Fortune favours the bold – isn’t it time you invested the Warren Buffett way?


After vowing to do more exercise, eat more healthily and learn a new skill, putting your finances in order is probably up there among your new year’s resolutions.

If it isn’t, it should be, particularly when it comes to your investments. After all, they make up the pot that you’re pinning your hopes on to provide for you in later life.

You may know how much you’re putting in each month, but what’s going out in fees? What are you getting back and will it be enough to sustain you in your time of need? Do you even know how much you’ll require?

If you feel you could be doing things better, now’s a great time to take that bold step and get to grips with your finances.

Ignore the so-called experts

Start by taking a lead from Warren Buffett, a revered figure in the world of investing and yet most not only fail to follow his advice, they do exactly the opposite.

The fourth richest person in the world, Buffett has amassed an $86 billion fortune. His advice to investors is not to ‘play the market’ or take any notice of forecasts or so-called experts.

“We have long felt that the only value of stock forecasters is to make fortune-tellers look good” is among many memorable Buffett quotes, as is: “Our favourite holding period is forever.”

Buffett’s strategy is a one that’s frequently based on funds that are ‘passively managed’, as opposed to the frequent buying and selling of ‘actively managed’ funds – the approach taken by most UK investment companies.

Relax and take a long-term view

Longer-term holdings enable Buffett to accrue more shares when the markets are low – a time when most others are selling – and gain from subsequent growth.

The low fees of the passive investing approach also help to boost returns compared to those from actively managed funds, which are frequently eroded by higher fees.

Buffett’s ‘sensible’ strategy is one we follow (highly successfully) at BRWM and we’re keen to spread the word to others. In fact we even wrote a book with Larry Swedroe called ‘Think, Act, and Invest Like Warren Buffett’ and set up our own YouTube channel – Sensible Investing TV.

Our clients certainly embrace the Buffett approach which we combine with in-depth review and planning, setting goals that are based on the lifestyle they want to lead.

Not only do they feel in control of their finances, they know not to waste time worrying about any stock market dips – or anything the forecasts say.

At this time of year it gives them more time to focus on their resolutions.

More sit ups, anyone?