“Enough” by John Bogle – Wrapping Up: What’s Enough?

What’s Enough For Me

I have never played in that billion-dollar-plus major league; nor, for that matter, even in its hundred-million-dollar-plus league. Why not? Simply because as the founder of Vanguard, I created a firm in which the lion’s share of the rewards would be bestowed on the shareholders of the truly mutual mutual funds that compose the Vanguard Group… So, in comparison to nearly all, if not all, of my peers in this business, I’m something of a financial failure. P 234-235

Wellington’s first contribution to the plan was made in July 1951, 15 percent of my first month’s salary of $250, or just $37.50. I’ve continued investing 15 percent of my compensation… After stepping down as Vanguard’s chief executive, I’ve continued to put away 15 percent of the modest annual retainer I receive from the firm. P 236

What’s Enough For America

I share the concern of New York Times columnist David Brooks about what he describes as “this stark financial polarization”. On the one hand, there is the investor class. It has tax-deferred savings plans, as well as an army of financial advisers. [On the other hand,] there is the lottery class, people with little access to 401(k)s or financial planning but plenty of access to payday lenders, credit cards and lottery agents… The loosening of financial inhibition has meant more options for the well-educated but more temptation and chaos for the most vulnerable. Social norms, the invisible threads that guide behavior, have deteriorated. Over the past years, Americans have been more socially conscious about protecting the environment and inhaling tobacco. They have become less socially conscious about money and debt. P 241

What’s Enough For You

Whoever cultivates the Golden Mean avoids both the poverty of a hovel and the envy of a palace. That’s the standard that the Roman poet Horace urged upon us some two millennia ago, and it is an equally valid standard today. P 239

When you plan your financial future, don’t fool yourself by focusing on the nominal gross returns on stocks and bonds; subtract the costs you expect to be assessed, and work with net returns. Then assume that even those returns will be reduced by inflation. Set realistic goals that you can reasonably expect to achieve. P 239-240