Vanguard's John Bogle: 'The Less You Watch the Market, the Better Off You'll Be'


If you haven’t heard of John Bogle before this week, when news broke that he passed away at 89, you’ve probably heard of the company he founded and led for decades. In 1974, Bogle created the Vanguard Group, one of the world’s largest mutual fund companies with more than 20 million investors and $5 trillion under management.

Chances are, if you have a 401(k) or an IRA , you’ve got money in a fund owned by Vanguard. The good news is that means you’re probably not paying a lot in fees to hold it. Bogle long espoused the benefits of low-cost index funds.

His firm introduced the first index fund in 1976. The Vanguard Index Trust, later renamed the Vanguard 500 Index Fund (VFINX), tracks the performance of the S&P 500 Index, one of the most commonly used benchmarks for the stock market. As of January 2019, it had more than $400 billion invested in it.

Bogle, arguably one of the most successful investors on the planet, had a pretty simple take on investing : Avoid high-cost funds. Invest in indexes. Put your money in a mix of stocks and bonds.

Back in 2016, we spoke to him about why he’s such a fan of index funds and the biggest mistakes investors make.

Your investing philosophy could be summed up by the old saying: Keep it simple, stupid. Why does simplicity work?
Related: Everything You Need to Know About Investing in the Stock Market So how should you allocate your money between them?
Where do you start?
You may get the same return with an [actively managed] fund, but you could be losing at least 2 percent to trading, mutual fund sales loads, the expense ratio and other fees. So why isn’t everyone investing in index funds?
There’s no pot of gold. And there’s no rainbow. If you can just avoid stupid mistakes, you’ll do very well. What are the biggest mistakes investors make?
When did you start investing?
Since then, I’ve added index funds. I’m overwhelmingly an indexer. When did you become convinced index funds could outperform others?
There’s been a lot of money moving out of actively managed funds and into lower-cost passive funds over the last few years. Are consumers becoming more aware of fees when choosing where to put their money?
How much attention should investors pay to the day-to-day movements of the market?
Which is?
The stock market has been pretty volatile in recent months. Where do you see stocks and bonds going?
This post was updated on January 17, 2019.