Save

• Empowerment from intentional spending; not deprivation
• Returns matter less if nothing is available to invest
• Lower income with high savings can outperform high income with high spending
• Minimizing taxes increases capital available
• Wealth builds slowly through compound interest
• 10% return doubles money in about 7.2 years
• Over ~28 years money can grow 16x at that rate

Index

• Use low-cost index funds as primary investment approach
• Clear, simple plans improve consistency and reduce anxiety
• Avoids stock picking errors and emotional decisions
• Recommended by Warren Buffett
• Index funds outperform most active managers over time
• Low turnover increases tax efficiency
• Provides broad diversification across hundreds of companies

Diversify

• Diversification reduces overall investment risk
• Rebalancing maintains target asset allocation
• Rebalancing may not increase returns but improves stability
• Discipline is required to stay consistent over time
• Avoid emotional reactions to market fluctuations

Avoid Blunders

• Behavior matters more than the market
• You are the biggest factor in investment success
• Goal is to survive long enough for compounding to work
• Avoid large mistakes to protect long-term outcomes
• Overconfidence increases risk of poor decisions
• Herd behavior leads to bad timing decisions