The Best Investing Advice: Set it and Forget it


The stock market is a complex institution to predict. Before they fully take shape, people who can see the patterns can often turn small investments into a large nest egg. The field of investing can be a mysterious and incomprehensible place. However, one thing remains true. Across long-view studies of market performance, investors who leave their earliest investments alone tend to make out just fine.

This policy, called “set it and forget it” by some, is a simple one. It holds that you should invest in the stocks you feel good about, preferably a diverse portfolio, and then just let your investment sit and accrue value for you. Why is this a good idea? Let’s take a closer look.

The Market Grows

In a general sense, the stock market tends to grow. Inflation is one factor, but general trends also point to companies doing better year over year. Outside of smaller companies that go under and some big shake-ups, like new technology making older companies obsolete, the market tends to default to slow but steady growth.

This means that a strategy involving a diverse portfolio, a steady hand, and an unwillingness to mess with your investments can all be a great way to see slow but continued growth in your investments. But there’s more to it than just a market tendency.

No Brain, no Headache

Some people overthink their investments and have a terrible habit of allowing themselves to get spooked when the markets move. They see their investments take a slight dip, panic, and then sell out of their position. This is a great way to miss potential growth in the future!

The more patient you can be, the more you can observe the long-term movements of various stocks. Maybe your investment dips a bit one quarter before slowly climbing back the next. It’s tough to predict any market movements completely, but you might get a good idea of the kinds of patterns that tend to repeat given investor sentiment.

Or, you could just let your investment sit and embrace the adage “no brain, no headache.” Why worry about it when you could instead wait for your investment to go back up in value? If you wait long enough, the odds are good that it’ll even out. Taking a “less is more” approach to the stock market might sound counterintuitive, but the fact of the matter is that it’s a proven, successful tactic for the average investor.