Sunday, July 21, 2013

Simple Money Management Strategies are Effective But Frowned Upon (N&O Link)

My First Column for the Raleigh News & Observer


  1. Shhhh!!! Quit telling people about low cost index funds, it will spoil the secret. Oh what the heck, even books by John Bogle of Vanguard has not turned much of the tide in that direction. People think they can beat the market and it will rise forever. I read John Bogle and became a Boglehead and have most of our investments with Vanguard. I had a fee for service financial adviser and was satisfied because he was good, but as our investments grew I saw the fee go up. He was only charging on average half a percent, but it had crept from one thousand per year to closer to 4000 and I wondered what we were getting for that. I finally decided that my wife and I should go Vanguard and save that 4000 each year. This is the third year and I have not regretted it. It was frustrating to transfer all our funds as we had 2 401K and one 403B account as well as taxable investments and two Roth IRA's. Enjoyed your column. Hope you will be a regular contributor.

  2. You're 100% right. Despite the evidence and John Bogle's advocacy, active management is alive and well. Actually not surprising. The money management business, and mutual funds in particular are great marketers. You might enjoy "How We Get Away With It" posted September 26, 2012 on this blog. My next column for the N&O will appear on August 4th.