Munger Investment Checklist Part 7: Patience

Warren Buffett’s lifelong partner, Charlie Munger, left a legacy that went far beyond investing. Known for his razor-sharp intellect and plainspoken wisdom, Munger had a way of taking complex ideas and translating them into practicable, actionable business lessons. His central lesson was timeless: success is built less on brilliance than on consistent, rational habits that help one steer clear of errors.

One of his most popular contributions is a “checklist” of mental models — principles that help people navigate the ups and downs of investing and make wiser, long-term choices. This week, we’re looking at the seventh principle on his checklist: patience, and why it pays off in the long run.

Munger on patience

Munger in his book, Poor Charlie’s Almanac, said: “Resist the natural urge to act.” This principle captures one of the hardest lessons in investing: waiting it out. Human nature craves activity. We want to do something, especially when markets move or headlines scream. Yet Munger believed that the greatest advantage often lies in doing nothing until a truly great opportunity presents itself. Successful investing is not about constant “doing,” but about intelligent waiting.

• Compound interest is the eighth wonder of the world (Einstein). Never interrupt it unnecessarily: Munger often emphasised that compounding works best when it’s left alone. Whether it’s money or knowledge, the power of compounding occurs when the process is left uninterrupted. Investors who constantly chase short-term gains, buy and sell quickly, or switch strategies at every market turn effectively “reset the clock,” losing the exponential benefits that time can offer. By staying invested in quality companies and allowing compounding to do its invisible work, wealth builds organically.
• Avoid unnecessary transactional taxes and fictional costs; never take action for its own sake: Every investment made comes with costs — not just in brokerage fees or taxes, but in the mental wear and tear of decision fatigue. Munger and Buffett both built their fortunes by minimising these costs. Their philosophy was to make fewer, better investment decisions that didn’t need constant revisiting or fixing. Munger believed in learning about a business fully and investing in companies he fully understood and could hold on to for years. The fewer unnecessary moves you make, the more your results compound.
• Be alert for the arrival of luck. Enjoy the process along with the proceeds, because the process is where you live: While patience means waiting, it doesn’t mean idling. Munger’s idea of patience is active waiting — constantly learning, preparing, and looking for moments when a great opportunity comes around. The best investors use quiet periods to study industries, build conviction, and sharpen their judgment so that when the right opportunity arrives, they can act swiftly and decisively.

Why it’s important

Markets constantly tempt us to react — to chase fads, to panic-sell, to believe that speed equals skill. Munger taught the opposite: that enduring wealth is a product of time, temperament, and trust in the compounding process. Patience means the discipline to hold on, resist mediocre ideas, and strike only when the odds are overwhelmingly in your favour. It is a strategic form of restraint that offers rewards in the long-term.