Kaplan on Your Money

Invest Like a Tortoise -- Not Like a Hare

Aesop’s “The Tortoise and the Hare” is a perfect metaphor for the way people go about investing their money. As you recall in the fable, the hare brags about his ability to beat the tortoise and is overly confident about winning. In the investment world, the hare is someone who thinks he or she is great at selecting “winners” and avoiding “losers.” The “hare” is your neighbor, brother-in-law or the person at a cocktail party who makes you feel small and inadequate when it comes to investing.

By comparison, the “tortoise” is a perfect stand-in for the kind of “slow and steady wins the race” approach to investing that has been proven to grow your wealth with greater certainty and less risk. There is no secret to how it’s done, but it requires a steady and relatively unemotional approach to investing, methodical steps and a willingness to be unfazed by market hype. A financial advisor can help or you can follow these steps:

  1. Map out your ideal portfolio (e.g. 60% stocks, 40% bonds/cash) and allocate your investments along these lines. Your portfolio should be consistent with your tolerance for risk and should be the “best fit” to reach your financial goals.
  2. Using this 60/40 portfolio, create “tolerance bands” that trigger rebalancing. For example, you allow stocks to appreciate to 66% of your portfolio (and bonds/cash to 34%) before you trim stocks and buy more bonds. On the downside, you allow stocks to decline to 54% of your portfolio (and bonds rise to 46%, if they are doing relatively well) before buying more shares and trimming bonds. There are no hard and fast rules for tolerance bands – someone else might set the 60% rebalance band at 70% of the portfolio and only rebalance (trim stocks, buy bonds) at that point.
  3. Skip chasing individual shares and pursue broad “asset classes”:  Avoid “stock picking” (the “hare” approach and emphasize a good mix various asset classes, e.g. “large cap value,” “mid cap growth,” “international developed shares,” “municipal bonds” (in after-tax accounts) etc. Each asset class consists of hundreds or thousands of holdings through the beauty and convenience of mutual funds or Exchange Traded Funds. You smooth your risk in this way, and avoid getting dinged by a plunging share price. Yes, you also avoid riding an Amazon or Apple ever higher, but you have a smooth upward ride of shares overall because you’re diversified – and less nail biting along the way.  (Stock pickers will object and say they do better than the market but data prove otherwise).
  4. Outperforming asset classes (currently "US large cap growth") do relatively well for awhile...but eventually they revert to the mean (do relatively less well as investors turn to laggards).  Laggard asset classes (currently "US large cap value") become more attractive and start to perform relatively well as investors take profits on outperformers. 
  5. Avoid market timing. The “hare” market timed by running ahead (and then resting under a tree – or getting temporarily out of the market) while the “tortoise” plods along at a steady pace. Not sure how to time investing a larger lump sum (e.g. 401k rollover to an IRA)? Do it in increments – invest ¼ of your funds every month for 4 months, or 10% of your funds every month, etc. Dollar cost averaging is the perfect way that 401k and 403b investors put money into investments – the same dollar amount each pay period.
  6. Avoid spending time with market braggards and shut out investment white noise. Life is short – spend less time around people who make you feel small (about investing, or anything else) and more time working on your “slow and steady wins the race” approach.


Eve Kaplan is a Fee-Only (no products sold) Certified Financial Planner® Practitioner with 30+ years of investment/planning experience. Kaplan Financial Advisors upholds the highest fiduciary standards in the planning industry.  Eve opened Kaplan Financial Advisors in 2004 to provide comprehensive financial planning and investment management services to single women and couples. Eve can be reached at 908-898-0549 or Eve@KaplanFinancialAdvisors.com.  Visit her website at  www.KaplanFinancialAdvisors.com


Copyright © 2011-2017 by Eve Kaplan

The opinions expressed herein are the writer's alone, and do not reflect the opinions of TAPinto.net or anyone who works for TAPinto.net. TAPinto.net is not responsible for the accuracy of any of the information supplied by the writer.

TAP Into Another Town's News:

You May Also Be Interested In

Sign Up for E-News

Berkeley Heights

Berkeley Heights’ Women of the Week (WoW) Series features Beth Ferris Sale

March 18, 2018

In honor of the women who are driving change, blazing trails and nurturing society, the Berkeley Heights Diversity Council is pleased to announce an exciting initiative called, Women of the Week (WoW) Series. In the spirit of community, we wanted to honor the women right here in Berkeley Heights who are impacting the world in their own way for the remaining weeks of Women’s History ...

91 Young Musicians Work Together To Raise Nearly $14,000 for the New Jersey Youth Symphony

March 20, 2018

NEW PROVIDENCE, NJ —91 young musicians in the New Jersey Youth Symphony’s Youth Orchestra (YO) ensemble have raised nearly $14,000 to date for the organization’s annual Playathon, a student-led fundraiser established by the New Jersey Youth Symphony (NJYS) in 1985. The Playathon is the largest free concert of its kind and this Sunday over 450 students from 12 NJYS ensembles ...

