JL Collins from jlcollinsnh | The Stock Series

019 | JL Collins from jlcollinsnh | The Stock Series | Part 1

In Today’s Podcast JL collins from jlcollinsnh joins Jonathan & Brad on the podcast to bring the Stock Series to life. The Power of Index Investing is one of life's greatest secrets & JL Collins is the ultimate travel guide. This multi part series turns the stock series into an interactive audio companion and this first part is sure to compel you to stick around for each additional entry

The Stock Series | Part 1

  • Our guest: Jim Collins from JLCollinsNH.com
  • The Stock Series Part 1: “There’s a Major Market Crash Coming!!!! And Dr. Lo Can’t Save You”
  • Lo claimed that “buy and hold investing doesn’t work anymore” and that raised Jim’s ire quite a bit which led to the Stock Series
  • An overview of the Stock Series and how Jim would explain it
  • Jim’s eight rules that you need to understand in order to succeed with long-term stock market investing
  • “The Market Always Goes Up” which is very counterintuitive to people, but over the long-term it invariably does
  • The market is always going to stumble or have corrections and you can’t predict when they are going to happen and you have to accept them.
  • Nobody can possibly predict or time the market
  • The stock series came out of a series of letters to his daughters on financial education
  • When it comes to investing (once you get the basics down correct) the less you pay attention, the better off you’ll be.
  • Fidelity study of the best classes of investors based on performers: Dead people and those who lost their accounts!
  • You can’t panic when the stock market goes down significantly. You must “know yourself.”
  • If the market is already down 50% would you still be able to hold the course and not sell if you still thought it was going to do down an additional 2/3’s?
  • Quotes from Warren Buffett about not being fearful and buying when others are selling
  • For a new investor who is investing significant money each month, the best thing that can happen is a huge plunge in the market because they get to purchase new shares on a huge sale
  • In a wealth-preservation state, you should consider buying a percentage of your portfolio in bonds
  • Jim has a 25% bond allocation, which is actually considered very aggressive for his age
  • Warren Buffett quotes about investing in low-cost mutual funds from Vanguard
  • How does index investing deal with winners and losers in the index?
  • Downside of each company is limited to them losing 100%, but the upside is unlimited
  • The Dow Jones is not the “market.” Just an index with 30 large companies
  • Stock picking contests in schools in the US are fundamentally looking at it the wrong way and are incentivizing short-term thinking

Hot Seat Questions

  • Favorite blogs: Mad Fientist, Go Curry Cracker, Millenial Revolution, The Wealthy Accountant
  • Favorite life hack: Public Libraries and geographic arbitrage
  • Biggest financial mistake/advice you’d give your younger self: Understand the power and value of index fund investing much earlier
  • Favorite purchase on Amazon.com this past year: new rechargeable electric razor
  • Jim’s experiment in hotel living

Links from the show:

Books Mentioned in the Show:

JL Collins from jlcollinsnh | The Stock Series

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6 thoughts on “019 | JL Collins from jlcollinsnh | The Stock Series | Part 1”

  1. I enjoyed this episode so much that I looked into to getting Jim Collin’s book. Sadly, my city doesn’t have it in any of its branches. When I looked on Amazon, I saw that it is part of the Kindle Unlimited program. I don’t subscribe to Kindle Unlimited, but I do know that books available on Kindle Unlimited are also available under the Kindle Owner’s Lending Library. Sure enough, I was able to download The Simple Path to Wealth to my Kindle and begin reading immediately for free! Perhaps a tip for your Friday Roundup if your baby doesn’t make an appearance sooner!

  2. One thing I really appreciate learning through the FI community is to change my perspective on stocks. It seems like the prevailing view of stocks is that they are some kind of alternate currency instead of part ownership in a company. My plan for dealing with the eventual downswings in the market is to focus not on the dollar amount (which is only truly relevant when you are selling) and to focus on the amount of shares. I’m excited to teach my younger siblings lessons I’m learning so hopefully they can get started in their teens instead of waiting until they are almost old enough to theoretically be a grandma.

  3. Great show!

    I was intrigued by his statement regarding reallocation (currently 75%/25% stock/bond) in the event of a downturn. I am still in wealth accumulation phase, but I have had similar thoughts around focusing more into the market in the event of a downturn because I have 5 to 10 years before FI.

    My question is has anyone seen a systematic way to determine this? I don’t wan’t to be picking my own threshold and effectively trying to time the market.

  4. humbling! 22 years ago, I was all about index funds. But, like a lot of suckers, I drifted away and started thinking I could do better other ways.

    This podcast made me look back and realize just how wrong I was.

    Like JT, I’ve done ok with my other strategies — but dang I left a LOT of money on the table by not just leaving my money in an index fund!

    Opened my Vanguard account today!

  5. Another outstanding interview with JL Collins….thank you! I love that at 55:00 JL mentions that only ONE of the original companies of the Dow Jones Industrial was remaining after these past 120 years. Well, its worth mentioning that as of June 2018 even GE is now gone from the DJI. Its just not worth it to pick stocks….I’m a big believer in Index Fund investing, and will continue to be.

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