Long-Term Investing: Time as Your Ally, Not a Path to Quick Riches
Paris – A strategy of consistent, long-term investment-allowing returns to compound year after year-is a powerful wealth-building tool, but it’s a far cry from ”getting rich while sleeping,” as critics once suggested regarding former French President François Mitterrand‘s economic policies, writes Marc Fiorentino in a recent column for La Tribune. The key, he argues, is to let time work for your savings, committing to a placement horizon that is “as long as possible.”
Fiorentino distinguishes between short-term savings, best suited for liquid investments like tax-free savings accounts, and the bulk of one’s savings, which should be invested with a long-term perspective tailored to individual needs, age, and risk profile. He cites Warren Buffett‘s famous 1988 statement: ”Our favorite holding period is eternity…” acknowledging it as hyperbole, but emphasizing the core principle.
The author stresses the importance of avoiding self-inflicted “shocks” to investment portfolios-emotional reactions to market fluctuations that lead to buying and selling at inopportune times. He advises leaving short-term market timing to professionals and advocates for scheduled, regular savings contributions to smooth investment efforts without unduly impacting purchasing power.
With increasing life expectancy, Fiorentino notes that even investments locked in for five or eight years are becoming relatively short-term. He concludes by echoing both Warren Buffett and singer Alain Chamfort, highlighting the power of time in fostering serious financial growth: “And it is time that runs, runs, that makes us serious.”
