The Immortal Investor: How to Fearlessly Build Lifelong Weath

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The Immortal Investor How To Fearlessly Build Lifelong Wealth

By Martin Goldberg Copyright 2021

Dedication To my father, the original Immortal Investor.

Introduction Not every book has an obvious purpose. Some are built around mystery, choosing an elusive path to the shadowy end. Others remain uncertain of their own identity, mumbling between different writing styles and perspectives, searching for the excellent number. Still more claim to provide avenues that can “self-help” struggling homo-sapiens over the smoldering obstacles of time. This text is both the sum of those things and a new deviation entirely. It emerged as the result of considerable debates I studied (and had with myself) which seek to provide clarity on the topics of investment strategy and the market’s cycle. Economists have attempted for years to mathematicise investment patterns, scrounging after steady rules and fixed predictions as to what might happen next – only to be as dumbfounded as the next person once an outcome is clear. The regulations people spout like biblical truth are immediately discarded when a market downturn materializes, at which point they change into a herd of panicking gazelle under the lionesses’ stare. Sell orders are put in, smashing that nest egg into a flurry of red digits. Once the dust settles and markets stabilize, perhaps they find a moment to interrogate the wounded self: “Why?” The answer is fear. Thoughts of failure and poverty, terror over missing out on what the crowd is doing, obsession with meeting the standards that others set; all said elements combine to throttle life where it would venture to stand. Our ready self-image, embodying the person who stands tall and unabashed against worldly influences, comes crashing down with flagrant speed. All because we are afraid. In the past, I have lost money due to similar worry or over-analysis of the financial markets. Such results were birthed from a mind generally devoted to rational thinking at the expense of emotion. I tend towards avoiding harsh shifts or quick replies, opting to instead embrace calm contemplation before acting. Yet in those instances I faltered, only realizing the mistake with the advantage of post-trade clarity. My own disappointments thus became an impetus for change, save one that could not be limited to the individual realm. I felt a need to broadcast the message and so improve the chances of others. This task may seem

oversized for one man, yet merely pushing a few people in the right direction could work wonders for the market’s future security, and that of investment accounts. If the collective lift saves but a couple retirement funds, then I would be amiss to not properly address its nature. After all, the legacy we leave behind has a capacity to ripple far beyond the grave, both in terms of financial prosperity and human well-being. This latter concept, emanating strength even once we pass on, holds special currency for the life of what is called The Immortal Investor. When we deploy funds based on normal patterns of greed and “Get rich quick” schemes, the answers are reliably thrust to pure chance, and stereotypes viewing the market as some large casino seem validated. The perpetrators of similar strategies are also excellent preachers against the entire idea of investing; they might gain 50 percent, but their obsession with becoming a millionaire in a fast second causes them to take bad leads, and find worse portfolio results. The next move is for them to condemn the very prospect of investing as “too risky.” Consequently, the investing community needs a message that can ground it firm on the earth in the days and years ahead. The objective of The Immortal Investor in this way is to calm the psychological pandemonium of Wall Street ticker clocks and remind people of the ties that ultimately bind, those rules which regularly play out through the tremendous din. Although accepting these realities is difficult, and remains so during the course of an investing career, they provide a far better track record than the all too human approach of panic and selfterrorization. I have consciously designed this book to be brief, as I recognize that finance is not always the most endearing topic to gorge one’s self on. Nevertheless, the information is arranged in a manner to cover many of the critical debates held by investing circles about strategies in the long and short term, distilling out noise in favor of fact, with historical data to support. Thus readers can filter the crucial information without feeling compelled to become soldier-economists themselves.

I. Foundations of Retirement What most of us see as retirement is a relatively new idea,[1] but one which gained great popularity in the thrall of the Baby Boomer generation. Prior to the creation of welfare programs like Social Security, people worked until they could no longer do so and then “retired” to live with close relatives. Gated communities and assisted living facilities were exceptionally rare, their rooms reserved largely for the high and mighty on economic scales. With Boomers came the idea of those “Happy Golden Years,” colored by pension payments and retirement communities catering to the average and exhausted. “Don’t live with your children and help raise the grandkids,” the new mentality swore, “Have your beach house in Florida and drink vodka from a coconut!” It’s lovely in all the imagery, though of course modernity makes retiring a complicated and sometimes unrealistic goal. By this I don’t mean you cannot retire, but rather that the expectations vs. reality dynamic might be lacking. Those seeking to own multiple homes for personal use and live high on the hog in their sixties will require far more money than someone who opts for the simple life. On the extreme end of the spectrum are folks who manage to scrape out a living with $5-7k, allowing them the freedom to retire decades before the societallyacceptable date.[2] Of course it is debatable how good the quality of life is on this amount of money, yet even that idea is highly subjective. Some among you may find the proposal perfectly acceptable, which could involve living in a car, while others decry the mere suggestion. For myself, I attempted a cheaper mobile lifestyle and found the experience far better than most would imagine, so the question will ultimately be an individual one. Other folks demand more in terms of lifestyle, so the retirement coffers must be larger. Our goal in this section is to draw out a realistic guide that must be addressed by everyone looking towards their retirement years. Housing All people need shelter. Sure, it’s entirely possible to live out in the woods as a hermit, or perhaps get by using the #cardboardlife approach, but even there an element of housing is involved. Perhaps because of this intractable nature, accounting for where you live is critical to

understanding the Immortal Investor concept. Depending on the cost of rent/mortgage, or the reliability of the RV one drives, the issue does not go away simply because it seems like second nature. Planning on this front has to be done meticulously, as it will absorb a ridiculous amount of funds if disregarded. Buying a house remains one of the iconic American symbols of success, and indeed, it can be, if only the conditions stay ripe. Owning a property allows the deed holder to invest in a building that can be repurposed to run a small business or rent out rooms. The latter should be very much considered by anyone purchasing a house on mortgage, as the cost does ramp up when interest is considered. Shooting for a model where enough space is open to absorb 50-100 percent of the mortgage through monthly payments is advisable. Make sure those charges account for utilities such as electric, water, and internet. The nightmare emerges when tenants suck up charges with long-ass showers or heating consumption while grinning over the flat monthly rate they pay. On the subject of mortgages, begin by speaking to different banks about their loan offerings. To place it in perspective, my primary bank offered a tag-line deal including no PMI (Private Mortgage Insurance) without putting down 20 percent. I initially went ahead, but by the time they rate locked it was looking like 4.5 percent interest, with the excuse that I wasn’t slapping that full 20 percent on the counter. Pretty cynical on their part. With bank No. 2 I had to pay PMI, but got a rate of 3.5 percent, which was brought down to 3.25 percent at closing. Why was this better? Well, PMI is a small charge which only applies until the buyer hits 20 percent of the mortgage paid. The difference between 4.5 and 3.5 percent came to over $100 bucks per month, a ball and chain over 30 years unless refinancing happens. As a quick note, “buying down” the rate means paying for a lower percentage. Whether the 0.25 percent deduction was worthwhile is debatable, mainly because interest rates came down further afterwards. In any case, that can be fixed with the refinance scheme, in which the person paying a mortgage gets another bank or loan issuer to take over management of the debt for a fee – and thus pays less interest over time. So if Martin Goldberg refinances from 3.5 to 2.5 percent, he saves significant money over the course of the loan in interest. Sometimes refinancing means getting less years to pay it back, however, so the 30-

year goes to a 15-year, for example. Thus the monthly mortgage charge may or may not rise, but overall the homeowner saves money. In order to (roughly) calculate how much you will pay on a mortgage, follow the succeeding guide: 1. Take the sales price (say 250k), and subtract the down payment, for the sake of argument let’s assume 5 percent, or 12.5k. This leaves about 238k remaining. 2. Divide this number by the term of the loan, which for our purposes shall be 30 years. That gives a result of $7933.00, which we can spread across 12 months, getting $661.00. 3. At this stage, multiply the balance of 238k by the interest rate of 3.5 percent, or, in decimal terms, 0.035. We get an outcome of $8330.00, and put this over 12 months, for $694.00. This means your monthly payment will be roughly $1355.00. 4. But it’s not over yet. The $694.00 will slowly decrease as the loan is paid off, because the total balance will be less when multiplied against the steady interest rate. 5. Now we have to factor in PMI, which as we know is paid until 20 percent of the loan is gone. The amount will vary based upon mortgage size, but in this case $50.00 is a reasonable estimate. So we’re at $1405.00 monthly. Of course PMI drops off after a few years, so that will disappear soon enough. 6. One last thing on the mortgage front: property tax. In most cases, this charge is collected in the escrow account where your mortgage balance is held, allowing for an easy monthly payment of everything together. Property tax is based on assessed value of the house (determined by revenue-hungry county inspectors), and the rate applied in your locality. This is one great mockery of home ownership in the United States; while a person can pay off their mortgage entirely, property tax never goes away. Some people even pay upwards of 5-6k annually in taxes, while those in cheaper areas may get by on as little as $900.00. 7. Let us quickly mention homeowner’s insurance, a necessary benefit that can run the homeowner $70.00 per month or more. Make sure to calculate this as well when performing the budget breakdown. With these aside, a better picture of monthly costs for a house materializes. The ideal target for income percentages is 20-30 percent of

what you earn. Some will go as high as 50 percent, but this enters dangerous financial territory, assuming there are no tenants available to help absorb the cost. Things become far worse if the homeowner loses their job, as the hit to savings will be significant. Utilities must also be taken into account. Again, like property tax they depend on the municipality and existing regulations. In general however, target around 40-60 bucks monthly for internet, another 50-60 for electricity, and 30-40 for water/sewage. These will fluctuate widely based upon how much residents use, but the figures provide a decent baseline to calculate before signing any contract. On the latter note, you as the buyer have a right to walk away until signing the final documents. If the inspection comes up bad or for any other reason, go ahead and back out. No one can force a sale simply because they feel like it. Money matters, and time matters. Choose carefully. In regards to the long-term viability of owning a house, understand that upkeep is crucial. Buildings are like any other physical possession: as time passes, they decay and require much servicing. Sadly, a culture of neglect has possessed modernity, with everything from the smallest piece of clothing to entire residential homes being treated like mere utilities, with no valid purpose beyond their base existence. One can drive through American neighborhoods and see the damage in quick formation. Great houses, once splendid on display to the human eye, sit in utterly forlorn shape, with faded paint, compromised roofs, fragile windows, and abandoned landscapes creeping through vengeful vines up the exterior siding. What’s more, it is not always a question of deficient funds driving this decrepit scene; basic repairs cost little, even if performed by a professional. Instead, people let their property go because they lack motivation to do otherwise, as “It’s too much trouble.” Hence these homes, constructed with love and ambition at heart, mourn in silence their forgotten purpose. Any soul buying a house should be prepared to Resist. Resist not just the physical decline, but those vile thoughts accompanying it. Plan to complete regular maintenance on the property, such as painting, caulking, and cleaning. If these actions seem too undesirable, get ready to pay someone else for the pleasure, even if it is a gig-delivering person from the internet. You’d be surprised how such little steps can extend the lifespan of a building far beyond the expected remodel (or demolition)

