Superstar Managers Don’t Mean Superstar Returns: Renowned Investor

I've never made over $80K and have several million, none of it from inheritance. A few people here get it. I'd like to recap.

Start now, no matter how much or how little or how late you think it is. The past is gone, the future can still be changed.

Spend less than you earn.

Know where the money goes and create a budget. If you don't know where the money goes each month, how can you control it?

Don't pay to carry debt except for a house or car.

NEVER go out on margin when investing.

Become tax efficient with 401K, 203B, Roth IRA, etc.

Buy 2 - 3 year old cars and let the other guy take the big depreciation hit.

Don't invest in what you don't understand.

Diversify - stocks, bonds, cash, commodities, REITS, etc.

Keep a cash reserve for emergencies, keep some cash in your investment account to take advantage of opportunities as they arise.

Buy low, sell high - take your emotions out of the game. Start to buy when everyone else says sell and sell when your taxi driver is telling you to buy.

Be patient. It took 20 years for my first million. Then the miracle of compounding took over. Money makes money.

Be generous. I was born with caring parents, good health, and a fairly good brain. Not everyone has those advantages.

Spend some time and money to stay healthy.

Don't forget to have fun - fun does not have to cost a fortune. Dinner with the family, play with the kids, go for a walk, make some friends - otherwise what's the point of it all? He who dies rich is still dead. I've been rich and I've been poor, money is not the most important thing in this life.

Choose to be happy. You can't determine everything that happens to you in this life, but you can choose how you react.

Good luck.

If you're not temperamentally able to be a value investor, that is, buying when others are selling, all the books in the world won't teach you how to be one.

Here is what my wife and I have done for the last 30 years and it's worked well for us.

1. Maximize your 401k to the fullest extent of the company match.

2. Have additional money taken directly from your paycheck into an investment account. Diversify your holdings and rebalance. Study investing, use stop losses and buy put protection to protect your downside risk.

3. Pay off your credit cards each month.

4. Buy only the house you need.

5. Buy sensible cars. Few people really need a gas guzzling $50,000 SUV. Consider buying used, around two years old and plan on keeping for at least 10 years.

We do not make a lot of money. It's not important what you make, it's important what you keep.

Simple Formula for getting rich:
1. Make a good living in your job, profession, or business.
2. Save a high percentage of your earnings and don't marry a spouse who likes to spend, spend, and spend some more.
3. Don't carry any credit card debt or have a home equity line of credit.
4. Make good safe, non-speculative investments in a Low Cost S & P Index Fund and/or Total Stock Market Index Fund, and High Quality diversified municipal bonds (not bond funds, but individual high quality munis) for fixed income . Avoid managed funds.
5. Be tax efficient with your investments and personal affairs.

This guy is worse than Suze Orman. Get rich quick...yeah, right. I got rich slow. There are no secrets to getting rich quick except for the ones that get you thrown in jail.

Best way to get rich. Write a book about how to gett rich and sell it to saps who don't want to do the work.

Rules for Maintaining Wealth:

1.) Everyone wants to steal your money
2.) Everyone has an ulterior motive
3.) By the time its in the press, it's too late
4.) Don't believe brokerage stock ratings
5.) Everyone who approaches you is out to royally screw you
6.) Everything can go to $0
7.) There is no "safe" investment
8.) Hedge funds are betting against you
9.) The House always wins
10.) Don't buy it if you can't understand it

There is no free lunch. Becoming financially independent takes time, discipline, and perseverance. Rather than Greenblatt's book I recommend "Snowball" by Warren Buffet.

Joe Kennedy got it right: the best way to make a small fortune on Wall Street is to start with a big one.

And you say this guy is worse than Suzy Orman. Sounds like an impossibility to me.

Agree with Greenblatt, but it takes patience and knowledge of how to value a company. Most people don't, so they should index.

He should add two things. 1) Keep some of your investment funds in cash equivelents, maybe 10%. 2) When the stock market tanks and everyone believes that the apocolypse is near, have the mentality of a kid in a candy store, and use said cash to buy extremely undervalued, good companies.

My secret to get rich: always buy low and sell high.

Living minimally is the key to happiness; no wonder some of the happiest people are not in the west, they are in the east or on some islands who are living minimally.

The least you have, the less you have to worry.

Keep checking "WANT" vs "NEED" each time.

No Suze Orman is the worst, she just repeats what others, like Dave Ramsey, have already figured out.

I lost 70% of my life savings in the 2007 crash,I jumped out at the bottom,and tried to jump back in on aggressive investments to make up lost time,I'm 63 years old,lost the last 6000 dollars on PUDA Coal.Needless to say,this is not a strategy,but a disaster,to say the least.I wish you all good luck,but their is a flip side,I have slept better the last week,than I have since I was a kid and owned nothing in the market.

Well said Stephen C. One more suggestion for your list...
Autos are and expense. Too many people think a car payment is a way of life. Get what you need, pay cash if not get it paid for and keep it that way. Put the car payment in your savings every month.

I have followed this wisdom to financial success...Be fearful when others are greedy and be greedy when others are fearful. Somehow Buffet got credit for this truism but I have been using it for years and it has been true and simple.

At least the author is up front about peddling some book, but you had to read the whole thing to find the usual steer to mutual funds (ETFs in this case).

There is no formula strategy to make money in the market. The nature of the market and the circumstances affecting it change every day.

OK got it. Careful value oriented approach to stock picking combined with patience. If that doesn't work index and write a book.

The title "How the average investor can make a fortune" is incorrect.

By definition, the average will not be anything more than average.

You must be much BETTER than average to make a fortune. Many will think they are. Most are not.