Dear Dave,

I’m just starting to dip my toe into investing, and I was wondering what you think about bonds. I would appreciate any other advice you have on investing, too.

– Joseph

Dear Joseph,

For starters, I don’t buy bonds. Bonds are frequently pitched in the financial world as being much safer than the stock market, but actual data shows they’re not that much safer.

The bond market, in general, is almost as volatile as the stock market because of the way bond values respond to shifting interest rates. And on top of all that, the returns are not nearly as good.

I’ve got millions of dollars in the market, and I don’t own a single bond. Not one. I also don’t own any single stocks, because I don’t like the risk involved.

Instead, I own mutual funds. A mutual fund contains anywhere from 90 to 200 different stocks.

I love mutual funds. Love them! Let’s say I put $100,000 into the market. Nothing in bonds, nothing in single stocks. All of it goes straight into a good, growth stock mutual fund.

Again, we’re talking about 90 to 200 of some of the best companies in the world. At this point, the only real risk you’re riding is the overall, general risk of the stock market as a whole.

You’re not betting the farm on one company based on your golfing buddy’s “hunch” – which is how way too many people play single stocks.

I also don’t trade stocks or mutual funds on a daily basis. I have a long-term, buy-and-hold mentality when it comes to investing. Do you remember the old story The Tortoise and the Hare? I’m perfectly fine to be the tortoise in my investing approach. Why? Because even though it’s not flashy or exciting, the tortoise wins every time.

Keep this in the back of your mind, Joseph. If all your broke friends are impressed with your investing, chances are you’re doing it wrong. Or at the very least, you could be doing a whole lot better!

– Dave

• Dave Ramsey is an eight-times national bestselling author, personal finance expert and host of The Ramsey Show. He has appeared on Good Morning America, CBS This Morning, Today, Fox News, CNN, Fox Business and many more. Since 1992, Dave has helped people regain control of their money, build wealth, and enhance their lives. He also serves as CEO of Ramsey Solutions