Everything you need to know about money in 9 rules.

zagubov

Andy_L wrote: »

ISTR reading (some time ago though) that in America active and passive funds have different tax treatment which skews the balance between the 2 unlike in the UK

The main differences are briefly described here.

I think the prof was pointing out that active funds don't perform consistently better than passive ones but have more costs, as you have to pay the manager.

Malthusian

1. Money is stored value
2. Borrowing money makes you poorer, unless it is to buy a house, education or other appreciating asset
3. Gambling always makes you poorer
4. Rainy day savings are essential expenditure, like rent; if you fail to pay the rent you have to find a new house and if you fail to top up the rainy day fund you have to borrow money (see 2)
5. If you hold money in cash over the long term you will have less money in the future
6. If you invest money in the stockmarket over the long term you will have more money in the future
7. Point 6 assumes you do not panic and cash in during crashes, fail to diversify, or borrow to invest
8. Either make certain you are maximising tax-efficiency, or pay someone else to

One fewer line than the US professor. Admittedly, this addresses the thread title of "everything you need to know about money" whereas the question the US professor was originally answering was "how to avoid bad investments", which is quite different. But when he drew up his index card he seems to have decided to answer a different question.