Since it first aired in June 2021, Clarkson’s Farm has become one of Amazon Prime’s most popular series. The hit TV show has enjoyed three successful series and delighted millions of viewers around the world.
With season four coming next year, if you haven’t already seen the show, it may be time to add it to your watch list.
For those of you as yet unfamiliar, the documentary series follows Jeremy Clarkson on his 1,000 acre-farm, near Chipping Norton in the Cotswolds.
With no previous experience, Jeremy, together with his partner, Lisa Hogan, and a team of farming professionals, tend the land and rear a variety of livestock.
In true Clarkson style, Jeremy renamed his farm Diddly Squat, signifying its distinct lack of productivity. And yet, somehow, each season, despite setbacks, and heartbreak, they persist in trying to keep the farm going.
As unlikely as it may seem, the popular show can teach you three fundamental investment lessons. Read on to learn more.
1. Diversify your investments
To succeed in creating a reliable income stream from Diddly Squat, Jeremy is constantly seeking new ways to diversify and make money.
In season one, the farm only made £144. So, in series two, Jeremy sets out to rectify matters – with a herd of cows, a flock of sheep, and a brood of chickens.
Having already opened a farm shop, Jeremy works to expand the range, selling eggs and meat, alongside produce from neighbouring farms.
He also grows potatoes, barley, wheat, rapeseed, and other crops – enjoying varying degrees of success.
While the ventures don’t always succeed, diversifying in this way helps him to balance the risk, potentially reducing losses and increasing gains by the end of the show.
Ensuring you have a well-diversified investment portfolio is a crucial factor for successful investing.
Rather than livestock, arable, and farm shops, a financial planner will ensure your investments are spread across a variety of sectors, geographies, and asset classes to reduce the risk and increase potential for growth.
2. Harness the power of compounding
In an attempt to boost productivity, in series three, Jeremy promotes Kaleb to Farm Manager and sets a competition to see who can derive the most profit.
While Kaleb is tasked with taking care of the farm, Jeremy attempts to “farm the unfarmed”.
Alongside foraging for nettles (to make soup) and blackberries (to make jam), Jeremy also decides to grow mushrooms.
We watch him invest time and effort to create the perfect growing conditions. Once the scene is set and the mushroom bags are in place, Jeremy leaves them to work their magic.
A short time later, he’s delighted when he returns to find more mushrooms than he’d expected. He immediately starts to harvest them – making room for more to grow.
The mushrooms grow so fast, Clarkson can barely keep pace and, as well as selling them in the farm shop, he creates a pop-up stall, and also sells them to local pubs and restaurants.
While it may take longer than growing mushrooms, over time, you can harness the power of compounding through your investments.
Left to work for long enough, compound interest could generate impressive returns. The longer you remain invested, the more interest you could generate.
For instance, Barclays have shown that if you invest £10,000 and it returns 2%, after the first year, you’d have £10,200. The following year, you generate 2% growth on your original £10,000 investment and on the additional £200 that you earned in the first year, so you’d now have £10,404.
Assuming you maintain the same 2% growth, after 20 years, your original £10,000 balance would be worth £14,859.
Another brilliant thing about compounding is that, once your money is invested, you don’t need to do much to benefit.
If you’ve diversified your investments enough and your portfolio is aligned with your financial goals, time in the market can do a lot of the work for you.
3. Enlist expert help
Recognising that he lacks the adequate experience and knowledge to make a success of his farm, Jeremy surrounds himself with experts.
Trusty sidekick Kaleb has been farming the land around Chipping Norton since age 13. Now 26, Kaleb brings more than a decade of experience to help Jeremy on Diddly Squat Farm. He and Jeremy create a great double act, with Kaleb often offering helpful advice – even if it lands of deaf ears.
Agriculture consultant, Charlie Ireland, has 20 years of experience in farm management and strategic planning. An integral part of Jeremy’s farming journey, Charlie helps the Diddly Squat team implement their plans, often stepping in as a wise voice of reason, to help rein in Jeremy’s madcap schemes.
Also in the gang are Lisa Hogan, Jeremy’s partner, Gerald, vet Dilwyn Evans, and a wide cast of guests who provide specialist expertise on areas like beekeeping, rearing goats, making chickens happy (by having a radio playing in their coop), and everything in between.
Just as Jeremy benefits from having experienced professionals at his side, you too could benefit by seeking support from a professional financial planner.
At KBA, our team of highly qualified Financial Planners can help you review your finances, create a long-term plan that aligns with your unique goals, and ensure that you don’t allow your emotions to prevent your investments from reaching their true potential.
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We are here for all your financial planning needs. Whatever your goals, we can build a tailored financial plan and investment strategy to suit you.
Email contactme@kbafinancial.com or call us on 01942 889 883.
Please note
This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.
The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.
Past performance is not a guide to future performance and should not be relied upon.
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