12 Things The Holidays Teach Us About Investing


There’s the “12 Days of Christmas” and there’s also my twisted version, the one I refer to as the “12 Things The Holidays Teaches Us About Investing.” Check it out:


The holidays: While I’m all for the big holiday parties and lavish events, looking back at our most memorable holiday moments, I bet many would agree it’s the simple moments spent with family and friends that are typically the most rewarding.

Investment lesson learned: Learn from the holidays. Simple investments such as the S&P 500 (that typically outperforms most professional money managers) teach us that it doesn’t have to be complicated for it to be effective.


The holidays: Turn on a holiday newscast and there’s a decent chance you’ll see a story about a handful of frenzied shoppers searching all over creation to find that one last Wii. … Who scored them? That’s simple: the persistent ones who refused to give up.

Investment lesson learned: Just like the holiday shoppers who scored this year’s Elmo, it’s those who don’t give up that often find the treasure. Whether it’s a great opportunity or a creative investment with returns that would make even The Donald proud, finding the good stuff takes time, education and, of course, a willingness to never give up.


The holidays: Did you hear about the holiday shoppers going to Target at 4am? Maybe you were one of them. Understanding the value of bargains, many holiday shoppers take their time to start early, compare costs and find the deals. Doing so accomplishes one key thing: give them a better bang for their buck.

Investment lesson learned: Who thought Warren Buffet and my Aunt Harriet would be so much alike? When it comes to finding undervalued stocks, sifting through the market bins of Wall Street for discounts gives you the best chance to maximize upside while trying to reduce investment risk.


The holidays: When it comes to opening holiday gifts, there’s little worse than seeing a kid who regretfully discovers “not all pieces shown are included.”

Investment lesson learned: Learn from Little Billy gone wild. Whether it’s the presents you give or the money you invest, avoiding the surprises is a job well done. Before investing, read the fine print; that stuff is always more important than the window dressing itself.


The holidays: What holiday would be complete without Auld Lang Syne, It’s A Wonderful Life, Times Square and a hangover to boot? There’s a reason those things and more have lasted the test of time: because they do a timeless job of bringing the true meaning of the holidays into our hearts and homes.

Investment lesson learned: Whether it’s Ben Graham’s legendary “Intelligent Investor” or many other timeless principles of prudent investing, the holidays teach us that if it isn’t broken, why try and fix it?


The holidays: High School, New Year’s Eve, 1982. With my mane of hair, A Flock Of Seagulls, Jordache jeans and one beer too many, falling over Crazy Julie and landing in the hospital to get a head of stitches proved that yes, too much of one thing really can hurt you.

Investment lesson learned: The history of investing is ripe with examples of over-indulgence. Whether it was tulips, dot-coms or the current real estate mess, the holidays teach us that while too much of one thing may not give you a head of stitches, it can easily render you broke.


The holidays: While toaster ovens, dishes and socks have their place under the tree, it’s the creative gifts — the thinking out of the box — that is often remembered the most.

Investment lesson learned: Market gone bad? Selling your stock? Remember: every time you sell, there’s someone on the other side to buy. … who’s doing such a thing? Aliens from another planet? … Not quite. Those buying your stocks obviously think differently, take educated chances, get creative and could wind up reaping some great buys.


The holidays: Want to ruin your girlfriend’s gift? Have me wrap it. … To avoid such despair, here’s a better suggestion: take it over to the mall wrapping station. With precision creases, perfect bows and curly color laces, giving your girlfriend a gift with their touch makes a big difference in showing her you really do care.

Investment lesson learned: Want to ruin your investments? Don’t pay attention to fees and taxes. Neglecting those important details will accomplish one key thing: lower your returns. So, the next time you invest, take a moment to think of those nice people over at the mall. Doing so should remind you that whether it’s gift-wrap or your investments, it’s the details that count.


The holidays: Leaving town for the holiday? Whether it was pricing tickets, figuring out a route or making hotel reservations, what trip would be a success without taking the time to plan it?

Investment lesson learned: Looking forward to retirement? In markets like these, I certainly am. And just like planning a trip, not having a financial destination often leads to nothing but regret. After all, this is your life we’re talking about, remember?


The holidays: While a front row ticket to Springsteen, a Pug or a Costco-sized case of Famous Amos are all gifts I couldn’t turn down, the holidays teach us it’s the gifts we give – not the ones we receive — that bring us the most reward.

Investment lesson learned: While charitable donations and tax deductions might be all well and good, it’s a daily act of random kindness that personally turns me on the most. Want to make someone’s holiday? Try my personal favorite: pick a random table at a restaurant and pay for their meal. …Want to really blow them away? … Don’t let them know it was you who did it.


The holidays: The experts on resolutions, whoever and wherever these people may be, tell us the more resolutions you make, the less likely you are to keep them. To make them work, keep them short, simple and attainable. Otherwise, they’ll rarely be kept.

Investment lesson learned: Listen to those nutty resolution experts. Pick one or two investment ideas for the New Year, and if you can’t think of one, try this: save $100 dollars per month and invest it into a low cost, tax efficient and highly productive stock index. At a 7% hypothetical annual rate of return, in 10 years you’ll have roughly $17,000. … How good is that?


The holidays: I don’t know about you, but eleven months, three weeks, six days and a few hours into this year, I need to finally get some rest. With that, the holidays are a perfect time to take a moment to kick back, watch the Jets lose another one, eat lots of unhealthy stuff or do whatever it takes to make you happy.

Investment lesson learned: Recession? Higher oil prices? Inflation? More sub-prime mess? For one fleeting, quick and luxurious moment, take a profound breath to say, “who cares?” … After all, there’s nothing wrong with taking a moment to live this wonderful thing some call “life.”

I want to wish you and your family a very happy and successful New Year.
See you next year…



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