At MarketWatch, Paul Farrell reproduces the nine-point, 129-word "Unified Theory of Everything Financial" originated by Scott Adams (of Dilbert fame) in "Dilbert and the Way of the Weasel," published in 2002. Farrell suggests that Adams should be considered for the Nobel Prize in Economics:
1. Make a will
2. Pay off your credit cards
3. Get term life insurance if you have a family to support
4. Fund your 401k to the maximum
5. Fund your IRA to the maximum
6. Buy a house if you want to live in a house and can afford it
7. Put six months worth of expenses in a money-market account
8. Take whatever money is left over and invest 70% in a stock index fund and 30% in a bond fund through any discount broker and never touch it until retirement
9. If any of this confuses you, or you have something special going on (retirement, college planning, tax issues), hire a fee-based financial planner, not one who charges a percentage of your portfolio.
You can quibble a bit. Somewhere on the list should be such things as "buy groceries" and "pay the light bill". But it is simple and elegant.
(Adams would be the first to tell you not to take financial planning advice from a cartoonist.)
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