date. Trimming shrubs and trees away from the home’s siding is also important, as the reduction of moisture brings with it added protection. In the event a bigger project is afoot, such as roof work, set aside money which can be used eventually towards the goal. Financing loans are another way to spread costs out for critical needs. Roofing and windows are important because they prevent damage from water, probably the biggest threat to a house’s long-term viability where structures are concerned. Consider renting out rooms as well. Not only does this permit the paying off of a mortgage at minimal personal expense; it can also provide income in retirement years when regular salary payments are bound to be far less. That being said, do not allow tenants to take advantage of the premises. Any leasing contract should clearly spell out terms and expectations, with special focus on behavior that will NOT be tolerated. When deciding on a rent charge amount, draw up all the monthly bills to determine what the tenant share will be. It’s easy to create one flat rate to cover everything, yet a problem could arise if the renter takes 30 minute showers daily while paying such an amount. The homeowner will bleed extra cash each month on the water bill, even though the tenant is technically observing lease obligations. Adopting an agreement with contingencies for average costs of water and other utilities can help reduce the risk. Renting The immediate neighbor to home ownership is renting, and it too factors in the debate on retirement living. Obvious benefits to paying monthly for a place to stay without actually owning the property abound. Getting up and leaving is far easier, because there is no mortgage or home improvement costs anchoring things down. On the latter front, being able to outsource all fixes to someone else is pleasurable, as it eliminates another potential expense that must be factored in. Beware however that a landlord can put out an assessment fee so as to absorb costs of a larger repair, such as the roof in a condo community. Two hurdles exist with renting, especially from the Immortal Investor position. For one, an apartment or rented building is harder to monetize. Renters can run a business out of the structure (assuming they have landlord permission), but renting rooms is tricky. Some locations may not mind about subletting, although usually they want the money paid to them, not you. It is possible to sublet in a stealthy manner, but this

depends on the vigilance of the property owner, such as how frequently they swing by to check on things. In the event they prohibit sub-renting and the tenant does it anyway, fines and evictions may arise. The other matter is rent increases. Recent data indicates a boost of 64 percent over the last 20 years,[3] and things may well worsen as time goes on. Retirees can look at cheap rural areas for lower rates, though it is worth noting that less-developed regions may have subpar medical facilities, which could be a concern for those on the older side of the spectrum. More developed zones solve this risk factor, but they stand to provide a situation where the monthly charges can skyrocket if that part of the country undergoes an economic boom. A further angle dealing with this question is the concept of becoming an expatriate; folks often argue for retirement colonies in South America or parts of Asia due to the lower cost of living. There is nothing inherently wrong with that, although to be clear local conditions matter. Strength of the currency versus the dollar, internal security policies, and the potential for political instability must all be appreciated. Westerners are also assumed to have money, and thus can become the targets of petty crime or kidnappings. In any case, being informed about the new country’s culture and conditions is necessary before establishing a permanent settlement. I advise checking out the YouTube channel The Nomad Capitalist for more guidance on the prospect. Tiny Homes/Mobile Living Ever since the decline of 2008, lots of internet marketers have been pushing downsized existence as a means of doing less with more. Minimalism, so often the catchphrase, implores people to turn their mortgage notes into savings by opting to live in a miniature home, RV, or regular vehicle. The immediate appeal is quite romantic, because money can be saved and retirement at younger ages feels feasible. At the same time, various questions present themselves for the answering. To start, tiny homes offer the prospect of living in a stand-alone structure for fractions of the cost that a real house or apartment would demand. They require less energy to light and heat, are more affordable to purchase or build, and do not necessitate as much time or money for the purposes of upkeep. Certain models even come on wheels as a trailer, making them portable along the same lines we might see towed campers operating.

Unfortunately, the latter point becomes a tricky dynamic. In the preponderance of America, any house without a permanent foundation is prohibited as a long-term dwelling. This means that even tiny homes need to have the classic cement foundation poured and be seated the on top, or else risk legal consequences for the homeowner. A way around the obstacle would be to buy (or rent) property which is secluded by trees, but obviously that means spending a large amount of money in addition to the house, which can run between $30,000-$60,000,[4] depending on the model and amenities. Speculative retirees who opt for the simpler versions will need to contend with a lack of running water and functioning toilets. In fact, tiny home builders frequently advertise offerings with “composting toilets” as an alternative. Investors choosing such a home should ensure the property owner is ok with the setup in the case of renting, and practice nature respect by distancing the toilet from any natural bodies of water to avoid contamination.[5] Now, in the event that a foundation is built for the house, understand the limitations on resale value. Small buildings may be harder to expand without specialist construction services, and the market appeal of a compact structure is likely less, particularly if the purchaser plans to have kids. Weigh the future wisely before electing for a permanent tiny model. On The Road An easier way to downsize entails living in a vehicle when retirement years hit, or simply to save money towards that goal. Advantages appear to abound, with mobility, less overhead, and general freedom chalking up the landscape. Couples sometimes buy full-sized RVs and use them to tour the country, combining all three values together in those later times. Younger folks adopt the van life concept to evade pricy rents, or simply chase retirement freedom. For a detailed look at my experience with vehicle living, check out the book, Six Months In a Van: My Life On The American Road. Be careful about jumping in too giddily, however. Ease off the gas a bit and consider personal circumstances. Living in a vehicle will present different problems based on the model and location. RVs for one are renowned to be gas guzzlers, creating a substantial cost that is largely unavoidable. Repairs to these behemoths are similarly problematic because they could demand specific mechanical training, a larger-thanusual garage space, and perhaps even someone with knowledge of RV HVAC systems.[6]

Supposing a regular vehicle is being employed, the questions of wear and tear, adequate living space, and the ever-present scourge of weather will arise. A van lifer in California for instance may not need to deal with the excessively humid conditions that could swamp a Floridian. The NYC vehicle resident stands to have a different problem with cold and snow, largely precluding smaller cars that will simply spin wheels in the winter. While some models like the Toyota Prius can run AC off the battery for the Florida chap, the New Yorker who tries to keep his car’s heating system on all night could crush his vehicle’s battery—or generate toxic CO fumes. A couple of items are must-haves for those looking into the comfort side of things: - An adequate sleeping bag that is rated low enough, depending on the location. - Enough layers of padding between the person and car floor, or a raised platform, all to avoid freezing. - Hot water bottles to heat up the bottom of the bag. Fresh clothes to sleep in. Hand or feet warmers. Optional: a remote-start button to power up the car’s heat on colder mornings before exiting a sleeping bag. Some type of battery-powered CO monitor. - Rechargeable fans to keep cool during the summer. Finally, be advised about relying too heavily on external infrastructure like gyms or libraries for personal needs. During the COVID-19 scare, many such facilities were shuttered for months, creating a dilemma for those vehicle residents who used them in order to take showers or use WiFi. Contingency options are necessary, so one might look into getting an unlimited data plan for the phone or a mobile hotspot, and maybe a solar-powered camping shower. Body wipes and dry shampoo can be another temporary (but not long-term) solution when trying to keep clean. Healthy Retirement The central theme of the Immortal Investor concept is that one should be able to invest without being terrified of the future. Although not everything can be controlled for, there are certainly ways to maximize chances of success down the road, and health is at the heart of the investigation. America today has atrocious health outcomes when

compared with much of the world,[7] and some theorize this is correlated to poor diets or lifestyles.[8] We drive more than others, and enjoy reveling in greasy foods, some of which involve ingredients that are flat out illegal in other countries.[9] Much as it may feel difficult to control, through individual choices we can influence what goes in the body, even if our culture emphasizes tolerance and non-judgmental thinking. As a result of the conundrum generated by aging and health problems, I will not proceed to give out health advice, but rather reference some excellent books which can help push the Immortal Investor into a healthier direction: They include: - Sugar Nation by Jeff O’Connell - The Plant Paradox by Steven Grundy - AntiCancer by David Servan-Schreiber - The Hundred-Year Lie by Randall Fitzgerald - The Case Against Fluoride by James Beck - Niacin: The Real Story by Abram Hoffer - Vitamin C: The Real Story by Abram Hoffer - Power of Vitamin D by Sarfraz Zaidi - Big Pharma by Jacky Law - Baking Soda Power! by Patty Korman These mentions do not imply full-throated endorsements by myself, or suggest they speak perfect truth; however, each text establishes a foundation of thinking which could help push folks in the right direction. Furthermore, the reader begins to see patterns of lifestyle and dieting that seem to correlate with specific health outcomes. Even if you choose to reject all of the findings, they might stimulate thoughts of how to live well, or at the very least, eat better. Health Insurance If I were to ask even the most apolitical readers about healthcare, chances are they would know something. The last decade of American politics has witnessed countless raucous debates about health insurance costs, pre-existing conditions, and public vs. private offerings. People take sides on the debate as though their lives depend on it (which has some truth), and often struggle to separate fact from emotion while going about the process. What should be understood is the following: lowering healthcare costs requires the prevention of disease, hence the suggested readings on diets and pharmaceuticals. Where insurance itself is concerned, there are several options for long-view investors.

