By The Book

By The Book

“I am really no different from any of you. I may have more money than you, but money doesn’t make the difference… If there is any difference between you and me, it may be that I get up every day and have a chance to do what I love to do, every day. If you learn anything from me, this is the best advice I can give you.” – Warren Buffett

We are designed to seek nourishment, shelter and community. Though we tend to compete for these things, at least some of the time, the underlying impetus to attain any greatness or wealth is a desire to surpass what we are presently. In spite of all our wavering confidence, something inside knows that we are capable of grand accomplishments. We are, at times, clueless survivors, but survivors nonetheless.

The dream of wealth is not limited to the number of digits in our bank account balance, the value of a house or investment. Instead, it may be an extension of the very basic desire to feel secure. Some people feel secure with a $1,000 a month income. In fact, some feel quite wealthy with very little. It is a matter of perception; not necessarily a matter of social standing.

Regardless of our financial circumstances, it pays to be informed, to have a personal understanding of the resources at hand and to have a plan. It is fine to be satisfied with less, but it is also wise and sensible to know how to manage what we have, whatever this may be.

Enters “The Lazy Person’s Guide to Investing”. A totally entertaining, instructive and very well-written gem of a book. It is loaded with easy-to-understand strategies for all who want to build a sound financial future, but do not necessarily want to spend time watching, buying and selling stocks. It is ideal for the young couple who is trying to plan ahead for their first home or for the investor who seeks more creative, less time-consuming means of securing a good portfolio.

I have read this book more than once, have experimented with some of the strategies it proposes and I am glad I did. Here is an example that delights me to this day:

Picture if you will a 401 K plan with an employer. Month after month, the losses pretty much bring the rock-size gains down to fine dust. It is mind boggling. They say there is a silver lining to every tragedy. There is. The shock: Job position is eliminated. The move: Find a new home for the 401 K. The moment of enlightenment: Play by the book, this book. The silver lining: Two years later, with no further investment, the initial investment into a no-load, no-fee Mutual Funds account increased by 60%. The trick for this laziest of all lazy investment strategies, is the power of compounding. Over a period of 20 years, economists have observed, regardless of the ups and downs of the market, Mutual Funds come out above waters time and again. I am testing this as we speak. Perhaps I’ll write about it again in 15 years or so!

Investing is as much about personality as the choice of furnishings we place in our homes and the choice of career we embark upon. Society, and certainly the media, provide many examples of how the “successful” people of this world spend their money, invest it and live. We can certainly use these role models as examples of confidence and assertiveness. As Warren Buffett points out, most of the really wealthy people in the world got to that point by doing what they love. Their wealth is a product of their quest to follow a passion, not the other way around.

(Pall Spera Company and Paschal MacMurray are in no way affiliated with Amazon.com. The link from the book title to the Amazon page is provided solely for convenience).