[sivers]

Please read this very tiny succinct powerful book: http://sivers.org/book/SmartestInvestmentBook

I put my notes on that page, but the real book is really worth reading. It sums up the wisest advice about passive investing so well.

Don't go with one fund. Do three:

#1 = An index fund representative of the US stock market in its broadest terms. (Fidelity: FSTMX, Vanguard: VTSMX)

#2 = An index fund representative of the international stock market in its broadest terms. (Fidelity FSIIX, Vanguard: VGTSX)

#3 = An index fund representative of the US bond market in its broadest terms. (Fidelity: FBIDX, Vanguard: VBMFX)

ASSET ALLOCATION:

LOW RISK = 14% stocks, 6% int'l stocks, 80% bonds

MEDIUM-LOW RISK = 28% stocks, 12% int'l stocks, 60% bonds

MEDIUM-HIGH RISK = 42% stocks, 18% int'l stocks, 40% bonds

HIGH RISK = 56% stocks, 24% int'l stocks, 20% bonds

(NOTE: all stock-holdings are 70% domestic, 30% international. Only choice is how much are stocks and how much are bonds.)

[tocomment]

Question I've been wondering. Is it ok to buy into a bond fund like VBMFX right now in this low interest rate environment?

If interest rates go up a lot in a year or two will my share price drop a lot and cancel out any gains from interest?