Commonsense Advice: Medical & Financial

Fortune

A prominent investment advisor featured in magazine once told of an experiencehe had with 2 physicians. The advisor askedthe doctors what he could do to live a longer andhealthier life. Very quickly they both agreed—drinkmoderately, exercise, wear seatbelts when driving,take an aspirin every other day, and don't smoke.

At first the advisor, founder of his own financialconsulting firm and author of 9 personal financebooks, was stunned by the simplicity of the doctors'recommendations. But the more he thought about it,the more he realized that the doctors were advocatingdiscipline and balance—keys to both medical andfinancial prosperity.

These insights, while far from revolutionary, highlightthe fact that a middle-of-the-road approach is thekey to achieving personal fulfillment. The advisoradmitted, as do many of his reputable colleagues, thatfor years he has advocated an average, middle-of-the-roadapproach as 1 of the keys to investment success.For example, a $500 monthly investment with a 9%average annual return over 25 years will yield morethan $560,000.

In closing, the advisor says, a good way to achieveabove-average returns is to accept average performances.If you invest your money with balance (holdingdiversified investments) and discipline (reviewingyour financial goals), you'll miss peaks and valleys andstay fully invested during an inexorable march up theinvestment hill.