Scott Pape Says Be a Simpleton

While I’m classified as a ‘sophisticated investor,’ I invest like a simpleton.
— Scott Pape

Scott Pape's approach to investing is disarmingly straightforward, and it works because of that, not despite it.

Pape has said that his investment strategy is so simple, “I could teach it to my six-year-old son.” He has. And that’s the point.

Investing, in his view, doesn’t have to be intimidating. The financial industry thrives on complexity, but Pape would suggest that’s not for our benefit. It’s to make the product harder to compare, and the fees harder to question.

When Pape says he invests “like a simpleton,” he means it as praise. Simplicity, done well, is an act of discipline. It’s a decision to ignore the noise, to avoid the temptation of short-term flash, and to keep doing the obvious smart thing, even when it’s boring.

For most of us, that means setting up automatic investments, choosing low-fee index funds, and not messing with them just because the headlines are loud this week. That may not impress at a dinner party. But as Pape would say, it pays.

And while passionate investors like me are checking our portfolios daily, Pape does so only four times a year.

Scott Pape's book The Barefoot Investor is a great introduction to personal finance and investing for anyone who hasn't quite gotten their money into order.

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