Whether or not you’re familiar with his name, as a financial professional, you owe a debt of gratitude (and your career) to Jack Bogle. Born May 8, 1929, Bogle’s family was hit hard by the Great Depression. This experience would prove formative as he later went on to change the financial industry by creating the first index mutual fund available to consumers.
Not long after founding the Vanguard Group in 1974, a company that now handles nearly $5 trillion in assets, Bogle established the First Index Investment Trust, the first to be built around the S & P500. This introduced a low-cost, passive approach to investing and, in the process, leveled the playing field for the “small-time” investors of the world. His common-sense financial philosophy and disdain for corporate excess (high broker fees, non-transparent and unethical practices, etc.) sparked a revolution that allowed millions to save and invest for retirement.
Bogle’s fierce advocacy for indexing was, at the time, a dramatic break from industry tradition. And while he faced criticism from Wall Street, he went on to become one of the most respected and renowned names in finance and someone whom Warren Buffet once called a “hero.”
In his 1999 book, “Common Sense on Mutual Funds: New Imperatives for the Intelligent Investor,” Bogle laid out these eight basic rules for investors:
- Select low-cost funds
- Consider carefully the added costs of advice
- Do not overrate past fund performance
- Use past performance to determine consistency and risk
- Beware of stars (as in, star mutual fund managers)
- Beware of asset size
- Don’t own too many funds
- Buy your fund portfolio, and hold it
Bogle left Vanguard in 1999 and, a year later, founded the Bogle Financial Markets Research Center. He passed away on January 16, 2019, leaving behind a legacy built on philanthropy and standing up for the “little guy.”