Why make it simple when you can make it complicated?… they say.
There is a brilliant French phrase that I find myself using more and more often: “Pourquoi faire simple quand on peut faire compliqué?”
Translation: Why make it simple when you can make it complicated?
Usually, this is said with a shrug while trying to navigate French bureaucracy or figuring out why you need three different appointments to get the internet installed. But lately, I’ve realised that the entire global financial industry seems to have adopted this as an unofficial motto.
There is a misconception in finance that “sophisticated” means “better.” We are taught to believe that if a strategy involves complex diagrams, obscure terminology, and an 80-page prospectus, it must be doing something clever that we mere mortals can’t understand.
I saw a perfect example of this recently.
I was reviewing a portfolio for a US expat who had come to me for a second opinion. On the surface, the portfolio was a masterpiece of complexity.
It had everything: dozens of funds, structured notes, offshore bonds held inside trusts… it was incredibly intricate. To the untrained eye, it looked impressive. It looked like the kind of plan that justifies a high fee.
But when we stripped it back and looked at the underlying numbers, the reality was very different.
It was like a beautiful sports car with the wrong engine. It wasn’t actually going anywhere.
The fees were so high that they were eating up almost all the growth. The sheer number of holdings meant it was accidentally over-exposed to certain sectors while ignoring others. And, because the client was a US citizen, the tax reporting required for those specific “clever” offshore structures was an absolute nightmare.
My client had paid a premium for complexity, and all it had bought was a headache.
My philosophy is the exact opposite. I like boring investments.
I like clear reporting. I like knowing exactly what I am paying, what I am invested in, and why. I want my clients to be able to look at a single page and understand their net worth, rather than needing a decoder ring to figure out their pension statement.
Successful investing isn’t about finding a magic, complex formula. It is about doing the simple things consistently well over a long period of time. It is about keeping costs low, keeping taxes efficient, and keeping your habits in check.
Sometimes, simplicity is the ultimate sophistication. Simples.
As expats and globally mobile professionals, we have enough chaos in our lives.
We are raising kids in foreign cultures, navigating immigration paperwork, and—in my case—trying to remember that the French like to shut everything down for two hours at lunch (I’m getting used to it, but it still catches me out).
We don’t need chaos in our portfolios, too.
Your financial plan should be the anchor that steadies the ship, not another source of confusion. So, keep it simples (as I always like to say). Keep it compliant. Keep your sanity.
If you look at your current plan and feel like you’re reading a foreign language, it might be time to strip it back. Feel free to reach out if you want a second pair of eyes on it.
