Yogi Berra Quotes Investors Can Live By
Baseball legend Yogi Berra was wise, in his own muddled way, about more than just sports. His words hold truth in life – and in investing. Here are three lessons any investor can glean from famous Yogi Berra quotes.
- (opens in new tab)
- (opens in new tab)
- (opens in new tab)
- Newsletter sign up Newsletter
Yankee great and Hall of Fame catcher Yogi Berra may be the most quotable athlete ever. The malapropisms attributed to him are legendary and, when viewed through a particular lens, are more useful than at first glance. While not likely to threaten Warren Buffett’s ‘oracle’ status, if Yogi hadn’t chosen baseball, he might have become a Hall of Fame financial planner.
Here are three financial planning tips based on wise words from Mr. Berra.
'If you don’t know where you’re going, you might end up someplace else.'
In financial terms: Start with a plan.
Subscribe to Kiplinger’s Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
A comprehensive written financial plan is one of the most underappreciated tools for investor success. Unfortunately, many people ignore this critical effort, in part because it can be very time consuming, detail-oriented and tedious. However, it’s also the blueprint for a person’s entire financial “house” and, done well, provides the firm foundation on which all else rests.
An investor’s personal headlines are at the heart of a financial plan, which is an invaluable tool for helping investors through unsettled times. The plan focuses on the unique goals and considerations that the investor said were most important to them. Portfolios or strategies should change over time, but those alterations should be in response to changes in an investor’s headlines — the birth of a child or pending retirement, for example — rather than the headlines in the news.
Having a well-thought-out financial plan is often the behavioral anchor that investors need to contend with the uncertainty and doubt that investing entails.
'Ninety percent of the game is half mental.'
In financial terms: Realize that investing is often emotional.
In theory, investors make rational decisions, but that theory often fails in practice. Emotions can play a significant role in investment decision-making.
The process of investing is a mental game, often punctuated by unexpected events — some good, others bad — when our very human fight-or-flight reflex seems overwhelming. This is when the temptation to do something different can be strongest.
What can an investor do to improve their odds for investment success?
- First, mentally prepare for losses as well as gains. Investing is an activity that requires the bearing of risk for the hope of a return on the investment. However, there are no guarantees that ensure success. While asset allocation and diversification are the two most effective risk-management tools at our disposal, they do not immunize the portfolio from all volatility or losses.
- Second, prepare for doubt. Something — at some point — in the future is going to make an investor question their investment strategy. Having a financial plan in-hand when this doubt arises frequently pays huge dividends. Often, it is easier to stay the course when things don’t work out as planned, than when things didn’t work out because you failed to plan.
- Lastly, embrace inactivity. Too often, staying the course is interpreted as “doing nothing.” This is a shame because it actually means something powerful: Have a plan and stick with it unless your situation — your personal headlines — changes. During emotionally charged markets, snap decisions often do not play out as well as intended, destroying wealth rather than creating or preserving it. Ignoring the media and market noise isn’t being ignorant, it’s being enlightened.
'When you come to a fork in the road, take it.'
In financial terms: Perseverance is the key to progress.
As mentioned above, investing is an emotionally challenging journey that forces us to contend with obstacles — both real and imagined — along the way. For some investors, these obstacles cause them to stay put, halting their progress. For others, these “forks in the road” require them to choose a path and continue forward, despite the certain knowledge that the path forward is filled with further uncertainty.
Take the current environment, for instance. With the U.S. stock market at or near all-time highs and bond yields very low, it seems like few investors are completely comfortable with the path ahead. Whether in bull or bear markets, for some investors it never seems to be the “right” time to invest. While most investors invest knowing that higher expected returns come from higher expected risk investments, too often they fail to complete the thought: While this risk-return relationship is reasonable, it is over the longer-term — not the short-term — where it is most (yet, not perfectly) reliable.
Preparation is the key to overcoming these obstacles. If you know that you’ve prepared a thoughtful financial plan that focused on your long-term objectives, and incorporated asset allocation and diversification to help temper risk, you should find it easier to persevere through whatever the market may throw at you in the short-term.
All information presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. This information is distributed for education purposes, and it is not to be construed as an offer, solicitation, recommendation or endorsement of any particular security, product or service, nor should it be construed as tax or legal advice. Please click here to see our blog disclosure, which immediately follows the “Applicable Law and Venue” section. (opens in new tab)
This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.
Don Bennyhoff, CFA®, serves as the Chairman of the Investment Committee and Director of Investor Education at Liberty Wealth Advisors (opens in new tab), a $1.7B RIA. An industry expert who spent over 22 years at The Vanguard Group, Don was a Founding Member of Vanguard’s Investment Strategy Group, and served as a Senior Investment Strategist.
Stock Market Today: Tech, Bank Stocks Lead Markets Higher
Retailers were big gainers, too, thanks to strong earnings from Lululemon Athletica.
By Karee Venema • Published
IRS: Don't Trust All Social Media Tax Tips
The IRS warns that not all social media tax advice should be trusted.
By Kelley R. Taylor • Published
How to Protect Your Cash and Investments in a Banking Crisis
A focus on FDIC insurance and Treasury-only money market or bond fund options can help safeguard investments when a banking crisis threatens.
By Peter Newman, CFA • Published
Maximize Charitable Giving Tax Savings and Give All Year
Thinking of December as ‘contribution season,’ paired with using tax-savvy giving tools, can help you spread the generosity all year long.
By Mark Froehlich, CPA, MBA • Published
Protect Your Retirement: Seven Things You Can Do Right Now
Whether you’re preparing to retire or already retired, a proactive plan is critical to help safeguard your retirement, especially amid uncertainty.
By Jessica Cervinka, IAR • Published
Buffer ETFs Can Limit Investing Losses in Uncertain Times
Doing your own risk-reward investing analysis might be easier said than done, especially when markets are volatile. That’s where buffer ETFs can come in handy.
By Kirk Tushaus • Published
Three Ways Technology Will Fix What's Broken in Philanthropy
Charities stand to benefit from evolving fintech and artificial intelligence that will make charitable giving more efficient, transparent, relevant, collaborative and impact-focused.
By Stephen Kump • Published
Four Steps for Teens Who Want to Test the Investing Waters
Teens who feel ready to try their hand at investing should first get educated, with adult supervision, and then it’s all about diversify, diversify, diversify.
By Kerim Derhalli • Published
Is Retirement in 2023 Still Possible?
Yes, it is, if you have a customized plan specific to your retirement. If you do, you’re in the minority, though, so here are some ways to develop that plan.
By Nicholas J. Toman, CFP® • Published
Being Rich vs. Being Wealthy: What’s the Difference?
It’s all about where you put the zeros — having a large bank account isn’t the same as having zero regrets and focusing on what brings you joy.
By Andrew Rosen, CFP®, CEP • Published