“If You Can” by William Bernstein for Free

if you can

William Bernstein is a well know personal finance writer who tries his best to convince people to save for retirement using low cost broadly diversified index funds.  He has written a few books on the topic but recently released a short e-book for young people who need help investing.

You should read this book!  Why?

First of all the book is free (legally free, I might add).  Mr. Bernstein wants to get the message out to young people that they have to take responsibility for their retirement saving.

Second, the book’s advice in incredibly easy to follow.

Third, the book’s advice works.

This is all you need to know to invest well as specified in “If You Can”.

  • Save 15% of your pretax income, each and every year from your first year of working until retirement.  So if your yearly salary is $60,000, save $9000 per year.  The 15% is a little high for a Canadian audience unless you really don’t mind forgoing spending while you are young in order to have more money when you retire.  I’d rather have a similar level of spending while working and retired, and for that to happen, our experts recommended 6-10% savings.
  • Invest this money in 3 things equally (I have modified this for a Canadian audience):  1/3 in a low cost Canadian etf like Vanguard Canada’s VCN,  1/3 in a low cost international etf like Vanguard Canada’s VXC,  1/3 in a low cost Canadian bond fund like Vanguard Canada’s VAB
  • Once a year, re-balance your 3 etfs so that they each stay at 1/3 of your total portfolio. For example, if bonds do well one year, you may sell some VAB and buy some VCN and/or VXC.  Or else, don’t buy any VAB next year but instead purchase only VCN and/or VXC.  Just keep the 3 etfs at equal value.

That’s all folks.

Do this every year for 40 years, and you should have a superb retirement.

If your company offers you a pension plan and together you contribute at least 10-15% of your pay to it,  you don’t have to save anything more for retirement.  Just make sure you are out of debt before you retire.

Download the free PDF here:

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