To start, employer-sponsored insurance is the mainstay in the United States. Such programs are usually subsidized in part by the company, and also paid through pre-tax premium charges. Whenever signing up for such a program, be sure to check exactly what the coverage is good for, and any exceptions to the primary rules. The premium billed out weekly or biweekly is just the first part; plans usually demand a co-pay upon visiting doctors, and sometimes a high deductible as well. This latter amount must be satisfied before the insurance will cover a bill. Low deductibles are ideal unless you are looking to use a high deductible plan with a Health Savings Account (HSA), which allows money to be invested like a 401k for future healthcare costs. Follow this guide: - Premium: What is paid pre-tax from a paycheck. - Deductible: The after-tax amount to be paid by the patient before insurance kicks in. - Co-pay: A charge when visiting the doctor or a medical specialist. - Hospital Coverage: How much the insurance covered per day if you are hospitalized. As a word of caution, cheap premium plans could be risky unless they happen to be better than average. I once had a plan which seemed affordable, but only deceptively so. After having a procedure completed, I discovered that insurance would cover 19 percent of the bill, while paying out of pocket would have granted me a discount equivalent to be them covering 23 percent. Luckily it was a small charge. The same program only covered $100.00/day at the hospital. Since the average daily hospital bill is over $2000.00,[10] I would have been in pretty bad shape lying in the gurney for a week. For this reason, consider a supplemental indemnity plan to cover emergency situations. I bought one at $18.00 per month which covers $1000.00/day in case of hospitalization, a much better place to be in. Regardless of the case, I recommend purchasing short and long-term disability through your employer. Those coverages can provide a diminished but valuable income during periods when you may not be able to work. An alternative to conventional insurance involves cost-sharing plans. Because these are not insurance per se, the restrictions tend to be tighter, with stipulations about personal behavior and moral conduct as prerequisites. My personal experiences holds that they are useful for general care, although we have cases of folks with specialized cancer treatments finding them somewhat lacking. Thankfully, the people in

question did get their costly bill paid.[11] The plan I use charges about $185.00 per month for a deductible of $1000.00, this based upon me observing certain health standards while maintaining coverage. On that front we go back to the prevention bit I mentioned earlier. Regardless of choice, make sure to study what is covered and not covered by the plan. Failing to do so can create needlessly costly experiences, or potentially even bankruptcy. Older investors may have access to Medicare, the country’s longrunning retiree healthcare program. Unless you use Medicaid, a poorpeople insurance that requires the relinquishing of most assets to get full coverage, the Medicare program will usually pick up only 80 percent of costs. That sounds good, but look at it in the context of those daily hospital stay charges from earlier: a lot of money is either going to be eaten by the facility or paid by the patient. As a result, it may become necessary to purchase supplemental Medicare insurance plans and thus “fill the gap” of insurance coverage. Be Careful WHO You Invest For Investing books enjoy presenting a glorified image of the house, car, dog, and 2.5 kids for earnest young readers. The idea entails optimism, full-throated passion, and general happiness. That’s precisely why we need to question its underlying merits. Just as a stock advertised with “pie in the sky” perceptions is likely a hard pass, the Immortal Investor cannot afford to blindly put faith in a relationship prospect which may change rapidly over time. He or she must calmly assess the horizon stretching 20 or more years in the future rather than salivating about the clouded emotions which pure love can create. Understand how the very phenomenon of desire and spiritual affection is believed to be tied to strict chemical reactions in the brain that latch on and affect an individual’s outlook.[12] People often make foolish decisions in the name of love, at times to the point of financial destruction. Although it might seem impossible to operate logically while still giving someone genuine love and care, the trick is to start from a position of concentrated strength. Let’s take the concept of dating; it’s fun, memorable (depending on the person), and might lead to more substantial long-term relationships. At the same time, having no selfrespect when going on dates can lead to significant financial problems. For instance, a potential partner who is stingy about spending their own money and constantly attempts to manipulate others into paying should

be an immediate red flag. It’s not to say extravagance ought to replace frugality, only that the matter must be balanced between both folks. A person who values their own money above the basic machinations of a relationship will be toxic to long-term stability, particularly in the financial realm. Concurrently, an extraordinarily demanding person who sees the union as nothing more than their personal piggy bank should be viewed with disdain. Investment growth for the average guy is going to take time and sacrifice, so anyone chosen as a partner must value the relationship in of itself, and not for the gilded rewards which might come along. And easy way to check the health of the situation is to enforce the give and take approach when it comes to paying for a meal. Ask them to pay every other time so as to gauge levels of commitment. When you see a couple where one half constantly has excuses (if not insults) for the other side where paying is concerned, that would be a good sign of unhealthy foundations. It can be worse in the event they do pay, but also deliberately try for the cheapest option, whilst insisting on luxury when the shoe is on the opposite foot. Such levels of calculation and pure scheming are dangerous, because they result in one person being manipulated towards the other’s end. Left unchecked, this behavior can result in utter disaster when the question of marriage emerges. I personally view marriage as a beautiful concept, albeit one highly misunderstood by the general public. The popular image showcases two people enraptured by love, enjoying decades of uninterrupted marital bliss, during which time they “continue falling in love with each other.” Death brings the end of a terrific union, with whomever surviving spending the rest of their days “hoping to join” that special beloved. A flock of doves carries off the magic memory forged by utter joy. At this point, perhaps the reader will be kind enough to grant me a Hallmark award. Obviously there is much more up for consideration on the matter, but folks tend to get furious if presented with realities they do not appreciate. Anyone who shatters the happy perception is swiftly condemned as bitter, dejected, or sexually deprived, desperate to project his or her insecurities on the gaping world. In truth, they are merely displaying the harsh realities (or deflated expectations), tied up in the modern marital union industry. A particularly sarcastic jewelry store ad I saw reads “This is long-term wife insurance,” a claim flying in the face of

constant unions which have gone down with radical glory, plus many flames.

We can probably explain the problem by glancing at sheer biological facts. Love is a terrifically strong emotion, yet one tempered by the inescapable changes which occur over life’s cycle. People age, perhaps not mentally, but certainly physically, and consequently one’s appearance may not be enough to maintain a union over the long haul. People who craft marriages upon that basis (and indeed many do so) set themselves up for unrealistic expectations and a grinding fall. The sharpie six-pack and trim figure on the guy you married may very well become Budweiser’s Gut and manly chest pears. Her tight round posterior will likely be a lot wider, and much less firm. Such are the consequences of aging, regardless of what those romantic propagandas tell the innocent brain. Another issue surrounds how folks quickly elect for a serious track, often when they have limited knowledge of the other person involved. As a result, one must be careful about rushing into any sort of marriage or committed role until the opposite being can be properly “vetted,” so to speak. Consider the importance of developing more familiarity with the person, either by working with or living together so the opportunity to witness their true form or colors arises. Studies show that such familiarity can lead to glowering discontent.[13] The best way to achieve success in marriage is to view it as an economic alliance, as opposed to sheer romance and adulation. Both sides are coming together for the purposes of chasing prosperity, particularly in the realm of raising children. They each realize that life can be expensive, and are on the same page as far as spending is concerned. It should come as no surprise that wealthier Americans follow this model, and have lower rates of divorce than those in the working

classes.[14] Using the approach of the rich can help provide clarity in a marital union. If your plan involves living in a million dollar house and collecting rare antiques, then make sure both incomes align with that objective. Having only one good salary and two great spenders is recipe for financial disaster. In point, a frugal/extravagant pairing is bad news; one person will always feel neglected or disrespected by the others’ priorities. Conversely, two big spenders might face conflict if one of the pair loses their job or becomes too ill to continue working. Divorce One of the primary threats to the Immortal Investor’s dreams would have to be dissolution of a marital union. It could seem like nothing, but I have heard from acquaintances who claim to have lost over $1 million due to divorce settlements, and cases get more extreme with the megawealthy. Plans of stability and retirement can be swiftly dashed to pieces following a bad outcome, one which is avoidable if the couple agrees to put aside pettiness and embrace logic. While divorce may occur because of more egregious offenses like abuse, there are other cases where it is a matter of infidelity, financial problems, or simply “growing apart.” None such factors are easily dismissed, but they don’t need to become an anvil weight on future success. Let’s say you do find yourselves unable to continue coexisting within the bounds of a legitimate, love-seeking marriage. Fair enough, but don’t rush towards the costly and bitter end. A far better approach is available to those who think in terms of money. To begin, divorce is very expensive on a process basis. Getting a decent lawyer to work on the case can cost thousands of dollars,[15] and possibly much more. Those figures of course apply to both parts of the couple, and are a harsh price to pay simply for the purpose of separating. Add on the actual splitting of assets, and money is likely to be lost. If a house goes for sale and proceeds divide 50-50, the value could easily be destroyed, especially in a down market. Cars, payments, and prized possessions may also be at risk. Lawyers are bound to pit you both against each other, leading to conniving behavior and further financial bleeding. This becomes worse when kids get involved, because they end up as a bargaining chip between the two ends of a fraying union.

Alternatively, take a big breath in, let it out, punch a pillow to relieve anger, and then begin to think rationally. Broken marriages may sting, but they do not need to result in vindictive or financially idiotic outcomes. Consider the house question, for example. Rather than splitting and fleeing, look at an arrangement that allows you to still cohabitate while living largely separate lives. A good approach involves using an existing (or purchasing a new) split level, or townhouse equivalent. You can divide responsibilities and reduce the financial burden, even if one person alone is paying the mortgage. Both halves get shelter, and access to kids no longer entails complicated scheduling around jobs or different cities. Similarly, any financial improvements performed on the building are mutually beneficial, as opposed to being excess costs going past the combined living expenses of each person. Properly observed, the model can work even as either person moves on with their lives, including romantic endeavors. The other area where staying married is logical centers around taxation. Married couples filing jointly capture a significant discount when compared to individuals filing by themselves, which in of itself becomes a foundation for relaxed approaches. Should the observers be skeptical, take a look at these figures: Marginal Tax Married Filing Single Rate Jointly 10% 12% 22%

Up to $19,400 $19,401 to $78,950 $78,951 to $168,400

Up to $9,700 $9,701 to $39,475 $39,476 to $84,200

24%

$168,401 to $321,450

32%

$321,451 to $408,200

$160,726 to $204,100

$408,201 to $612,350 $612,351 or more

$204,101 to $510,300 $510,301 or more

35% 37%

$84,201 to $160,725

As we can see, the couple filing jointly at the 22 percent bracket benefits from an almost 100 percent difference in max income for that section. The drastic divide becomes even more noticeable when we

factor in the differences which couples might have in terms of income. If one partner rakes in $90,000 and the other grabs $50,000, it makes little sense to go through the process of filing independently, because a higher tax bill is likely to materialize. On the opposite, putting resources together can allow for the divvying up of post-tax income in a more sensible manner. The matter of children remains important too. Unless abuse or neglect has occurred, separating kids from their parents over disagreements is heartless and cruel. A couple who calls it quits but otherwise cooperates can prevent their children’s’ life lives from devolving into frayed, broken, and emotional circumstances. Boys benefit greatly from a father figure who is constant (and ideally biologicallylinked). Girls also need positive male examples to help them avoid slipping towards the scummier men of life. Both genders thrive under the protection and warmth of a mother’s love. Here we must exceed to surpass basic human pettiness. Yes, infidelity is wrong, and disagreements or disgust arise. Everyone has the right to be angry, but do not let that reach vindictive ends. You will merely damage your bank account and ruin the lives of your children. It might feel good momentarily, but in the long wrong poverty becomes a central path.

