Is investing really so simple that a complete plan could fit on one card? It is, according to Harold Pollack. Here’s the card (click for enlargement):

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Actually, it’s even simpler than that: “buy and hold index funds,” after getting your finances in order so that you have some money to save. Here’s a little detail on how the card stacks up:

  • The first line talks about maxing your 401(k) or equivalent — great advice, especially for all dollars saved that generate an employer match.
  • Those “inexpensive, well-diversified mutual funds”? The most inexpensive and most diversified are index funds. And that strategy means “not buying and selling individual securities.” More of the same shows up below when the card says to pay attention to fees and avoid actively managed funds — again, automatically taken care of if you buy and hold index funds.
  • “Save 20% of your money” and “pay your credit card balance”? That’s a reasonable goal for a percentage and good advice on credit cards.
  • Maximize tax-advantage savings vehicles? That’s the first point again.
  • Make financial advisor commit to a fiduciary standard? Sure, get a good advisor when you need one, but up until that point just buy and hold index funds.
  • And finally, promote social insurance programs? That’s a reasonable position to take, with a couple of things to keep in mind: (1) It won’t personally affect your wealth, because of (realistically) your inability to affect national legislation; and (2) “Promoting social insurance programs” doesn’t mean you have to promote badly run social insurance programs or social insurance programs that are doomed to collapse.

Finally, what’s missing from the card? The most important things in life, such as faith and friendship and love. “Promoting social insurance programs” is a poor secular substitute for any of those things.

That “one card”