You’ve probably heard the expression, “work smarter, not harder.” This advice can be helpful when it’s used in the context of streamlining an unnecessarily inefficient task. For example, if you’re trying to cut grass, you’d probably be better off using a riding lawnmower than a pair of shears. If you cut the grass by hand, you’ll probably spend the entire day working on it and you’ll feel like did backbreaking work you’ve finished. Riding the lawnmower, you may not even break a sweat, but you’ll finish in an hour or so and you’ll have plenty of time and energy to accomplish other tasks with the rest of your day.
Working hard for the sake of feeling like you worked hard is typically not a good move. If you think through the task beforehand and use the appropriate tools or systems to tackle the project, it will generally be a lot easier and go a lot faster. Yes, “work smarter, not harder” is generally a good maxim to live by.
The trouble comes when people try to reverse the direction of the expression. While it may be true that working on a task more intelligently will make that task easier, it’s often not the case that simply putting less effort into the task will make the work put into it more intelligent. Taking a shortcut is only a good idea if it actually gets you where you’re trying to go.
Suppose you are trying to learn a new language. Of course, you want to learn the language well enough to become fluent, but you also want to learn it as quickly as possible and put in as little effort as possible. You decide to do some research and find two different methods. First, you could use an application that requires two hours of rigorous daily practice for an entire year. Then, there’s another option in which you can listen to an audio track while you sleep each night and learn the language in three months. Which method do you think would be best?
The first method will be a challenge and takes a long time but, at the end of the year, you’ll probably be able to speak the language decently well. The second method, though, is not likely to work at all. Unless you believe in learning through osmosis, you’re probably not going to retain much of anything by sleeping through the language lessons. It’s faster, and it’s easier—but it simply doesn’t work!
For investors, it’s all too easy to fall into the trap of believing that just because a short-term investment promises more immediate results that means it must be a good idea. Rather than thinking, “if it seems too good to be true, it probably is,” we are often tempted to think, “if it seems too good to be true, we’d be idiots not to buy into it!” We’re told that we can beat the market because we have experts who know which stocks will offer the highest return on investment. If that were true, we really would be smart to listen to the experts. The problem is that, like the “learn-while-you-sleep” language learning technique, those stock market “experts” simply cannot deliver.
In investing, good old-fashioned patience gets the best results—not immediately, but over time. Investing is all about the long-game; there simply is no other way to build wealth strategically. If you actually do “get rich quick,” it’s not because you followed someone’s advice; it’s because you got lucky. And luck is not a strategy. If you’re wrestling with which moves are actually “smart” moves in your investment strategy and which ones are merely ineffective shortcuts, feel free to reach out to us for a complimentary consultation. We want to help you work smarter AND more diligently to build the portfolio that actually gets you where you want to go.