Investing Skeptically – How Do I Start?

Investing Skeptically is an ongoing education series.  Investing SkepticallyThis information is for educational purposes only.  This information does not constitute investment advice, legal advice or tax advice.  If you are in the need of financial advice please contact Phil Ferguson at Polaris Financial Planning.  (Polaris Financial Planning LLC, is a “fee-only” registered investment advisor and does not receive money from anyone other than the paying clients.  Polaris Financial Planning is committed to supporting the growing secular movement in the United States and donates at least 10% of all revenue to support this cause.)


I have been thinking about doing this new series “Investing Skeptically” for a long time but, I did not know where to start.  At the last “Investing Skeptically” talk I gave I noticed a common question from many people – How do I start?  Since, I am having the same problem, it seemed like a good topic.

To be clear, this series is not for the investing “expert”.  I will not be discussing advanced trading tricks like straddles, buying pork bellies or currency arbitrage.  I will also not be providing trading secrets or hot tips to make money fast.  Quite frankly, I see this kind of “investing” as glorified gambling and counterproductive for the average investor.  I will use the skeptical principles of Methodological Naturalism, Critical Thinking and Consumer Protection to assist the average investor find reasonable returns with reasonable risk.  (Reminder:  As stated above this information is for educational purposes and does not constitute investment advice.)

Investing Skeptically – How Do I Start?

Get an education on investments.  You don’t have to know it all and you don’t have to do it overnight but, it is important.  This knowledge will help you on your long-term journey of creating your everlasting nest egg.  For me the goal is to get to this point.  The everlasting nest egg is an investment portfolio that it is big enough to last – forever (or at least as long as you do)!  I will discuss this idea in more detail in future “Investing Skeptically” posts – please check back!  Your knowledge will help you invest on your own or with an advisor.

Start your education by picking up a few copies of magazines like “Money” or “Kiplinger’s”.  You can get them at a book store, drug store or read them for free at your library (you may also be able to view them on your kindle, android or apple device).  The magazines usually have short pieces that are written for the novice reader.  Read them and become familiar with the terms and some basics on how the markets work.  You will not become an expert overnight but, after you read a few you will understand some investing basics which may prevent you from getting ripped off.

Warning:  Do NOT take any of the specific advice given in a magazine.  In a single issue you can find a story on buying for the long-term and another on the hottest stock over the last 6 months.  If you are new – you will have no way to know which ideas are good for you and you can easily start down the wrong path.  A few extra months of education should pay big long-term dividends.  Remember this is a long trip not a sprint and one of the best ways to make money in the long run is to not lose money in the short run.

The next step  – read some good books.  Start with one of my favorites.  “Common Sense on Mutual Funds” by John C Bogle (image on the left).  This is a classic book was first published in 1999 and updated in 2009.  It has a lot of math and statistics so it may scare off some readers but, it is not that bad!  It is one of the most important investment books I have ever read.  I think of it as my investment bible! (go buy a copy – It is just $20)

This book is written by John C. Bogle the founder of The Vanguard Group, Inc and one of the most influential people of the investment world.  He discusses the basics of investing and provides statistical support for the wisdom of index funds.  FYI… these topics will also be covered in future posts so, you can just check back here.

Future posts will cover many topics including: Index funds, bonds, stocks, life insurance and some investment scams.  The idea is to help you become a better investor.  Please let me know how I can help.  Tell me what you want to know about and I will try to get to it sooner!

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