In the short run, you can lose money following your plan or you can make money deviating from it. When that happens, "good" behavior is penalized and "bad" behavior is rewarded. It weakens your commitment to following your strategy. If this continues, it isn't long before you're back where you started — making every decision on a what-seems-best-at-the-moment basis. Unless you have a rare and natural gift for investing, that's the last place you want to be.  

Even conservative strategies require self-discipline. To follow our Four Levels approach, to build a portfolio based on your emotional temperament, to stay with our fund selection and extensive diversification recommendations, all this requires self-discipline. The payoff is a conservative, workable strategy built around your specific, personal situation. It offers peace of mind. It fosters a long-term perspective. It's easy to understand and takes little time to implement.

Based on my 35+ years of investing experience, I've no doubt this approach, rather than the elusive promises of market timing, is the best long-term strategy for the average investor.

Posted June 24, 2009.

© Sound Mind Investing

Published since 1990, Sound Mind Investing is America's best-selling financial newsletter written from a biblical perspective. Visit the Sound Mind Investing website .

Request a free information packet regarding the Sound Mind Investing newsletter.





 Learn more about the newly updated 5^th Edition Sound Mind Investing Handbook, available at a 35 percent discount.