A few years ago I read some short financial advice by Scott Adams, the author and creator of the Dilbert cartoon. It’s great advice–it’s perfect for 95% of Americans’ finances and investing. Without further ado, here is Dilbert’s One Page Personal Finance List:
- Make a will.
- Pay off your credit card balance.
- Get term life insurance if you have a family to support.
- Fund your company 401K to the maximum.
- Fund your IRA to the maximum.
- Buy a house if you want to live in a house and can afford it.
- Put six months’ expenses in a money market account.
- Take whatever is left over and invest it 70 percent in a stock index fund and 30 percent in a bond fund through any discount brokerage company and never touch it until retirement
- If any of this confuses you, or you have something special going on (retirement, college planning, tax issue), hire a fee-based financial planner, not one who charges you a percentage of your portfolio.
This advice is completely spot on. I’m not going to add anything more in this post–this advice stands on its own incredibly well.
Thanks to Scott Adams for permission to reproduce this list. I read the advice in a book and at the time I couldn’t find it on the web. So in 2010 I emailed Mr. Adams and asked for permission to reproduce the advice, and he replied and said that was fine.