The Simple Path to Wealth

Your roadmap to a rich, free life — in just five minutes per week.

August 18, 2026

"I love this overview of the incredible bull market we are enjoying," JL writes in, "Especially the point that the Magnificent Seven are now the laggards, and the other 493 stocks of the S&P 500 are the ones leading the market further up.

It wasn’t too long ago my inbox was filling up with great concern that index funds were failing because of the Mag 7’s success. Now it's the very opposite. No one did or could have predicted this change, but in owning VTI/VTSAX, we didn’t have to.

Also compelling is the fact that as strong as the market has been, the underlying earnings have been even stronger."

THE SIMPLE NUMBERS

More than seven million American adults aged 65 or older were renters in 2023, according to a report from the Joint Center for Housing Studies at Harvard University. That was about 20% of retirement-age households.

That share is likely still growing. A 2025 report from JCHS found "the number of renter households age 65 and older increased by 8.1 percent" between 2019 and 2023.

But cost remains a problem: That 2025 study found 58 percent of older renters were "cost-burdened," meaning they spent more than 30% of their income on housing and utilities.

SIMPLE PATH OF THE DAY

A slice of timeless wisdom from The Simple Path to Wealth:

"Houses are an expensive indulgence, not an investment. That’s OK if and when the time for such an indulgence comes. I’ve owned them myself. But don’t let yourself be blinded by the idea that owning one is necessary, always financially sound, and automatically justifies taking on this 'good debt.'"

ASK JL

Q: Most financial independence experts talk about how smart it is to rent in big cities. However, there is little talk about how renting in retirement will affect your stability (i.e. with rent increases). Is buying a home with a lump sum cash payment when you hit FI a reasonable move? What do you think? —Ryan D.

Hi Ryan…

This is a tough question to answer as there are so many variables. That said, let’s look at the issues you raise.

While rent will certainly increase, so will the costs of owning and maintaining a home, HOA fees, real estate taxes, insurance. Those things may well add stress. Choosing to rent or to own just changes the kind of stress.

Renting provides liquidity, flexibility to move if needed (to assisted living, for instance) and far more predictable costs. No sudden roof replacements, for example.

Owning means you don’t have to worry about the landlord not renewing your lease—or if, when, and how needed repairs will be made.

As for whether "buying a home with a lump sum cash payment when you hit FI is a reasonable move," this depends on how much you’ll have left in investments to support your lifestyle. It's a terrible idea if it leaves you "house rich and cash poor." Fine if you do it from a position of strength.

All this said, if I have learned anything from when I first published a blog on homeownership back in 2012, it is this: People buy or rent based on what they emotionally want to do.

—JL

Got a money question keeping you up at night? Reply to this email and we'll get it over to JL.

People and a tour vehicle in a european town square — These look fun—to own or to rent!

WHAT WE'RE READING

📚 JL flagged this post from Ben Carlson at A Wealth of Common Sense and says it reflects an old maxim: "Be careful what you wish for."

📚 And if you're thinking about renting at another stage of life, check out this vintage guest blog from a couple followers of The Simple Path: "Yes, you can rent with kids!"

📚 Here's Ramit Sethi on what it means to be "house poor"—and what the real costs are to your life.

THE BIG QUESTION

Did there come a time in your life when renting no longer made sense to you? Or did you give up a house you owned in order to rent? Did reaching retirement age change your calculus?

Reply to this email and we'll feature some of your responses in upcoming issues!

Since last time, we got a few more notes from readers around how they're following The Simple Path from outside the U.S...

I live in the Netherlands. I invest in worldwide ETFs and index funds using brokerages (Meesman, Brand New Day, and Saxo). I also have the Dutch equivalent of a traditional IRA through Brand New Day (a "pensioenbeleggingsrekening" with income tax benefits). In the Netherlands, a lot of employers still offer a pension fund, and personally I've built up nice pension fund benefits over my career.

I'd like to advise people in the Netherlands to always understand your retirement options. Some employers have started offering retirement accounts with an insurance company, but often too little money is put in and/or the default investments are terrible. If you know, you can do something about it. I plan my retirement in two stages: I will fund early retirement with money from my investments, and then when social security and pensions kick in, I will live on those mostly, with a bit of extra income from my investments if needed or wanted. —Petra H.

Ciao JL, I'm writing from Italy, and I wanted to share how I follow The Simple Path from my beautiful country. Here, investing is still a bit different compared to the US. Many people still rely on bank or insurance investment products, often without realizing how much costs can impact their long-term returns. Low-cost index investing is becoming more popular, but there is still a lot of work to do in terms of financial education.

My approach is quite simple. I invest through low-cost UCITS ETFs available in Europe:

VWCE for global stocks
EGOV for European government bonds
DBMFE for managed futures.

I added managed futures because I wanted a little more diversification after experiencing 2022, when both stocks and bonds suffered a significant decline at the same time. It reminded me that even a simple portfolio needs to be prepared for different market environments.

I discovered your book about two years ago, and it honestly made me very happy to find such a clear and simple way to think about investing. I have to give credit to an Italian financial educator, Mr. RIP, who shared that The Simple Path to Wealth was one of his favorite books about personal finance. —Marco P.

In France, the easiest way for me to start investing was by opening an investment account with Revolut. I already use it as my payroll account, and my Premium subscription includes five commission-free investment transactions each month, making it a convenient choice.

At the moment, I'm investing in the VUAA (Vanguard S&P 500 UCITS ETF — Accumulating), which gives me broad exposure to the U.S. market. For investors looking for greater international diversification, another popular option available in Europe is VWCE (Vanguard FTSE All-World UCITS ETF). —Mazen D.

I live in Switzerland, and based on my research, the best investment platforms for Swiss are either the local platform Saxo Bank or the international platform Interactive Brokers.

Because the Swiss franc has historically tended to strengthen against virtually all other currencies over the long term, I have invested about one third of my portfolio in an ETF that tracks the entire Swiss stock market (SPI index). The remaining two thirds are invested in an MSCI ACWI (All Country World Index) ETF.

If you prefer to keep things even simpler, you can also invest your entire portfolio in the latter. In my opinion, both approaches are perfectly reasonable and are likely to pay off over the long run. —Marco S.