II. The Dilemmas of Investing Due to the somewhat whimsical nature of the subject, along with my own admitted proclivities to cover broad categories of information, I have constructed the following section around several arguments in the investing community, focused on isolating the key explanatory factor which boosts investment strategies. If the topics bounce around somewhat, understand that this is intended, as the goal remains to provide both advice and a certain degree of observation concerning popular financial debates. What About Inflation? One could argue the most valid counter to the concept of stock market investing is the inflation question. Skeptics note that U.S. government spending is at an all-time high (and keeps breaking records daily), with the Treasury running a deficit of $3.3 trillion.[16] They contend that this money policy will at some point lead to a currency collapse, wiping out the value of stocks and bonds, thus eliminating their validity for long-term consideration. As an alternative, these folks advocate buying physical metals or cryptocurrency, among other things. Neither proposed idea lacks merit, but nuance is also important. America has been on the borrowing train pretty much for her entire existence, but still remains one of the strongest military powers in the world, helping to explain why the copious spending has not caught up with us. If Americans can be there in a jiffy and cause chaos in short order, people will tend to continue valuing the dollar from a standpoint of necessity and coercion.[17] Think of Iraq, where Saddam Hussein allegedly tried to trade oil on the market with Euros as opposed to dollars; we all know how that saga turned out.[18] Similarly, Muammar Gaddafi’s attempt to introduce a gold-backed dinhar currency is believed to have precipitated NATO bombings of his country, along with regime change.[19] Ahh! Is this not democracy? To be clear, China’s rise to global dominance could threaten the dollar’s delicate position, with the People's Republic (PRC) actively expanding in locations previously influenced by the United States, which is one of China’s main export markets.[20] The latter point of course gives

the PRC motivation to maintain a healthy buyer’s network in America, one factor that somewhat tempers their ambitions. If the dollar were to become exponentially weaker versus the Renminbi, Americans might buy less from the Red Dragon, damaging the latter reptile’s economy. Nevertheless, critics are still immensely doubtful of long-term security for stocks. The argument could obviously be made that keeping your money in an inflated investment account is more logical than letting it sulk inside a savings account earning at most 3 percent, and getting destroyed by inflation, which is closer to 7 percent, in spite of what the government claims.[21] Yet is this enough? Are stimulus packages and the Federal Reserve-bloating returns preferably to alternatives? This question remains central to the debate on Immortal Investor principles, and is not easily addressed. Perhaps the best way to square stocks in the picture (apart from the alternatives mentioned later on), is to consider the power of banks. Back in 2010, Congress enacted the Dodd-Frank legislation, a massive financial overhaul of Wall Street depicted as the solution to prevent future crises like the one experienced in 2008. While generally viewed as beneficial, the bill opened up consumer bank products to great risk in the event of another economic meltdown. Provisions in the mammoth regulatory package permit banks which are in the process of collapsing to show deference to their derivative assets ahead of regular customers, seizing more than 50 percent of savings or checking account balances through a “buy-in” procedure which applies to holdings beyond the $250,000 covered by the FDIC, or less if the State runs out of money.[22] Although intended to prevent government-funded bailouts, it comes at a considerable risk to your personal finances. A similar fiasco unfolded in Cyprus during 2013,[23] and cost residents there billions as part of a rescue loan agreement.[24] Keeping such knowledge in mind, the traditional savings or checking account method of building wealth does not strike as very logical. Of course one could opt to store cash in a vault instead of utilizing banks, but this approach necessitates a large and secure holding area for the money, and of course will not result in appreciation of the base plot. It would seem then that placing funds into an investing vehicle, whether the stock market, crypto, real estate, or metals, remains an advisable option. Investment Account Types

Americans have always had complicated relationships with taxes, and it’s no surprise that the world of investing aligns with similar derision. Many folks (myself included) find it reprehensible that we are penalized for risking our wealth in the market with heavy taxes at almost every turn. As a result, most investing strategies orient around not simply growing one’s net worth, but also sheltering it from taxation. Central to this approach is the careful selection of retirement accounts, as failure to do so can result in dramatic losses over the span of one trader’s lifetime. Roth IRA I list the Roth first and foremost because it embodies the core of Immortal Investor strategy. As a savings vehicle, it comes in both the 401k and independent forms. Under the 401k version, the investor has money taken out of his paycheck after taxes, with the legal promise that he will not be taxed on distributions from the account made beyond the age of 59 1/2 years old. He can place $26,000 in the account for years 2021 or beyond, and may enjoy an employer match of his contributions (typically 3-4 percent). In plainer terms, if our friend makes $50,000 and contributes $5,000 annually, or 10 percent, his employer might add a 3 percent match of $1,500. The main downside here is that he will be limited to the funds provided by his employer, and usually cannot buy individual stocks for such an account. Note: an investor can max out both a personal Roth IRA and an employer Roth 401k each year. Providing the funds are not withdrawn before the age of 59 1/2, the user will accumulate tax-free gains on any stock appreciation, stock sales, or dividend payments nestled inside that account. Taking the money out before that age without a qualifying reason results in an immediate 10 percent penalty, plus income taxes at filing time.[25] In the case of the independent Roth account, you as the investor contribute after-tax funds and utilize them to purchase any number of different securities. The yearly cap for this vehicle is $6,000, or $7,000 for those over the age of 50. Breaking it down on a monthly basis, a contribution of $500.00 will bring a buyer into the maximum range. Be careful with making too much money during a given year, however. If annual income is above $124,000 as a single filer or $196,000 as a married couple, the IRS will reduce the maximum contribution for the Roth during that year, and demand a tax charge. Putting too much in the Roth also results in a 6 percent excise tax penalty.[26]

As far as which investments should be placed in a Roth account, the general consensus surrounds a combination of value stocks, fixedincome options, and dividend payers.[27] Bonds are recommended because their coupons can be reinvested without penalty in the IRA for future gains. Of course bonds do not yield much, so holding them may be inadvisable. At the same time, municipal bonds do not get taxed by the federal government, and thus are a better option in a mainline taxable stock account. Consider putting stocks which pay large dividends or are chosen for long-term appreciation in the Roth account to shield against taxation. Very large investments which might need to be liquidated during financial emergencies should be kept in the taxable account so there is no massive penalty for relinquishing them, apart from income taxes. Real Estate Investment Trusts (REITS) are also good options for the Roth, as they tend to pay out large dividends. Traditional 401k Like the Roth 401k, the Traditional model has a cap of $26,000 annually and may benefit from employer matching. The main difference is that your contributions go in pre-tax, and one only pays income taxes upon withdrawal at the age of 59 1/2. As with the Roth, early withdrawal means a 10 percent penalty plus income taxes. Bolstering the Traditional 401k is an assumption that income will be lower in older age, and thus taxes won’t be as problematic. While this could be true in some cases, projections indicate people will be working deeper into their older years than during prior eras,[28] [29] and thus may still be earning prime income during that period. The better reason to utilize a Traditional 401k at this point in history is as a tax shelter. A single filer making over $100,000 may not have many write-offs to speak of, and will thus pay a hefty amount of income tax on the total figure. Consider using the Traditional as a means of keeping this down, but recognize the long-term consequence of a large 401k account, because income taxes might be far higher by the time retirement rolls around. Individual Taxable Account The Roth and Traditional options are fantastic in their own way, but the primary downside lies in an inability to access those funds without the double penalty. Yearly caps also ensure you cannot dump tremendous money into individual stocks, at least not to begin with. This could be seen as a good or bad thing; if Tesla is trading at $250.00 and will be going up to $1,900.00, looser controls might seem nice. Similar

scenarios could be disastrous, so caution is recommended. Following Immortal Investor principles, the taxable account should be used primarily to store municipal bonds, plus growth stocks that are rarely sold. The latter word’s emphasis is crucial here. If a stock goes up in value, the gain is unrealized until it gets sold. Hence it is entirely possible to grow a stock investment by ten or one hundred times without suffering any annual tax bill. The only requirement is for the investor to remain calm and collected during market fluctuations. Here things get trickier, yet a steady heart and observation of investing rules plays well. See the section on holding long for more information. On the immediate front, motivations for staying in the stock for a longer period can be seen by examining Capital Gains tax rates. While long-term capital gains taxes on stocks sold after 12 months or more of ownership range from 15-20 percent, short-term rates (on stocks sold in less than 12 months) clock in at regular, extremely expensive income tax rates. Here’s a reminder: Marginal Tax Married Filing Single Rate Jointly 10% 12% 22%

Up to $19,400 $19,401 to $78,950 $78,951 to $168,400

Up to $9,700 $9,701 to $39,475 $39,476 to $84,200

24%

$168,401 to $321,450

32%

$321,451 to $408,200

$160,726 to $204,100

$408,201 to $612,350 $612,351 or more

$204,101 to $510,300 $510,301 or more

35% 37%

$84,201 to $160,725

As you can see, the cost of selling early is simply too high, and thus should only be done when absolutely necessary. Keep this table around and take a look before ever hitting the “sell” button. Doing so will help the Immortal Investor concept to prevail, expanding your wealth over time without the dominant force of fear. Speaking of such emotions, the option of a robo-advisor to manage an individual account (or even a Roth IRA) remains pliable to many folks.

