 All right, I'm gonna do my best to channel some Jack Bogle here. We're gonna talk about staying the course. I miss Jack I Tried to go to my first or went to my first Bogle heads meeting. I think it was 2008 So I wanted to meet Jack and those who were there. No, he was in the hospital So the hospital with some heart problems and he wasn't able to make it But he called in from the hospital by video So he did speak to us at that conference But I had to come back to a later conference to actually meet Jack and I wish you all were able to sit here and Have Jack teach you this principle. So I'm gonna try to do the best I can in his place Let's start with his words though In fact, we're mostly going to use his words for this section because stay the course seems so easy That you all just want to tune out and not even think about it Of course the last principle stay the course, but you know what? It's the hardest one to do All the other ones are easy compared to this So this is what Jack said said stay the course No matter what happens stick to your program I've said stay the course a thousand times and I meant it every time It is the most important single piece of investment wisdom. I can give to you and He has said it so many times that he says in a whole bunch of different ways. He says press on regardless Says don't do something just stand there. So what does stay the course really mean? I Think there's about five things that it means. So let's talk about them each individually. Here's the first one Don't change your plan based on how you feel Now these quotes you see here. These are all from Jack Bogle said investors should keep their emotions the heck out of the way Investor emotions plus fund industry promotions equals trouble The greatest enemies the investor our expenses and emotions and Time is your friend impulse is your enemy We all feel like the market's going to go down or the market's going to go up. I would challenge you To actually keep track of those feelings and those predictions you have get yourself a little two dollar Journal that you buy at the grocery store and start writing down these predictions of yours It is a very enlightening exercise to do this over the course of a year or two or three and You will be surprised by the end. How poor you are at predicting the future and How wrong your feelings are quite often one of my favorite books I can't even remember the name of it. Which is really sad but it's written by an attorney who lived through the Great Depression and He put an entry in this diary every two or three months throughout the 1930s Talking about the economics of the era and it's fascinating to read in real time the history that you now know but what it was like to live through it and That can be what your journal is is it can help you to live through your feelings about the markets and your investments But I can promise you this if you actually keep track of them You'll quit paying any attention to them after a while because they are wrong wrong wrong Alright, the second thing staying the course means is don't chase performance Jack said buying funds based purely on their past performance is one of the stupidest things that an investor can do And there's a reason they have to put that in every mutual fund Perspective it's because it's true. It's true chasing performance is a terrible way to invest You buy it right after it does great right before it does poorly So when you're staying the course you're not chasing performance It means don't keep looking for a better plan Okay, Jack said the greatest enemy of a good plan is the dream of a perfect plan stick to the good plan My wife and I we drew up an investment plan in 2004 I think we made a couple of changes in 2005 or 2006 we made one other change in like 2016 and we followed that investment plan from being dead broke to being financially independent is it a perfect plan No, it's a pretty good plan. It's not the best plan if I'd had a crystal ball in 2005 The plan would look very different, but I did not have a crystal ball We picked a good enough plan and we followed it and it worked Amazingly you funded a reasonable plan adequately and you will reach your financial goals Okay, stay the course means to be patient Jack said rely on the ordinary virtues that intelligence intelligent balanced Human beings have relied on for centuries common sense thrift realistic expectations patience and perseverance It's not that easy to stay with the same plan for 15 years much less 60 right your investment career is probably about 60 years long 30 years Accumulating 30 years distributing give or take ish That's a long time to be patient with the plan, but that's what it requires to be successful Okay, staying the course means you don't sell out at market lows Right Jack said if you have trouble imagining a 20% loss in the stock market You shouldn't be in stocks because they do that all the time if you sell low just once late in your accumulation phase That can be a financial Catastrophe that keeps you from ever reaching your financial goals It is so important that you do not sell out at market lows. It might be the most important thing about investing Imagine an investor who sells out of their stocks at each of the following time periods and then buys back after the recovery to the prior high Hey, if you did that in March of 2003, right? Stocks have been going down for three years, right all these tech stocks have gone to zero It's never gonna come back. They're flying planes into our buildings in New York City, right? You remember this if you live through it Okay, if you sold out at that moment and didn't buy in until the market recovered you had a 46 percent permanent loss of capital All the money you had invested in stocks 46% of it is just subtracted from your nest egg and never comes back March 2009 the global financial crisis Money market funds are breaking the buck Right, everybody's panicking on the Bogleheads forum. Everyone's talking about plan B Everybody remember plan B, you know as a physician plan B means something very different But on the Bogleheads forum plan B was the idea that you bailed out if it got bad enough And I didn't really like plan B I wasn't a big fan, but I can tell you it was discussed extensively in 2008 and 2009 on the forum If you had sold out your plan B In March of 2009 you were looking at a 52 percent permanent loss of capital Okay, who remembers 2011 nobody remembers 2011 it technically wasn't a bear market It was only like 19 percent or 19 and a half percent down It wasn't 20 percent down if you sold out there though 19 percent permanent loss of capital December 2018 is the other one everyone forgets about it was down 18 19 percent again that month if you sold out 18 percent permanent loss of capital we all remember the start of the pandemic Right because they shut down the NBA and we had nothing else to do but look at our stocks 34 percent permanent loss of capital just because you weren't patient enough to hold on for a few more months Okay, right now we're down what I don't know 20 percent 25 percent something like that You know, we don't know how bad it's going to get But if this is the bottom this month and you sell out it's 25 percent permanent loss of capital Okay, these are real situations that you got to live through You know, you should ask yourself What do I have to expect as an investor who's going to be investing for 30 years as an accumulator? And for 30 years as a decumulator Okay, well corrections aka a 10 drop occur on average every 19 months If you go back and look at all the data we have so far Bear markets, which is a 20 plus drop occur on average every 3.6 years So with some simple division, I don't do algebra like Mike with some simple division. I can tell That I'm going to have to go through a bunch of these Well, I'm going to have to go through about 39 corrections as an investor I'm going to have to go through about 17 bear markets as an investor This is an expected event Right, it's an expected event to go through a bear market. It shouldn't be a surprise when it happens You know, it's going to happen every two or three or four or five years Your plan should address it You should plan to stay the course with your plan throughout these events that you plan for On average bear months bear markets last 10 months. Okay, sometimes they're much shorter Right that one with the pandemic whoop. It was back Right as the fastest bear market recession. I think we've seen in a long time Although that one in octo was in october of eight 1987 that one was pretty quick too Right huge one day drop biggest one day drop ever still finished positive for the year in 1987 right if you'd bailed out permanent loss of capital It's interesting if you look at the markets the history of the markets and you should be a student of the markets Stocks have provided a positive return in 78 percent of years That includes many of those years when there was a correction and when there was a bear market I think it was alan slider earlier that he showed of all those maximum drawdowns that you had during a year with a positive return Happens all the time Okay, so here we are jack bogels advice Stay the course. It is the most important single piece of investment wisdom that I can give to you