A New Year, A New Beginning, Buffet’s Timeless Investment Philosophy

By Ian Byrne CFP, Evolution? Financial

As the calendar flips to a new year, a wave of resolutions washes over the world. Weight loss, fitness aspirations, career advancement, and better financial management are common themes.

While these short-term goals are admirable, it’s essential to approach them with a long-term perspective. This is where the art of investing aligns seamlessly with the spirit of New Year’s resolutions.

Warren Buffett, the legendary investor, often emphasizes the importance of patience and discipline. These qualities are not just virtues for investors but also for those seeking to achieve their personal goals. Just as patience and discipline and convert thousands to millions in wealth over time, so too with the right strategies, mindset and most importantly discipline, your resolutions

> become good habits, which with repetition in time ?

> become a natural almost unconscious part of your lifestyle,

> and your results begin to show and compound and increase

(interestingly, you'll also begin to look forward to that burn in the muscles that you initially dreaded or/and feel proud of yourself for not buying that expensive ‘blah’ that you’ll never miss anyway while watching your bank balance grow).

Two of my favourite Buffett sayings are “You only have to do a very few things right in your life so long as you don't do too many things wrong” and “Chains of habit are too light to be felt until they are too heavy to be broken”. Both hold true not only for investing but essentially all aspects of life.

When setting New Year’s resolutions, (which often are a catalyst to begin ‘making things right’), we've all already heard to not overwhelm yourself with too many changes, nor set unrealistic expectations. The flip side & practical aspect of that is that it’s logical then to focus on areas where you have the ability and skills to succeed or seek assistance or professional help to do so.

Being accountable to others can often allow us the opportunity to enforce discipline we otherwise may not have, which can then help cement the good habits and lifestyle choices that are gradually incorporated into our own innate sense of self.

Financial security is a common New Year’s resolution. To achieve this, it’s essential to start early and invest regularly, however it is also never too late to start when aiming to improve your situation. Just like with health goals, consistent effort and time are powerful allies in the world of investing. The longer your money has to grow, the more significant the returns.

Buffett often advocates for a “buy-and-hold” strategy. This involves purchasing quality stocks and holding them for the long term, regardless of short-term market fluctuations. This approach can be applied to other areas of life as well; if you’re aiming to improve your health, focus on sustainable lifestyle changes rather than quick fixes.

While investing requires careful analysis and research, it’s also important to remember that it’s a long-term game. Don’t get too caught up in daily market movements. Instead, focus on the underlying fundamentals of the businesses you’re investing in. As the Oracle from Omaha states “Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.” A ‘Warren & Charlie, dynamic duo’ key principle is to avoid emotional decision-making. Fear and greed can lead to impulsive actions that can harm your financial well-being. Similarly, when pursuing personal goals, it’s essential to stay calm and focused, even when faced with setbacks.

As Buffett often says, “It’s better to hang out with people better than you. Pick out associates whose behaviour is better than yours, and you’ll slowly rise to their level.” Surround yourself with positive, motivated individuals you admire with enhanced acumen in desirable areas who can inspire, challenge and support you. ?

As we embark on a new year, it cannot hurt to approach our resolutions with the same level of logic, thoughtfulness and care that a seasoned investor would approach their portfolio. By focusing on what we can control, avoiding unnecessary risks, and staying true to our long-term strategy & goals but flexible enough that we can make necessary changes or tweaks, we can create a brighter future for ourselves.

Finally, don’t be afraid to fail. Mistakes are a natural part of the learning process. The key is to learn from them and move forward. Buffett once said, “Someone is sitting in the shade today because someone planted a tree a long time ago.” By planting the seeds of success today, we can reap the rewards tomorrow, whether it be financial, health, relationships or general well-being.

Buffett’s wisdom can be applied to various aspects of life, not just investing. By adopting his principles of patience, discipline, and long-term thinking, we can set ourselves up for success in the coming year and beyond.

(Warren Buffet, globally known as a financial guru... but approaching 95 years old with mobility and full mental faculties plus a string of achievements across the board, could also possibly be considered a lived health expert, philosopher, philanthropist, business consultant, social commentator and an example of a life well spent. Perhaps even more reason to listen to his words when focusing on your New Year resolutions - what do you think?)

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* The above is general information only and not personal advice. For further information or a confidential discussion, please contact the author directly.