These models employ complex algorithms to serve interests of lowtaxation, high growth, or balanced investing. Rather than choosing individual stocks, the user simply deposits funds which are then funneled into an assortment of index funds. Based on the time of year or state of the market, the investments are bought or sold and rebalanced to maximize gains while also diminishing tax liabilities. Robo-advisors often practice tax loss harvesting by selling underperforming funds and using the losses as a counterweight to successful gains in other areas.[30] My experience with a robo-advisor has been largely positive, although I still maintain a larger taxable account for individual stocks. The overall current gain from the robo-advisor sits around 20 percent, while my individual account recently clocked in at 45 percent. What Is The Right Investment Portfolio: Traditionally, the assumed proper investment mix for the bulk of traders was Vanguard’s 60-40 stocks to bonds. The underlying argument went that investors need exposure to enough growth to build wealth, but not so much as to place them at risk of losing it all due on a market downturn. Folks still like to parrot the model as God’s honest truth,[31] but recent voices have begun speaking out against the idea,[32] [33] largely based upon two countervailing problems. First, we have the seismic decline in pension benefits over preceding years. Back when American workers could more or less rely upon a defined benefit check in retirement, the general conservatism of the 6040 approach seemed logical. However, as these programs sprint towards extinction, investors are facing the prospect of having to possess far more money by the time they kick off the retirement period of life.[34] Having 60 percent in stocks simply doesn’t cut it unless one’s income is dramatically higher than normal. In addition, bonds have a current problem that was less significant back when 60-40 became popularized: they don’t yield much at all. While you will find municipal bond funds like NVG which offer decent returns, Treasury bonds currently bring in a laughable amount, as we can see on the government’s website:

Because bonds do not typically rise much in value themselves, it is easy to see any dividend (bond coupon) gains eaten up by inflation over time. Alternatives include corporate bonds (which don’t provide the same safety), international bonds (depends on the country), and junk bonds (higher yield but less stable). As far as Immortal Investor principles are concerned, the only bonds worth paying attention to are international or municipal and state bonds, the latter for their tax benefits, as discussed in the previous section on Roth IRAs. The main risk of international bonds lies in a governmental default, as we witnessed in Argentina, where debt holders were paid fractions of what they bought after a series of financial crises.[35] [36] Some better portfolio mixes can be found in the excellent book How a Second Grader Beats Wall Street. The initial model used by author Allan Roth’s son is as follows: 60% Total U.S. stock market index 30% international stock market index 10% Bond index As you can see, Allan Roth slashes bond concentrations heavily, boosting the total in stocks to 90 percent. He also includes a more complex option to diversify holdings: 54% Total US Stock market index

27% Total international stock index 10% Total Bond index 6% Total REIT index 3% Precious metals fund Either of Allan Roth’s proposals appear decent from the Immortal Investor standpoint, with a few caveats. Recognize that based upon the largest areas of global growth, you may need to at times reassess and make the international stocks a heavier focus. It is also acceptable to utilize other stock funds beyond the total index. For example, my work 401k features 70 percent in VNIX (Institutional Index), 20 percent in VSMAX (Small-cap), and 10 percent in VIMAX (Mid-cap). Beyond this, the REIT percentage is fine providing it resides in a taxsheltered account like a Roth IRA. Be cautious about metals funds, as I discuss later on in the book. You may not actually be holding the metal itself unless certain preconditions are met, and fees can be high. There is also little reason to hold 10 percent in bonds unless they are international or municipal/state offerings. Consider placing some of that money in cryptocurrency, especially Bitcoin. As much as digital currency might seem volatile, the endless printing of money by governments worldwide makes it a prudent hedge. Individual Stocks vs. Index Funds The prevailing advice distributed to mainstream investors is to stick with index funds and leave individual stocks to the Wall Street traders. This message was hammered home in the book A Random Walk Down Wall Street, which revealed the poor odds people face as they attempt to replicate gains made by the financial elite. Author Burton Malkiel thus nudged readers in the direction of index funds, which face far less volatility and are not at risk of one company bringing down the entire ship. While I am sympathetic to many of Malkiel’s arguments, and indeed believe index funds are an excellent vehicle for building wealth, removing all individual stocks from a portfolio can result in the surrender of massive gains. Large and long-performing companies such as Apple or Verizon have been an indomitable boon to portfolios such as my own in the past, particularly when the dividends are reinvested to buy more

shares through the Dividend Reinvestment Program (DRIP). Furthermore, names including Chewy and Papa John’s currently sit with sizable up percentages in my account, easily eclipsing the gains of most index funds I hold. As we shall see in a few pages, even poorlyperforming stocks usually return to positive levels, providing the owner avoids selling for an adequate period of time. Perhaps the best takeaway here is to structure a portfolio with balance in mind. The bulk of one’s equity holdings should probably be in index funds with low fees, while some space is allowed for stocks with high growth potential or dividend expansion. These latter options should be placed in a Roth IRA if possible to avoid being hit with taxation upon payment of dividends or selling after a big price upshift. Picking Good Stocks With that being said, where the Immortal Investor thrives is by looking at the preponderance of evidence. Thousands of “good” companies exist, but this does not mean they make great investments, and vice versa. We bear witness to examples of firms with precarious finances which do exceptionally well on the trading floors because they are popular, not simply due on performance.[37] Other firms delivering steady growth get penalized for not doing better, even though they are arguably run in a superior manner. This presents a dilemma requiring reconciliation to avoid major losses. We can begin with a number of steps: 1. What Is The Reputation? Has the company been around for a long time, or is it some gallant spring peeper coming to the rescue? Neither are guarantees of grand management operations, yet they present a picture of sorts. Wal-Mart has been a staple for decades, while Tesla is less ancient. Both have leaders who deliver in their own ways. On the flip side, newbies like WeWork and classics such as General Electric perform differently, and Wells Fargo is the horse-drawn wagon in the courtroom. 2. How Much Can They Endure? Is the business model becoming technologically-redundant? Older companies unwilling to adapt are going to struggle immensely

as years pass. If the present generation buys online and the firm has tons of physical stores, they might need a double-check before money gets hot in the brokerage app. 3. Are They Popular? Here we must be cautious. Enron was a hype company, after all, but that did not make it great for investors. At the same time, look at how many companies rise based in part on their popularity. Tesla is a major one, plus Beyond Meat. The latter company jumped from around $66.00 in May 2019 to $234.00 during the summer, before cooling off. When Kodak was announced as the beneficiary of a government program in July 2020, it shot from less than three dollars to over $60.00 in the space of 48 hours. As cries of insider trading abounded, regulators suspended the award while an investigation could take place. Kodak’s stock proceeded to plunge almost 50 percent in one day, burning those who got in late – or stayed later than they should have. 4. Financials The bottom-line is not always a decent guarantee, but it can be an insurance policy. In her book GameChanger Investing, Hillary Kramer recommends stocks with a price-to-earnings ratio of less than 18, year-on-year profit increases of 10 percent or more, low debt-to-equity ratios, and a return on equity of 15 percent or greater year-over-year.[38] While high obligations can be part of market leverage, too much which never drops and always grows can easily become an issue during times when underlying aspects of the market are poor. Think of COVID-19: if the chosen firm cannot make money, how will that debt be reduced? 5. Analyst Opinion Once again, the subject is dicey. Analysts tend to have minimally accurate abilities to prognosticate, despite what they pretend to do on television. Goldman Sachs for instance is renowned for advising buys after a stock has already climbed very high, thus setting up people who follows its staff’s advice to miss out on the bigger upswing. The practice may or may not be deliberate on Goldman’s part, but it emphasizes the crucial understanding every investor must have: analysts are usually clueless, and never your friend. Avoid becoming too enchanted by one individual’s articles, vlogs, or cable TV presentations. They are probably pushing a specific

interest, or could in fact be grasping for straws so as to have some content and entertain. Keep in mind that some of the best stocks may be getting trashed by analysts and the market at-large. After the controversy over Papa John’s CEO John Schnatter’s remarks in a conference call some years back, the stock was left for dead by empowered virtue signalers in the analyst community.[39] Martin Goldberg however purchased it at $44.00, and rode the wave of COVID-19 lockdowns up to over $100.00 per share. Analysts can suck all that frozen pizza they heroically bought to slight the eternal Papa. 6. How Much Are They Relatively Worth? A subjective question lurks here. Just because a stock might appreciate does not mean it needs to be the bulk or lifeblood of a whole portfolio. Sometimes more modest holdings are preferable, particularly if you are not rock solid on a positive future actually materializing for those shares. So if the company is a small-cap and they don’t have an absolute lock on the market, you might reconsider dumping tons of money into the pit. This goes back to our discussion of a stock’s ability to withstand economic struggles. Smaller firms without access to the same credit or market share are riskier if things happen to go wrong, while large companies can outlast the normal market bumbling. Margin Loans and Building Capital I have spoken before about the conundrum facing new investors where finances are concerned. Sure, you can invest in stocks, but there is the question of developing that initial seed money. After all, expensive stocks aren’t going to be much use if the buyer can only afford to purchase barely one share, at least in theory. Fractional Share Investing has actually changed this dynamic somewhat by allowing buyers to purchase slivers of one share,[40] but those tiny bits will only amount to so much. Here we must tackle the issue of startup funding. New investors often ask me about the benefits of using margin loans to invest large sums of money at the get-go. For those who don’t know, a margin loan is a promissory note issued to the trader which allows him to buy stocks with money that will have to be paid back. The logic suggests his stock’s appreciation will more than cover the cost of interest, making it a solid deal. I mean, what could go wrong?

As it turns out, a whole bloody lot. Should that stock decline in value, or simply remains dormant, you will be on the hook for expensive interest payments lasting years, in effect paying for the privilege of holding that losing investment. Just like paying an annual fee for a credit card makes no sense, paying a regular bill to hold an investment (beyond low-cost fees or commissions) is naïve folly. The detractors to my position are of course bound to argue that “debt can be leveraged to make more money.” No opposition there, but does that person have the intelligence or wherewithal to do so? Here we begin to see the pins drop, without background music, of course. I have never met a person who admits to being stupid, and still less are certain of success beyond vague, self-improvement slogans. The fact that some dude in a book or on the internet preaches the merits of doing better in life and business does not mean adherents will be lucky by default. It is entirely possible for someone to enjoy maximum confidence and read about positive mindset techniques, while still losing considerable money. That’s where caution comes in. Should a person burn $20,000 on the stock market by playing risky penny stocks or doing day trading, a frowny emoji might rule the land, but at least they are now clear. Same thing when a real estate property loses value; it can’t be sold for profit, though there’s still the option of renting rooms out as long as the mortgage gets paid. By contrast, losing $20,000 on margin leaves you with the looming principal and interest payments on that balance. Avoid being a “smart guy” with margin treachery. Leave these higher risk options for Wall Street traders backed by massive financial firms and Federal Reserve monopoly money. They can absorb a fifteen round punch session and still be smiling; your bank account? Not so much. A superior approach to the startup debate involves investing gradually with a Roth IRA. As little as $100.00 per month can be deposited in this vehicle and grown towards the sum needed to become wealthy, allowing those with smaller incomes to participate as well. Furthermore, the nature of the Roth means they can go in and out of stocks for quick gains without getting charged short-term income tax. For equities that are more affordable, consider utilizing a respectable penny stock service. I personally have had great success with Falcon Stocks, which provides recommendations on cheap companies with legitimate growth potential. Be careful however to avoid the free newsletters or

