 index vs. a total stock market index, I switched from Vanguard's 500 index to its Total Stock Market Index many years ago after reading this from then WSJ columnist Jonathan Clements headlined "Forget Brand X: try a better way to index":

https://www.wsj.com/articles/SB113487182011325725
Thanks for posting this article, interesting reading from Jonathan Clements in 2005.

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Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by abuss368 » Mon Sep 09, 2019 4:13 pm

Fallible wrote:
Mon Sep 09, 2019 2:23 pm
Taylor Larimore wrote:
Sun Sep 08, 2019 2:01 pm
Bogleheads:

The Motley Fool is featuring an article by Keith Speights in which he talks about Warren Buffett's Investing Plan for his wife. Many forum readers will not be surprised to learn it is primarily Vanguard S&P 500 Index Fund. I slightly prefer the Vanguard Total Stock Market Index Fund but I believe that any low-cost broad market index fund is the ideal U.S. stock fund for most portfolios.
Best wishes
Taylor
Jack Bogle's Words of Wisdom: "My preferred index fund happens to be the total stock market which includes large, medium, and small stocks."
If low costs, tax efficiency, investing long term, and the value of simplicity are well understood and appreciated (and they sometimes are not), then the "Motley Fool" article is right on. Speights points out all of these, including quoting Buffett in his letter to Berkshire shareholders: "I believe the trust's long-term results from this policy will be superior to those attained by most investors -- whether pension funds, institutions, or individuals -- who employ high-fee managers."

For those who have the time and want to spend it on more complex investing, Speights says "the market can be beaten with the right approach."

As for comparisons of Buffett and his billions to us small investors, I think Larry Swedroe neatly addressed aspects of this in his book, Think, Act, and Invest Like Warren Buffett. Larry understood how often we misunderstand the Oracle.

Taylor, thanks for posting the "Motley" article. As for the S&P 500 index vs. a total stock market index, I switched from Vanguard's 500 index to its Total Stock Market Index many years ago after reading this from then WSJ columnist Jonathan Clements headlined "Forget Brand X: try a better way to index":

https://www.wsj.com/articles/SB113487182011325725
Thank you for sharing the article.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

wesgreen
Posts: 191
Joined: Fri Jan 07, 2011 9:14 am

Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by wesgreen » Mon Sep 09, 2019 8:21 pm

Yes, don't make my mistake and buy international.

Ferdinand2014
Posts: 836
Joined: Mon Dec 17, 2018 6:49 pm

Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by Ferdinand2014 » Mon Sep 09, 2019 8:32 pm

wesgreen wrote:
Mon Sep 09, 2019 8:21 pm
Yes, don't make my mistake and buy international.
Thank you for the excellent advice. I have learned by my many mistakes.
“You only find out who is swimming naked when the tide goes out.“ — Warren Buffett

3000
Posts: 3
Joined: Sat Aug 17, 2019 9:08 pm

Re: "Warren Buffett's Investing Plan for His Family: Why It's a Good Plan for Your Family, Too"

Post by 3000 » Mon Sep 09, 2019 9:00 pm

Would the Vanguard Short-Term Treasury Fund Investor Shares (VFISX) be good for the Treasury part?

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