Investors can be more successful when they actively build discipline into their plan: i.e., when they don’t really have to think about it or exert willpower in order to execute it.
We believe that many small, consistent, steady actions compound into surprisingly impressive outcomes. The result of steady discipline over time is greater than most people expect. And yet, it’s how most people actually become wealthy. In contrast with “get-rich-quick” schemes, like speculating on lotteries, hot stocks, or options trading, steady discipline does not garner media attention or notoriety, but it is the engine of growth that purrs along quietly.
However, the more effort it takes to be disciplined, the less likely we are to succeed. Think about it: it is far harder to maintain a diet when surrounded by unhealthy food. It’s the same with our money. We must minimize the burden we impose on ourselves when trying to maintain discipline.
We believe in outsourcing some self-control and execution of our strategies to systematic implementations whenever possible. Automating savings and investment strategies like rebalancing and dividend re-investment are good examples of disciplined investing.