UC Tech Student Volunteers Put Fun and Games to Work for Special Needs Learners

SCOTCH PLAINS, NJ -- Earlier this month, a group of 51 students in grades 9 to 11 from the Teacher Education Academy at UC TECH staged an indoor carnival for special needs learners. More than 140 participants from the community attended the event and enjoyed plinko, corn hole, dance revolution, hula hoop activities, a DJ, prizes and more.

UC TECH is part of the Union County ...

Soprano Anita Lyons Featured Soloist at Summit Symphony Concert March 25

The music of Grieg, Schumann ad Strauss will form the centerpiece of the next Summit Symphony Orchestra concert of the 2017-18 season, a performance which will take place March 25, beginning at 2 p.m., in the Summit High School Auditorium. Admission to all Summit Symphony concerts is free, with donations gratefully accepted. 

American Soprano Anita Lyons will ...

Host the Ultimate Party -- Extreme Foot Dart at the YMCA

Host the coolest, most unusual party EVER where kids will have a blast running and kicking balls around a gym trying to hit a ginormous inflatable target.   A variety of games and activities will be sure to keep your guests engaged and having fun followed by 45 minutes in our private party room.

 Party Times: April - October
Saturdays: 3:30pm-5:00pm

Members / ...

NPHS Student's Response to After School Walk-out Plan at NPHS

March 14, 2018

A group of students file into a science classroom amid a nervous din of chatter, the air is electric with excitement and nervousness. This small group of approximately 30 students are a studious bunch, largely members of the sophomore class with squeaky clean administrative histories. They are currently preparing to defy authority and stand up for what they believe in, even though they had been ...

New Providence's Allen W. Roberts School Gets Security Walk Through by Police Department after Bomb Threat

March 12, 2018

NEW PROVIDENCE, NJ - The New Providence Police Department sent a letter to parents and guardians of students at Allen W. Roberts Elementary School after a non-specific bomb threat was reported on Monday afternoon.

It's the second threat  reported at a New Providence school in March. The first threat was reported on March 5th at New Providence High School.

Emergency ...

Hillsborough: Suspended HS Athletic Director Charged with Theft

March 20, 2018

HILLSBOROUGH, NJ - Suspended Hillsborough High School Athletic Director Michael Fanizzi has been arrested and charged with the theft of $10,704 in athletic event receipts over a four-year period from 2013-2017, according to Somerset County Prosecutor Michael H. Robertson.

Fanizzi, 53, a resident of Conover Way in Hillsborough who had been athletics director for 14 years,, had been suspended ...

Upcoming Events

Wed, March 21, 5:30 PM

Great Swamp Watershed Association, Morristown

Coffee & Tea Tasting - FREE GSWA Event

Arts & Entertainment Education Food & Drink

Wed, March 21, 7:00 PM

Summit Free Public Library, Summit

increase your networking and interviewing iq

Business & Finance Other

Thu, March 22, 7:00 PM

Summit Free Public Library, Summit

The Long march home: An American Soldier's Life ...

Education Other


Fri, March 23, 9:30 AM

Dunkin Donuts, Berkeley Heights

Let’s Meet Up to Clean Up! BH Walks, a New ...


Fri, March 23, 8:00 PM

Burgdorff Center for the Performing Arts, Maplewood

Strollers Present John Patrick Shanley's "Doubt"

Arts & Entertainment

JCP&L Representative Describes Utility’s Actions During Storm Quinn, Answers Residents' Questions

BERKELEY HEIGHTS, NJ – The format of this week’s  Berkeley Heights 'Here and Now' was turned on its head this week. Mayor Bob Woodruff reviewed what happened in the township following Storm Quinn and its predecessor Storm Riley, complete with statistics. He then asked a representative of JCP&L questions about the utility’s response, and how it was ...

Berkeley Heights, Here and Now: Redevelopment Updates

BERKELEY HEIGHTS, NJ - The Mayor's Round Table has been rebranded to "Berkeley Heights, Here and Now." This new format will continue to provide updates from Mayor Bob Woodruff, municipal offices and the Communications Committee want to hear from citizens, businesses and community organizations.

Included in this episode, Mayor Bob Woodruff addresses the status of the ...

Dear Susan: Beauty Tips from a Beauty Expert, Spring Edition

SUSAN BARBAGLIA, owner of Skin Deep Salon and Spa in New Providence, offers a wealth of knowledge and expertise as a leader in the beauty industry. With over thirty years experience in skin care, Susan can answer your most challenging beauty questions. Email your ...

You Want a Check for How Much!

 My first admissions gig was working for a small liberal arts college with a pretty hefty price tag.  Picture me at a college fair: name tag in place, pile of brochures ready to go.  An eager family would walk up and we’d start a conversation.  One of the first questions I’d get from parents was about cost and the moment that $50,000-plus figure left my mouth I ...

Now That The Dust Has Settled…Smart Tax Moves In 2018

Now that the dust has settled, here are some smart tax moves to lower your taxes and/or avoid higher taxes/penalties in 2018. These steps may be especially helpful if you live in high property and high income tax states (e.g. New Jersey, New York, California) since state and local tax deductions are capped.  Unfortunately all these changes mean you’ll need more time and energy to ...