Someone flew down from the cold north to my warm Caribbean island this week to talk to me about successful investing. The visitor wanted someone to teach them how to make a lot of money in the stock market in a short period of time. I told them the learning curve was too high and too long.
That when you’re young money is important and time isn’t. But as you get older, time becomes more valuable than money. You can’t really buy more time.
I recommended staying dumb and not learning. Pay someone who has done the learning curve to do it for you, and spend the time with those you love and care about. A day on the beach spent with your children is more important than learning the complex financial consequences of a ‘green shoe.’
It wasn’t what my visitor wanted to hear, and it came across as self-serving. But I’ve spent over twenty years learning about investing and I’m only smart enough to know I’m still learning. Someone in their later years worrying about retirement and health care costs does not have enough time to learn, pay for their mistakes, and rebuild.
My visitor, who had read about me in ‘The Warren Buffetts Next Door,’ came well prepared and asked a lot of good questions. But, in my opinion, this individual was too eager and too confident.
I said to wait and stay out of the market until investors were really scared. Then begin investing. Or, if they must, put just a small toe in right now, with the S&P 500 Index (SPX) hovering around 1,900, and then wait…that now was not the time to jump into this market with your whole body, soul, and retirement account.
Again, it wasn’t what they wanted to hear. My kids will never forgive me for the amount of business I turn away…But they will enjoy the day at the beach. And so will I.
Photo Credit: jjjj56cp
DISCLAIMER: The information in this material is not intended to be personalized financial advice and should not be solely relied on for making financial decisions. Past performance is no guarantee of future results.
I am a self-taught individual investor and a portfolio manager with more than 20 years of experience. I focus on deep value and special situation investing. You can read more about me and the unique way I became a portfolio manager on my own website, located below my picture.
I believe, my personal investment expertise is in creating and managing concentrated investment portfolios.
I am featured in the book The Warren Buffetts Next Door: The World's Greatest Investors You've Never Heard Of and What You Can Learn From Them by Matthew Schifrin.