Rather than try to dazzle you with my own wisdom, here are a few choice comments by folks who really know the ins and outs of investing. If you spend 10 minutes reading the following, you will be more knowledgeable about money management than 90% of the people who are in the stock market today.

– Jeff


“The best course is to invest regularly in quality companies or well-run mutual funds, ignore the markets ups and downs, and cover your ears when the ‘experts’ are talking. It takes a long time to make enough money to retire, and rushing the process will only ensure failure.”

– Robert Torray, manager, The Torray Fund

“When the markets are choppy, the best approach is usually to sit tight, make sure your portfolio’s asset mix and your long-term investment strategy are sound, and simply ride out the storm.”

– Gus Sauter, Chief Investment Officer, Vanguard Mutual Funds

“Investing is not a game where the guy with the 160 IQ beats the guy with the 130 IQ. Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing.” (emphasis mine)

– Warren Buffett, richest man in the world

“Successful investing isn’t about knowing more than anyone else. It’s about having the discipline to stick with your plan regardless of the latest headlines. Realize that occasional market declines can actually be beneficial, allowing you to buy stocks at bargain prices”

– Austin Pryor, Investment Advisor and Author, Sound Mind Investing, Dec. 2007

“Stocks are about the only thing people avoid when they go on sale.”

– Warren Buffet, Financial Planning, August 2007

“Panic and greed are not investment strategies.”

– Liz Ann Saunders, Chief Investment Strategist, Charles Schwab & Co.

“When it comes to investment information, make like an ostrich: stick your head in the sand. If you’re a long-term investor, how your portfolio performs today or tomorrow is irrelevant.”

– Wall Street Journal columnist

“I have no idea what the market will do next week, or next month, or next year. Zero. I don’t think about it, and if I did think about it, it wouldn’t do any good. The main thing the investor needs is the proper temperament. He doesn’t need to have an IQ of 150. He doesn’t have to be an expert in accounting. But he does have to keep his balance when untoward things happen in the market. The reason investors do poorly is they beat themselves. The Dow went from 66 to 11,400 in the last century. You’d think it would be pretty hard not to do well when the Dow moves from 66 to 11,400. The people who didn’t do well were the people who panicked and sold when stocks were very unpopular or bought at high prices when stocks were very popular. So, you have to have an emotional stability. If you have an emotional stability and stick with American businesses, you’re going to do fine.”

– Warren Buffett, richest man in the world (SMI, May 2007)

“Don’t let your emotions drive your investment program, because you will be thinking of getting in and out. For investors the best rule is by and large to ignore the daily moves of the stock market. The stock market is a giant distraction for the business of investing.”

– John Bogle, Founder, Vanguard Investments, second largest mutual fund company

“It is the passage of time that gives most approaches to the stock market the chance to work. I’m not talking about weeks or months, but years. Most of us, by nature, are results oriented. Without performance, we lose interest. As such, lack of patience is probably the single greatest impediment to success in the stock market. Remember, success in the market takes time.”

– Sir John Templeton, legendary international investor (SMI, Feb. 2008)

“[To be successful investors] people don’t need extraordinary insight or intelligence. What they need most is the character to adopt simple rules and stick to them.”

– Benjamin Graham, noted investment analyst (SMI, Feb. 2008)

“Against all reasonable expectations, we seem to somehow expect to astutely select the cream of the investment crop, ride our holdings to the crest of a glorious market, and then wisely take our profits. We’ll move to the sidelines and let other (presumably less savvy) investors suffer the frustrations of the inevitable correction that follows. When we think like this, we’re living in a fantasy world, and when our fantasies don’t come true, we often react with bitter disappointment anger or fear.”

– Sound Mind Investing Newsletter

“It cannot be said too often that the road to ruin lies in dogmatizing on charts, systems and generalizations.”

– William Hamilton, 1909, Editor of Wall Street Journal

“[How does an investor get a good night’s sleep?] Be balanced, be diversified, think long-term, and tune out the noise. Don’t feel compelled to look at the prices in the paper or watch the financial shows on TV every day. You’ll get euphoric in the good times and despondent in the bad. Your investment provider’s job is to help you create wealth in the long run. Not in the next two weeks, not in the next news cycle.”

– John Brennan, Chairman, Vanguard Investments, 2nd largest mutual fund company

“Part of the problem is that, while some news does involve sharp and sudden stock reactions (only when it involves surprise), most of the never-ending flood of daily news is routine, insignificant and meaningless in terms of durable impact. It is important to PR firms, journalists, TV reporters and traders because it gives them a means of making a living. But to the long-term investor, it is little more than filler and noise.”

