John “Jack” Bogle founded Vanguard Group in 1974 on the idea that low-cost index funds, which reflect the performance of the entire stock market, would outperform actively managed funds.
He turned out to be right. Index funds consistently outperform most high-fee mutual funds; investing gurus like Warren Buffett fervently endorse them; and Bogle’s company, Vanguard, is now one of the world’s largest financial institutions, with nearly $US3 trillion assets under management.
“I look at money not as an end but as a means to an end,” Bogle said.
To underscore his point, Bogle told a great story about the writers Kurt Vonnegut and Joe Heller.
“They meet at a party on Shelter Island,” he said. “Kurt looks at Joe and says, ‘That guy, our host over there, he made a billion dollars today. He’s made more money in one day than you made on every single copy of ‘Catch-22,’ [Heller’s novel].'”
“And Heller looks at Vonnegut and says, ‘That’s OK, because I have something he, our host, will never have. Enough.”
The investor knows something that many of us forget: Striving for more will never be as satisfying as having enough.
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