Jack Bogle’s Money Smart Advice for Anyone Nearing Retirement

The late John C. Bogle, who died in January 2019, built a legacy around a simple but powerful idea: investors do not need to be market experts to succeed. They simply need to minimize costs, stay disciplined, and let compounding do the heavy lifting. As the founder of The Vanguard Group, which now manages more than $11.6 trillion in assets, Bogle helped popularize low-cost index investing. His philosophy continues to guide millions of investors today, especially those nearing retirement. Investors who embrace Bogle’s principles of low-cost index funds, diversification, and long-term discipline are affectionately known as Bogleheads.

At its core, Bogle’s counsel emphasized maintaining an appropriate asset allocation and avoiding excessive risk. That may not sound groundbreaking, but a surprising number of retirees shoulder more risk than they can actually afford. After three consecutive years of exceptional gains, markets entered a period of heightened volatility in 2026. Corrections at the individual stock level have tested investor resolve even as major indexes have largely held up.

Both the Vanguard S&P 500 ETF (NYSEARCA:VOO) and the Vanguard Total Stock Market ETF (NYSEARCA:VTI) have weathered periods of turbulence this year, prompting some soon-to-be-retired Bogle followers to wonder whether their equity allocation runs too hot. How much equity exposure is too much for a retiree? Can you take excessive risk even in the supposedly safer world of bonds?

These questions deserve careful answers, and Bogle’s cautious but optimistic investment beliefs offer a useful framework for thinking through them.

The stock market may deliver lower returns going forward. Accept that reality

The S&P 500 delivered total returns of roughly 26% in 2023, 25% in 2024, and 18% in 2025, a three-year run that set a high bar for expectations going forward. Before that streak, three consecutive years of 15%-plus returns had occurred only a handful of times in the past century. Goldman Sachs (NYSE:GS | GS Price Prediction | GS Price Prediction) had a year-end S&P 500 target of 7,600 as of late April 2026, implying roughly 6% upside from then-current levels. By late May, the firm raised that target to 8,000, citing an exceptionally strong first-quarter earnings season. The revised forecast projects S&P 500 earnings per share of $340 for 2026, representing 24% annual growth, with AI infrastructure beneficiaries accounting for roughly half of that gain.

Even so, the core message for retirees remains unchanged: returns are moderating from the blockbuster gains of the prior three years. Chasing above-average results means accepting above-average risk. A heavy bet on concentrated tech positions might outpace the broader market over some stretch of time, but if that trade sours more sharply than the S&P 500, you could end up trailing even a modest benchmark. Unless you have decades remaining in your investment timeline, settling for market returns at market risk makes far more sense than reaching for excess gains. Elevated valuations leave little margin for error, particularly for investors who cannot afford to wait out a prolonged recovery.

Bonds carry risk, too

Retirees should aim for an asset allocation that matches their risk tolerance. The classic 60/40 or 40/60 stock-to-bond splits remain popular starting points, though the right mix varies widely by individual. Either way, bonds are not foolproof safe havens. The 2022 stock and bond market selloff was a stark reminder: both asset classes declined together for the first time since 1977, driven by the Federal Reserve’s aggressive rate-hiking campaign. Stocks and bonds have historically moved in opposite directions, providing genuine diversification benefits, but inflationary conditions can push them into the same downward spiral at the same time.

Fixed income carries its own hierarchy of risk. Some bonds offer greater safety than others, and the safer ones typically deliver lower yields. Retirees who chase yield in the bond market may believe they are capturing better returns in a conservative asset class. In practice, higher-yielding bonds carry significantly more credit and duration risk, and they can behave much like equities during downturns, defeating the entire purpose of holding them in the first place.

Bogle emphasized keeping an appropriate asset allocation and avoiding excessive risk, particularly in retirement. For retirees seeking to follow that advice, a low-cost basket of high-quality bonds is the most sensible approach. The Vanguard Total Bond Market ETF (NASDAQ:BND) is a widely used core fixed-income holding that tracks the broad U.S. investment-grade bond market at an expense ratio of just 0.03%. The goal is to keep fees low and the investment plan as simple as possible, two enduring pillars of the Bogle philosophy.

The bottom line

Bogle’s philosophy makes the point plainly: investors nearing retirement must stop accepting undue risk in pursuit of better returns. Risking a comfortable retirement for the chance at a great one makes no sense if it means potentially working several more years. If market returns moderate in the years ahead, the right response is to accept the returns that come with an appropriate level of risk and adjust the retirement plan accordingly. Save more if needed, or work a bit longer if the numbers demand it, but keep your nest egg positioned for sustainability rather than speculation.

Editor’s note: This update corrects Vanguard’s assets under management to more than $11.6 trillion (reflecting late-2025 reported figures), clarifies that Goldman Sachs held a year-end S&P 500 target of 7,600 as of late April 2026 before raising it to 8,000 in late May, and adds BND’s 0.03% expense ratio. The S&P 500 total returns of roughly 26% in 2023, 25% in 2024, and 18% in 2025 are confirmed from historical return data.

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