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Investment Barbell Strategy - How to achieve a lifetime of wealth

Updated: Aug 20, 2023


We often hear that investment diversification is super important to long-term wealth accumulation. We also intuitively understand risk and return go together. In general, you cannot achieve the level of return you want without taking a commensurate risk. To get a high return - you need to take high risk. If you are only comfortable with less risk - you will achieve less return. Risk and time are like two sides of the same coin. Understanding risk in the context of time is essential. The future is the playing field.

About the author: Jeff Hulett is a career banker, data scientist, and choice architect. Jeff has held banking and consulting leadership roles at Wells Fargo, Citibank, KPMG, and IBM. Today, Jeff is an executive with the Definitive Companies. He teaches personal finance at James Madison University and provides personal finance seminars. Check out his new book -- Making Choices, Making Money: Your Guide to Making Confident Financial Decisions -- at jeffhulett.com.


But how are risk and return defined and how do we achieve our goals!? We all want to make more money... but how do we do so given the risk we are comfortable with? How do we expand the risk we are comfortable with? How is time synonymous with risk? The barbell strategy provides an actionable framework to think about this and the tools to do it. Think of the barbell approach as a way to manage our emotions and to take the risk we are comfortable with -- but in a way that best achieves our return objectives.


Using the barbell approach helps you build successful investment habits. These habits are summarized with the handy acronym called "the M-T-P":


The M-T-P


  1. Motivation grounding: Be content with yourself, don’t spend money you don’t have, don’t buy things you don’t need, and don’t focus on impressing people.

  2. Time frame setting: Have a long-term focus (and long-term is not two or three years). Wealth and security are built over decades, not months.

  3. Process implementing: Save → Invest → Evaluate → Rebalance → Repeat.


First, you may wonder, “How does a barbell relate to investing?!” In the companion article, we provide a helpful framework, examples, and the tools to implement our barbell strategy approach. Our goal is all about DOING! The investment barbell strategy provides an action-oriented framework for individual investors to:

  • Appropriately manage BOTH diversification AND volatility-born risks.

  • Make time your friend for managing risk.

  • Define quadrants of investments aligned with typical life goals, like homeownership.

  • Provide quadrant weighting suggestions to optimize the risk-return tradeoff.

  • Furnish resources and feedback from world-renowned economists and investors to help enhance your personal finance confidence.

  • Give examples and decision tools to practically implement the investment barbell strategy.

  • Encourage a "process not perfection" mindset. We provide a "health check" tool to assist in identifying and making mid-course corrections.

  • Assess the various investments we typically engage in throughout our life.

  • Provide a repeatable, consistent investment decision process useful for all our investments.

Did this introduction whet your investment whistle? If so, please check out the barbell strategy in this companion article:


You've Got This!

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