KISS

I admit it—I am a big fan of Guy Fieri and his television show Diners, Drive-Ins, and Dives. Basically, Fieri drives around the country visiting local restaurants that serve their community and have a certain “hometown” feel to them. Fieri has a limited vocabulary for describing the dishes he tastes, but he is entertaining and seems like a genuinely good guy. Most of the time a great dish is said to be “off the chain,” as in Wow, this is awesome!

The last few episodes have been about diners, drive-ins, and dives in Italy. I’m not sure if the concept carries over to Italy, but Fieri has been exploring small mom-and-pop restaurants around Tuscany. I love Italian food—it’s my favorite cuisine. The ingredients are fresh, and most importantly, the dishes are simple; there is not a lot of complicated preparation and technique. The sauces are typically made of tomatoes, garlic, and onion. If you want to spice it up, throw in a pepper.

Investing should be the same way: simple. As I’ve said before, the keys to successful investing are: diversify, own broad-based indices, keep your costs down, stay the course, consistently invest new funds, and rebalance when necessary. Most mistakes are made when we let our brains interfere with our decision-making ability. Like cooking, the more you fuss with your investments (selling, switching, etc.), the more likely you are to ruin your dish.

I am also a big fan of Samuel Lee of Morningstar. Morningstar is an investment research company, and Sam writes and edits its newsletter, Morningstar ETFInvestor. He’s a smart guy. (If you’re on Twitter, follow him @etfsamlee.) Lee recently wrote a great piece outlining the importance of keeping investing simple. His point, in a nutshell, is that simple portfolios are easiest to understand. You can discern risk better—basically the concept that less is more—and there is not a lot of overlap in terms of strategies, ideas, and securities. The less complicated something is, the easier it is to understand. For example, I have an iPad and a Microsoft Surface. Both are tablets, but for the life of me, I can’t figure out how to operate the Surface; there are way too many movements and swiping gestures to remember. The iPad is the poster child of simplicity to operate. Turn it on, tap your app, and enjoy.

There is an art to keeping it simple, something I try to practice every day. Keeping it simple does not necessarily mean easy, but it is a way to have more time to enjoy the things you really want to do. I will leave you with a quote from a character I admire, Winnie the Pooh. Pooh is the Zen master of simplicity: “It’s more fun to talk with someone who doesn’t use long, difficult words but rather short, easy words like ‘What about lunch?’”