– Individual Investor newsletter, June 2008

“What matter for more than ups and downs [in the market] is your ability to make progress toward a specific goal, such as buying your first home, paying for your children’s college education or funding a secure retirement. In my experience, the best way to achieve such progress is to create a long-term investment plan and then stick to it. . . . I’ve been observing Wall Street for four decades — long enough to know that short-term movements in the market are just that: short-term. Investors who stick with a well-conceived, long-term plan will still be reaping the benefits when today’s headlines are long forgotten.”

– Charles Schwab, Chairman, Charles Schwab & Co.

“If you haven’t been investing with borrowed money, then you can survive any bear market. You can just maintain your strategy and wait it out. But that’s looking at it negatively. Lower stock prices are bad only for people who have to sell. They offer temporary bargain prices for people who have the money to buy.”

– Austin Pryor, Sound Mind Investing, Aug. 2008

“You will never go broke taking a profit.”

– Bernard Baruch, 1928, Wall Street tycoon and presidential economic advisor


“Research has shown that managing savings and spending rates is the single biggest determinant of financial success. I’ve always found this knowledge comforting because managing these two variables is something every individual can do. We have no control over markets going up or down but we can control our own spending and saving.”

– Charles Schwab, On Investing, Summer 2008

“Annual income 20 pounds, annual expenditure 19.6, result: happiness. Annual income 20 pounds, annual expenditure 20.6, result: misery.”

– Charles Dickens


“Tax refunds can feel like found money — but it’s important to remember that you worked hard to earn that cash. Keep in mind that a big refund means you paid too much in taxes the previous year, in effect giving the government an interest-free loan. Instead, ask your employer to reduce your tax withholding so you won’t overpay your taxes. You may be able to significantly improve your financial prospects by making sure that your money works equally hard for you.”

– Schwab Investor, Feb. 2007


“Unfortunately, plenty of otherwise rational Americans take the money from their 401(k)s when they leave a job and spend it. In a 1995 study released by the U.S. Department of Labor, 68% of the Americans over the age of 40 who changed jobs cashed out on their 401(k). And a staggering 84% under the age of 40 took their money instead of rolling it over into another tax-deferred investment plan. This is sheer lunacy.”

– Knute Iwaszko and Brian O’Connell, authors – “The 401(k) Millionaire,” (SMI June 2007)


“Attempting to forecast whether the market is at a peak or in a valley — and whether to buy or unload stocks as a result — is a waste of time. I don’t know anyone who has been right more than once in a row.”

– Legendary investor Peter Lynch

“After nearly 50 years in the business, I do not know of anybody who has done it [market timing] successfully and consistently. I do not even know anybody who knows anybody who has done it successfully and consistently.”

– John Bogle, Founder of Vanguard Mutual Funds

“Trying to time the market in a dangerous game, fraught with peril. Buffet doesn’t do it. Nor do we. The truth is, we don’t know what’s going to happen tomorrow. Nobody does. But we do know that buying and holding a onto a broadly diversified portfolio of undervalued stocks through good times and bad pays off in the end.”

– John Buckingham, editor, “The Prudent Speculator” newsletter

(On market timing) “As you watch and wait [for the market to go back up], it’s easy for a kind of paranoia to creep into your thinking: ‘The market will probably fall again soon, and the drop will likely start the week, if not the day, after I get in!’ The truth is, of course, that the market doesn’t know you exist. It’s going to do what it’s going to do, based on the economy and corporate profits, whether you’re in or out. Over the long haul, it’s going to go up. Your prosperity will will be enhanced if you let your capital ride along with it.”

– Austin Pryor, Investment Advisor and Author (SMI, March 2007)

“It’s important to keep in mind that since we can’t know the future with certainty, no investment portfolio will ever be perfectly positioned to profit from upcoming events. In retrospect, it is always possible to point to ways we could have made more money (or lost less money) than we did. The human inability to make fully accurate predictions means it’s pointless to think of the ‘right’ investment portfolio simply in terms of making the highest possible profit. If that is your approach, you will always be second-guessing your decisions, and you’ll end up frustrated and disappointed.

“Instead, the ‘right’ portfolio is one that realistically faces where you are right now, looks ahead to where you want to go, and has a very high probability of getting you there on time.”

– Austin Pryor, Investment Advisor and Author (SMI, January 2009)

“The sole reason why [we don’t] pay any attention to general market factors is that we are no good at making such prognostications. We don’t think anybody else —perhaps with the exception of a few geniuses who are unknown to us — is any good at it either.”

– Marty Whitman, Manager, Third Avenue Fund, former Morningstar “Fund Manager of the Year”

“I worry about people trying to trade their way to success, rather than buying and holding. Don’t try to time the market unless you do it for a living — and even then it’s very hard to do.”

– Lee Kranefuss, Barclay’s Global Investors


“When someone with experience proposes a deal to someone with money, too often the fellow with money ends up with the experience and the fellow with experience ends up with the money.”

– Warren Buffet on hedge fund managers