blogs that simply pump up small shares to sell for a quick profit at your expense. Avoiding Fees The development of mutual funds and their fellow index comrades, along with ETFs, has worked to revolutionize the investing possibilities for average people. Prior to their flourishing, the main way to purchase shares was through a broker, who could take advantage of a buyer’s lack of knowledge, or the absence of internet access to fact-check certain proposals. Choosing well meant success, while bad calls (or even a poor market) wiped out the investor’s nest egg. It was then much easier to conclude that the market is completely rigged, simply due to bad advice. Then came the funds, and their powerful new dynamics. Instead of individual stocks, they allowed people to buy multiple companies at once in the aggregate, offering stability and financial diversity. If one stock fails miserably, the outcome can feel pretty harsh in your stock account. Conversely, a single stock declining out of many significantly lessens the blow, because of averages. The stock grouping can also pay dividends extracted from that larger bloc, making it an ideal combination of value and growth strategies. Another advantage lies in the fund’s typically cheaper price tag. While this may vary, you can often find an index fund that contains Amazon stock for less than the individual price, which currently hangs around $3280.00. For the younger Immortal Investor, it can be difficult to begin purchasing stocks without much money, aside from the Fractional Share Investing mentioned earlier, and thus the mega expensive option is unappealing. Much as funds solve this myriad of problems, they come with a disadvantage typically foreign to regular stocks: management fees and expense ratios. Now you might say, “Hold on Martin, stocks DO have brokerage fees!” That’s quite correct, but the charges doled out whenever one buys or sells a stock (at this point quite cheap), are different from those demanded simply to OWN a fund continuously. The MBAs and Associated Industrial Diversified Stocks experts are not putting together and managing these funds for free; they have to be rebalanced and moved around on the semi-regular, so the piper insists on getting paid. Of course some pipers are greedier than others, and hence you ought to be careful when buying their offerings. In the event one wishes to purchase a fund, whether on the open market or through an employer 401k, look closely at what expenses will

be required. For example, I own FDIS, a Fidelity fund with an expense ratio of 0.08. Typically, the charge applies to all fund assets yearly, so if I have $10,000 stored in the fund, that means 0.0008 times the total, or $8.00 per year in fees off the top. Doesn’t sound too bad, right? Now let’s look at the bond fund XMPT, which is headed by VanEck Vectors. Although it provides an income stream, this comes at the cost of a 1.86 percent expense ratio, or $186.00 per $10,000 invested. Depending on the relative yield of the fund, that’s a lot of money to be losing annually simply to HOLD the investment. In fact, one analysis suggests a fee of as low as 1 percent can amount to costs of $590,000 in retirement savings over forty years.[41] In general terms, bond funds and foreign ETFs have higher ratios than domestic equivalents, which might have something to do with the taxes required in other regions. At the same time, T. Rowe offerings and American Funds can be horrendously pricy themselves, so the bias fades before it can settle in. I have typically found that funds from Vanguard and Fidelity provide more affordable options than the other selections. If you have an employer-sponsored 401k, be sure to check for those names, as they almost always charge less than their contemporaries. Do not however take this as some carte blanche argument in favor of such companies; in some cases they may charge MORE money, so one is advised to investigate and cross-reference everything. Check the prospectus, the company website, and look at profiles on places like Seeking Alpha. These will give a more substantial picture of what precisely goes into the purchase. Think of investment fees in the context of a long-term picture. A person who starts contributing to a 401k at the age of 25 and dumps $50,000 over ten years into two funds will see a massive difference depending on which is chosen. Taking our previous example, the feller holding FDIS with the 0.08 percent ratio will be spitting out ten percent of the fees that a person on another fund with 0.88 percent will be paying over a decade, and that’s not including how the ratio will be applied to whatever gains occur on the fund over time. For a nifty comparison calculator, visit Begin To Invest.[42] So you get a sense of how important careful selection of funds can be. Across a longer period of time, stocks tend to rise in value, while fees can do much the same. Stay abreast of the issue by analyzing the details before buying, and check your funds

regularly. There’s no reason to get stuck in a fund with poor results and pricy fees. The Value Trap Another problem facing the Immortal Investor relates to the appearance of a stock which is “too good to be true.” Unfortunately, we all have different opinions of just what “too good” looks like, so clarification is called for. Suppose you happen upon a security that seems absolutely great. The price is right (or keeps getting better), and the dividend blows any shabby bank account clean out of the water. Funds are locked and loaded in the trading app, and the slightest click sends them towards the warm embrace of a simply flawless choice. Angels begin to sing. But one of them coughs, thankfully. As much as the investment may look impervious, therein exactly lies the problem, because no investment is. The reason the stock appears under such light is on account of clever marketing from the company owners. They realize how important it is to get people on board, and thus the welcome mat looks better than any actual growth potential to come. Right there is the cue to hold up, reassess, and perhaps consider a different option. It’s not to say the possibility of a golden egg cannot exist, only this particular model doesn’t feature one. The best way to detect a value trap is to go back to those underlying principles proposed by Hillary Kramer earlier. At times stocks do indeed have large dividends, making them appealing for both the value investor (focused on reinvested quarterly checks) and older buyers chasing a fixed income. Ask yourself however why the dividend is so high. Does it reflect a long history of steady dividend growth over the years, or a large and expensive burden on the company’s books? As we’ll see in the section on holding long, certain companies may hold out and pay dividends to avoid losing investors, even as the broader corporate ship goes below the waterline. Sites like Dividend.com can provide useful information on this front:

There is also the possibility that a stock simply appears good due to its general market popularity or associated credibility. Back in 2011, the pharmaceutical company Valeant began a steady rise from $32.00 per share to up above $263.00, an achievement which attracted great attention in the market.[43] The respected Sequoia Fund went so far as to place 14 percent of its assets in Valeant, no doubt expecting continued growth in the future, and perhaps a stock split as well. At one point Valeant even made up 30 percent of Sequoia’s assets based on its meteoric rise. Due to a series of scandals and missteps, the stock price had collapsed by 90 percent in March of 2016, and would carry on its ignominious fall from that position. Nevertheless, before and during Valeant’s demise one could still find ready advocates pumping up the stock and defending the apparently unquestionable value of the company, with legendary hedge fund manager Bill Ackman losing an estimated $4 billion on the shares.[44] The lesson here is that sometimes piling on is the wrong move. One could have certainly seized a large gain on Valeant and simply moved on, but the grating desire for money encouraged many folks to double down, in the process mutilating their investment capital. Likewise, the allure of a juicy and bubbling stock roped in earnest souls who then got strafed when reality came calling. Such value risks will never be gone from the marketplace, so study relentlessly before making a final decision to buy or hold a stock. Contrasting Tales of “Long” In the investing world, we often hear folks describing their respective positions on a stock as being “long” or “short.” The latter typically refers to a person who is using options to bet against the success of the share

price, or alternatively might be employed by a chap who will sell his shares in a time period of less than 1 year. He might do so as a means of securing a respectable gain, but will fall victim to short-term capital gains tax, which clocks in at the brackets of ordinary income one faces for earning a given salary during the year. It is thus in his interest to ensure the gain significantly eclipses what will be paid on taxes and trading fees, or else the sale becomes a financial loss. On the flip side, long traders believe in the value of concentrating their funds within particular stocks for years, if not their whole lifetime. Instead of selling they proceed to buy more on an incremental basis, perhaps reinvesting earned dividends through DRIP. They theorize the shares will continue growing over time, generating further wealth whilst evading the snarling grip of taxation. If we are looking to follow Immortal Investor principles, holding long will almost always be the path to take. Almost. While the belief structure remains practically a surefire guarantee of success, we must not fall into the flight pattern of ignoring very real examples of downside elements. How It Can Work For an example of what holding long can do, let’s consider my investment in Smith and Wesson during October 2016. The stock, which had been climbing over the previous year, seemed like a decent speculative play, especially with the likelihood of Hillary Clinton winning the presidency. The New York Madame had made her intentions on guns pretty clear, suggesting that manufacturers would see a surge in sales as she entered the White House. My plan, perhaps not as well thought out, was to ride the probable bounce and sell out for a solid profit. I went ahead and bought 50 shares at around $26.00 each (be advised that the stock split and changed symbols, so current charts may not reflect it). Then Trump won. In a matter of weeks, SWHC (later AOBC and now SWBI) began an aggressive slide downwards, until it broached the $10.00 range in 2017. Corporate developments caused it to change names to AOBC, or American Outdoor Brands Corporation, creating a fresh stock symbol as well. Nothing really changed, but bad earnings reports continued battering the stock, until it got dangerously close to $8.00 per share. Throughout this period, there were many moments when I figured I would sell for a loss and be done with the whole affair. I even loaded up

the sell order on my broker app multiple times, rested my finger over the “submit” button, and stopped. It just didn’t seem right, despite how the investment was stagnant and in the red. My mind refused to run ahead and make the leap, opting to keep the winsome thing for a little while longer. Fast forward to 2020. A feller named George Floyd died while being arrested by Minneapolis PD, and the country burst aflame. Rioting ensued in many cities, costing billions in damages. Several municipalities went ahead with plans to defund their police departments, and anarchists continued their violent agitation throughout the nation. In reaction, the rechristened Smith and Wesson stock under SWBI embarked on a steady rise, day after day, until in July 2020 it had surpassed my average cost, providing an opportunity to sell at a (small) profit. Here we have an instance validating the “they all go back up eventually” thesis of many investment books. I tend to agree with the general sentiment, although several angles need further consideration. That money was dead for almost four years, so I had to essentially pretend it did not exist. Beyond this, the fact that Smith and Wesson did not pay a dividend meant I could not keep buying shares at lower prices using DRIP. The money (which was around $1300.00) could also not be employed towards other buys during that roughly 4-year period because I was trying to avoid a major loss on the purchase. This is why holding long becomes so difficult for most people. We hate to lose, but even worse to feel failure across an extended stretch of time. Nevertheless, MOST stocks operate the way Smith and Wesson did, although you have to distill out garbage players based on industry and long-spanning historical trends. How Long Goes Bad First on the dial of long disasters would be oil and gas companies, especially the offshore drillers. Back in the 2013/2014 timeframe, one could find articles aplenty arguing for these dividend-producing monsters as solid investments liable to double in the near future. The reasoning appeared solid; oil prices were high, and the Middle East unstable, thus an upside would likely emerge. Offshores in key were valued for their fat dividends, which ran as high as 6-7 percent, looking like apparent benefits to fund DRIP strategies or retirement income. Life shone with a brilliant song.

