My favourite pieces of investment advice from the experts
Written by Carl Turner on March 27, 2017.
As a financial adviser I spend a lot of time musing about the best way to go about saving and investing. I want to ensure that my clients fulfil their financial goals so that you they live life to the full both while they are working and beyond into retirement.
There are some key pieces of timeless wisdom which apply to all investors whether you have thousands or millions to invest, and I come back to these time and time again. Here are some pearls of wisdom of some of the most successful investors ever, advice well worth listening to!
Investment guru: Sir John Templeton (1912-2008)
Investment advice: "Invest at the point of maximum pessimism."
Templeton built a fortune running to billions by sticking to his mantra of bucking investment trends and buying when everyone else was selling. During the depression in the 1930s, he bought 100 shares of every stock trading below $1 in the US. His total investment of $10,400 sold for over $40,000 four years later.
Investment guru: Robert G Allen
Investment advice: "How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case".
Allen has written a string of books about investing. I concur with him that cash deposits are a poor choice for investing your money and never more so than since the global financial crisis hit when interest rates have been languishing at historically low levels. Keep a stash of cash in the bank for emergencies but invest the rest of your savings elsewhere.
Investment guru: Thomas Rowe Price Jnr (1898-1983)
Investment advice: "Most big fortunes result from investing in a growing business and staying with it through thick and thin."
Rowe Price Junior believed that investing is a long-term game. He favoured a strategy of buying and holding stocks in good companies over an extended time period. This approach is one that I also favour – history has shown that quality stocks held over a long timeframe will almost always rise in value despite the short term ups and downs.
Investment guru: Robert Kiyosaki
Investment advice: "It’s not how much money you make, but how much money you keep, how hard it works for you and how many generations you keep it for."
Kiyosaki, an outspoken and often controversial entrepreneur, investor and author, is making the point here that you can earn as much as you like but if you fail to invest some of it, your financial future will be bleak, as will that of your loved ones. Live for today but also plan for tomorrow by making a conscious effort to save a percentage of your income on a regular basis. This quote also points out that you need to invest wisely to make the most of your money.
Investment guru: Benjamin Franklin (1706 – 1790)
Investment advice: "An investment in knowledge pays the best interest."
The better informed you are, the better the decisions you will make. So said this founding father of the United States and so say I! Educate yourself to become financially literate, an area which is sorely neglected in formal education. Understanding basic concepts such as budgeting, compound interest and diversification will empower you and enable you to take control of your finances and make sensible decisions about saving and investing which will have a profound effect on your wellbeing.