But it was not to be. A combination of military action in the Middle East, the adding of oil to the market from Libya and Iran, and North American gas development created a glut which tanked the price per barrel of oil,[45] decimating these companies which appeared otherwise invincible. As prices fell, oilmen went on television, frantically predicting the commodity’s return to over $100.00 per barrel.[46] One would continue pushing the high oil mantra for several years before selling off his holdings in the luscious liquid.[47] Still the stocks sank, with several going bankrupt, including the muchlauded Seadrill, as we see from the charts. The stock went from around $39.00 in the summer of 2014 to barely 25 cents by the end of 2017, the same year it declared bankruptcy. What’s more, the company slashed its $1.00 per quarter dividend in December 2014, an act which brought the value of the company down by $3 billion due to an investor backlash.[48]

Stocks like Seadrill are a good demonstration of the Sunk Loss Fallacy. Under its terms, people who have already lost a certain amount of money on an investment will tend to double-down and stay, dollar cost averaging by purchasing more shares. They develop a loyalty or romance of sorts for that initial monetary splurge, and assume it will go back up simply because some moral platitude says so. In one sense,

they prefer to lose all the money by holding than simply admit to being wrong.[49] Guard yourself closely against this behavior. In my first book, Total Invincibility, I discussed how trading on paper without adding real money to the mix can be a great idea, particularly for investors just getting started. It allows the trader to assume maximum risk without losing any money. The method also helps steer clear that dangerous feeling of overconfidence which can lead to reckless action with significant downsides. Too many fortunes are broken upon the altar dedicated to pure arrogance and haughty self-worth. Whenever an investment goes down significantly, say more than 20 percent, perform a vitals check. Why is the company struggling? Did they merely have a bad quarter, or is the broader industry contracting while they cling to outdated business models? Are we simply in the middle of a market sell-off, or is this guy burning while fellow travelers do fine? Look widely, reading both contrarians and supporters. Avoid getting trapped in the rut of assuming contrarians are your enemies, and fanboys your friends. Everyone is motivated by money in the investing world. Some folks will dump on a stock because they wish to short it (profit as the price falls), while others express legitimate concerns. Distill the information, reflect, and then act. When Long Is Not Long Enough In his famous book, The Zurich Axioms, Max Gunther outlines classical risk rules for investments. He argues that it is acceptable to take gain, as long as it is a gain, while that is still the outcome.[50] This is preferable to holding on and potentially losing the investment wholesale. His wisdom can in many cases be accurate. I have certainly experienced stocks in which selling earlier might have avoided losing out on a decent gain. The suggestion rings exceptionally true where cases of short-term windows are concerned; an older person may not wish to wait three years to see an appreciation blossom, or in fact cannot afford to do so. Getting in and going clear with as little as a 15 percent gain could be the right option for their financial pot, even if that means missing the future high. With that being said, selling too early can become another critical error. The urge to break free with a positive gain without risking loss might well guarantee the failure to seize a nice holding for growth over the years. An example of this would be Nvidia, which some people sold

after it rose from $18.00 to $33.00 in 2014/2015, though shares would continue climbing to over $540.00 in a few years. Also remember that unsold stocks are a tax shelter, even in a taxable account. You will you be hit with short-term capital gains taxes by selling in less than a year while long term taxes can be at least delayed if one elects to avoid the discharge button. In the event the stock is sold, any money redeployed from that gain into a new stock will eventually face taxes from the fresh investment’s selling. To put it frankly: they are going to get you somehow. Therein lies the heart of the long-term argument: it may be difficult to ride waves of uncertain development, but at least the possibility of not paying governments more is appealing. Sure, perhaps having all such money concentrated will prevent its utilization in other stocks, yet that is the reality no matter how investing is approached. To a certain degree, being content with what you have in the market is useful; this should not be taken as an appeal to ignore red flags, but rather a foundation for economic peace of mind. The Delicious Apple Let us illustrate the issue with short-term sells by examining Apple stock. In August 2014, I deployed a chunk of capital to begin my position in the tech company. For several years before this point it seemed sensible, but I was rather impressed by the high price, and thus did not try. Summer 2014 brought a large stock split for the company, and I bought some at around $94.00 per share. Nine months later in May 2015, Apple was sitting around $135.00 per share. A memorable article on Seeking Alpha (which I sadly cannot find) predicted that Apple was blocked by a psychological barrier, and thus could not go higher than its existing mark. In a move which shocked no one, the stock continued to climb, but by summer 2016 it had declined, and was vacillating around $100.00. I definitely thought of selling, given the performance and sizable gain, but simply did not elect to do it. Two years later, my Apple stock was over two hundred-fifty dollars per share, but once more I demurred. The same occurred in early 2020, when the stock hit $327.00 per share. I held back, despite feeling as though to the peak had already been reached. Several months in the future, Apple would hit $500.00 per share, shortly after it announced a stock split which quadrupled my position in Steve Jobs’ wonder company.

It should go without saying that mine was a risky decision. Nothing guaranteed Apple’s ascension, nor even continually so. At one point in 2016, the stock actually sunk back to my original buy price, and could well have gone red. Perhaps the IPads and laptops might have lost popularity in those years, or competition spiraled out of control. Any number of combinations, like poor sales or corporate malevolence, could have torpedoed the share price and left me regretting not getting out while the fat lady was preparing to serenade. There are certainly no hard and fast commitments for success in the stock market, so one uses the preponderance of evidence in favor of a particular risk. In the case of Apple, the evidence was skewed in its favor, and eventually played out handsomely. Past Performance/Future Drama Investing circles like to rhapsodize the importance of this tricky notion, and understandably so. Young investors in key may get bedazzled by impressions that a stock which was once quite high is now lower—but will naturally return to that former price, and hence an investment is called for. Not necessarily. The stock could return to its previous heights, or it might not. In fact, new lows may be tested, or even bankruptcy. There are no guarantees. Concurrently, we have many cases where bigger stocks decline, only to surge back upwards in the future. What must be stressed is the definite uncertainty wrapped up in the issue. Stocks can be extremely fickle, and as a consequence their destinies will not always fall within the bounds of predictable behavior. Central to the issue here is basic human nature. If the statement sounds cliché, rest assured, it is meant to be. We must after all consider how people tend to think. Rules are rules (aside from speed limits), and laws establish fierce regulations which must be obeyed. Paychecks come on time so long as you work forty hours a week. Science is “settled.” Such cultural norms seem irreplaceable, which is precisely why they prove so dangerous to the average Joe’s brain. He begins to declare everything in life to be governed by these unquestionable principles, and lowers guard where a defensive stance is merited. What’s more, he will angrily defend the rule, or flaunt all valid skeptical opinions, becoming enraged if anything waddles into the lurking path. Consider it this way: Paul-Sean and Frank Ball Park both examine a possible stock. It has dropped from $50.00 per share down to $38.00 because of economic turbulence. Frank Park eyes it with unease, but

throws money forth because the price used to be higher and thus, “It’s got to come back up.” Paul-Sean on the other hand holds off, because he is not certain the company’s heavy physical presence plays well alongside the growth of e-commerce. Who wins? That’s hard to say. A couple of examples definitely cloud judgment here. Stores like Sears prospered for years with their rich, building-based model, making it a fixture on the economic landscape. If you went back a couple decades or three, people interacted with the retailer as a matter of course. Looking at Sears in that time, including their popularity and presence, would lead folks to believe they were good for “The next fifty years or so,” and thus a solid buy. Here we have a clever example of how technology and culture may find themselves destroying an existing norm. Sears, which was once known for its widespread mail-order catalog service, could not effectively compete with the frothing scourge of Costco and Amazon. How could one tell what was coming? Simply by taking a walk through a Sears store. From my experience, it was always striking to see the plethora of department-specific cash registers, excess employees doing little work, and inventory which was overpriced and undervalued. Certain sections of the building would be completely devoid of merchandise, and cleanliness lacked throughout the place. Sears was simply a bitter picture of sickness and decline. This may not have been evident by looking at the stock, which was still around $65.00 back in 2011, but doing individual research proved quite effective.

On Target Now let’s take the Target example. In mid-2017, the department store’s stock crumbled to around $51.00 per share on the heels of bad earnings, online competition, and general skepticism about the viability of brick and mortar retailers. Nevertheless, the company managed to climb back out of the hole, and currently stands at around $195.00 per share. Sure, there are no absolute certainties with investing, but in the case of the big red dog, several factors worked in his favor. To start, Target’s market share. Although technically a department store, the company offers respectable enough clothing options that can compete with Macy’s and others, while still showcasing advantages seen in grocery and home goods sectors. These are critical, because they enhance the “family shopping day” experience. Kids can look a toys, teenage girls will browse the clothing or jewelry sections, and Dad can look into more lawn care stuff, while Mom takes his debit card to pay for everything. It’s a perfect system. You’d be hard-pressed to find another spot with the draw that Target has on so many different levels of the market.

“Yeah, but what about Wal-Mart?” Good question, and it serves our underlying secondary point. While Wally World commands a large swath of the department store market, it struggles to match the quality of the big red dot. This isn’t to say Wal-Mart lacks premium offerings, just that their model is predicated on providing cheap goods to lower and middle class people. The crowd they entice is less obsessed with quality and experience, and more about price. Target on the other hand is designed to promote the premium class image. The coloring of the store, employee uniforms, and designs of the endcaps are all directed towards implying an environment of superior worth. Prices are slightly elevated from Wal-Mart’s, not only because they cater to a different audience, but still more as a sign of the “upper class” feeling. Such observations might seem laughable to the average observer, but perceptions matter. How many times do you really hear middle class white women talking about “shopping at Wal-Mart”? Probably very few, yet such specimens will spend hours perusing the offerings at their local Redland store. Target in this way has developed a culture of its own, even while online shopping continues gaining steam. As an Immortal Investor, you must learn to pay attention to such social trends in the pursuit of wealth. Investments driven solely by

disconnected figures and assumptions – or the buyer’s ignorance – can easily end up in smoldering piles of refuse. On the flip side, “knowing” where the money is going affords advantages not native to entities far removed from your everyday life. A decent rule of thumb (which remains imperfect) is to ask, “Would I buy that, or do business with the company?” If the answer is a hard No, exercise more caution by investigating who exactly disagrees with you. Don’t Be Too Liberal (Or) Conservative Nah, we’re avoiding politics here. A sizable problem which can explain the impoverished nature of people is their extreme moralizing over investment choices. When presented with a decent stock to buy, they begin to vacillate and squirm, searching dutifully for a sign of the company’s flaws, with politics or human rights as the lens. Suppose someone is a “passionate progressive,” and they oppose buying oil stocks because of pollution or Middle Eastern wars. Fair enough, but now you need to figure out just how many stocks fit within the hunkydory, Fair Trade canvass. Truth be told, few multinational corporations will come anywhere near the expectations and requirements of our neighborhood progressive leftist. Nike for instance has placed itself at the head of the pro-social justice bandwagon for many years, pushing for gay, black, and trans causes.[51] [52] That’s all inside their rights, but the satisfied liberal investor has to be content with the shoe company’s use of sweatshops and slave labor to produce its t-shirts, along with other apparel.[53] This practice can hardly be described as secret, but those who preach the virtues of investing in the firm reliably leave it out. At some level of the supply chain, most companies are committing acts deemed unacceptable by the social justice pontificators. An investor must act shrewdly to grow his plot – or gain nothing at all. On a similar note, be careful about becoming too hesitant with certain investments, as this can lead to less success down the road. This is an example of how being too conservative can actually diminish one’s opportunities to make money. For instance, suppose you have a stock where the stars really align, such as Apple in my earlier mention. “Hell yeah,” goes the mind, and that buy order is initiated – only it’s not. You hold back, either not buying at all, or severely reducing the total amount purchased. This behavior is natural in many ways, basically heralding the instincts for self-preservation which we have discussed before. With risk

however there comes a time to bite the bullet and go. Once all diligence has been done regarding financial analysis, buying low (or lower), and considering trends, then comes the time to make that jump. Don’t sell the baby and house for such purposes obviously, but be careful about remaining in utter terror over the basic move. There are moments when putting those funds at risk is the best possible way to move leaps and bounds on the financial plane. Cowering in white knight defense of a savings account can feel good from the psychological point of view, but it will never make the individual rich. Money is ultimately a tool, one to be employed with skill and determined focus in pursuit of wealth.

III. Beyond Stocks Metals Gold (or other precious metals) have been the longtime popular choice for market skeptics. They point to the expensive history of humankind treasuring the shiny pieces, and suggest it has intrinsic value which cannot be mass-produced like paper currency. While these folks have a point on the easy creation question, let us not become deluded into ignoring the future. Scientists DO in fact have the ability to create gold in a lab, albeit at a very high production cost.[54] [55] As much as it remains beyond the ability of household alchemists, don’t dismiss the possibility of a corporation, well-funded terrorist group, or the State choosing to create gold, either to enrich itself or to destabilize the market by flooding it with excess supply. “Intrinsic” is also a questionable label, as people must choose to see (or be told to) declare something worthy of that status. Think of the U.S. Dollar; fundamentally it is only a piece of paper that embodies the exchange of goods and services, with the imprinted government letterhead to boot. As much as mass printing may be a real thing, most of you will not ignore a $100.00 bill lying on the sidewalk, because you still believe it has value. If 50 million people spontaneously choose to boycott the dollar as a currency, the value of that paper in their circles would change dramatically. Likewise, if people choose not to value gold as a currency, at best it would be useful as a part or component for electronics. There is no guarantee that gold will be deemed valuable by enough people around you, even in the event of a doomsday economic collapse, when materials like food and weapons would likely hold higher currency. Thus it is important to not take the gold-seller advertisements too seriously. Yes, gold and other metals can be a shelter for value, but don’t look at them as some panacea. Regarding performance, let’s take a gander down memory lane for consideration of metals versus stocks over the years. Since the 1970s, gold has indeed risen steadily alongside the SNP 500’s fluctuations, albeit with far less substantial returns.[56] [57]If someone bought gold at $35.00 per ounce in January 1970 and held until August 2020, they would have experienced a return of over 5,800 percent, which is quite

good. Conversely, a fellow who invested $100.00 in the SNP 500 fund in January 1970 experienced a gain of over 15,000 percent by the end of 2019. Two important factors ought to receive consideration here. First, gold does not pay dividends in the traditional way, unless one buys a specific industry company such as GOLD (Barrick Gold), or FCX (Freeport McMoran). In the case of gold and silver trusts like GLD or SLV, buyers pay a pretty high expense ratio to hold shares, currently sitting at 0.40 and 0.50 percent respectively. Another option for silver is PSLV, which carries an expense ratio of 0.67 percent, though the shares themselves are currently cheaper than SLV. The problem with such trusts is that you do not own the physical gold, only certificates, and must have a requisite high amount of shares to even request the original metal.[58] This makes it much harder to utilize the precious block itself if need be. Of course physical ownership requires that you stash away metal in some sort of vault, making it less portable, especially if we’re talking bullion bars. My advice is to focus on accruing physical metal that is lightweight and easily transportable, whether gold, silver, or others. If you don’t have any, begin by purchasing smaller denominations, and be careful with pawn shops. They do provide the advantage of cash transactions if you don’t want the State to track purchases, but the price can easily be higher. Some popular sites to buy coins online include J.M. Bullion and APMEX, while eBay has a decent assortment of metal pieces as well. Bitcoin Around a decade ago, the new face of cryptocurrency burst into our world, powered by a generation of tech-savvy and alternative-seeking individuals. While at first under the radar, the flagship Bitcoin would rise to a historical high of over $28,000 by the end of 2020, and is predicted by some to reach $150,000 per coin in the future,[59] or even as much as $500,000.[60] As astonishing as that might sound, the digital currency is steadily advancing in popularity, making it the prime target for those seeking new troves to deposit their savings. Still, the future is difficult to predict accurately, as the following image suggests.

Cryptocurrency works roughly as follows: complex algorithms allow supercomputers to “mine” coins, or extract data, which can then be used as a form of exchange with much lower transaction fees than traditional credit cards.[61] Bitcoin, which trades on popular exchanges like CoinBase and Kraken, is believed to be safer than monopoly moneyprinted stock investments due to its mathematical cap of 21 million coins. Thus states can’t come in and simply generate more Bitcoin to pay for things they are unable to afford, inflating the currency. Libertarian advocates also point to the alleged difficulty in regulating the coins as an argument in their favor. These are all valid positions to consider, and Bitcoin should be part of your portfolio, but it is not all sunshine and roses. To start, other cryptocurrencies exist in highly volatile online markets, some of which are effectively penny coins being pumped and dumped for short-term gains. Whether governments may create their own crypto in the future is a real possibility, and one with the potential to impact digital markets significantly.[62] As to regulation, there is a clear and present likelihood that it will come forth. Already people have gotten attention from the IRS for crypto tax reporting,[63] and in 2020 the federal government floated a plan to regulate cryptocurrency wallets.[64] Furthermore, a number of governments have seized large amounts of cryptocurrency in the past.[65] [66] Even if the State finds controlling crypto more difficult than stocks, it can easily apply restrictions to the technology used to mine and process these coins. Compared with gold or silver, Bitcoin and other cryptocurrencies are certainly more portable, yet be aware of the energy risk. Having no access due to networks being down or limited power in a more extreme scenario could spell destruction for those seeking to utilize the money. By and large however, continued connectivity and the Internet of Things

should hopefully undermine these concerns. As with anything else, be cautious about putting all your eggs in one basket, particularly when that basket is entirely virtual. REIT Services Real Estate Investment Trusts (REITs) are investing vehicles which focus on establishing a crowdsourced stake in particular funds that pay out regular dividends to buyers. Utilizing this avenue permits investors who are either unable or uninterested in purchasing physical real estate to get a slice of the market from the safety of their computer. One can either invest using individual REITs or go for services such as Fundrise and EquityMultiple. My personal experience has been with Fundrise, so the pros and cons will be considered here. To start, investors can choose from three different plans, including a long-term growth portfolio, supplemental income, and balanced investing. I have primarily used the second option, sporting the following outcomes since opening an account in Fall 2019:

The returns aren’t spectacular, but considering my rather small investment to start, it is not too shabby. Of course those dividends ARE taxed, and given the nature of the various REITs involved, users of Fundrise will end up with multiple forms to report when tax filing rolls around.[67] On this front, it is highly advisable to place REITs in a Roth IRA, as we discussed earlier. While imperfect, Fundrise has a partnership with Millennial Trust Company that allows users to put their REITs in a Roth, while the firm collects fees of 0.85 percent for asset

management and 0.15 for investment advisory services. Furthermore, an annual $125.00 charge must be paid to Millennial Trust Company. The latter figure is not desirable from a low fees standpoint, so it may be better to either pay taxes on the REIT dividends in a standard Fundrise account, or alternatively choose non-Fundrise REITs and place them in a personal Roth IRA. Some possibilities are listed at the end of this book. An important dynamic to appreciate with Fundrise is the existing policy on withdrawals. Because of the nature surrounding the eREITs as investment projects, Fundrise locks in money after ninety days and charges redemption penalties after that point. If an investment is held for less than a year, for example, Fundrise takes 3 percent of the share value upon withdrawal. The closer the fund or project is to maturity, the lower this percentage will be. Just understand the situation before committing too much money. Lending For Money An angle of investing less commonly-promoted is the peer-to-peer lending idea. In this case, you invest money in smaller level loans, gaining a steady payout with interest assuming the debtor pays his dues. A popular site I have used for the opportunity is LendingClub, which puts out offers including credit card consolidation loans and personal lines of credit for investors to monetize. Although not a central aspect of my investing strategy, the service does occupy an experimental role since I started in early 2020. At the time I purchased two different liabilities, one related to credit cards and another loan, throwing $500.00 in each. For research purposes, LendingClub allows investors to look at risk profiles that run from A-D in terms of descending quality. Higher risk options may or may not contain better payouts. We see an array here:

After holding it for about twelve months, I’m sitting at a gain of 35 percent thus far. Note however the maturity date in the second column. Two years still remain before completion, so there is a chance of something going wrong. Alternatively, the fellow owing the loan might pay it off, potentially reducing the long-term return. Nevertheless, the outcome has so far outperformed a savings account, where that $1,000.00 might generate several bucks yearly, assuming a 2 percent rate. As for the risks, they run back to our consistent theme of investor threats: loan overextension along with defaults.

While you can delimit this possibility by observing the risk ratings provided by Lending Club, it is important to recall how the COVID outbreak affected jobs – especially in the low-wage market. The United

States experienced a radical bottoming out of the labor force due to draconian shutdowns in several large states. Rules banning gatherings over a certain size or scuttling entire business models left many folks without work; and destroyed smaller businesses. Should a person suffer job loss due to another outbreak or the response to such a thing, they might struggle to repay loans, thus compromising that juicy investment. Hopefully everyone will be fine, yet said possibilities make loan investing a poor idea, at least for sizable parts of the portfolio. Perhaps a small position for larger income streams is warranted, but otherwise be careful about relying on the method for the Immortal Investor front. Annuities Another item which gets thrown around fervently is the concept of investing in annuities for retirement to command a fixed income in the future. Broadly speaking, these guys are vehicles which pay out a steady chunk of cash for so many years. Immediate annuities work something like this: a 65-year old man invests $100,000 in the program, and gets $494.00 a month for the remainder of his life. A woman at the same age would get a little bit less at $469.00 because females have higher life expectancy.[68] On the flip side, a person could invest in a longevity annuity at the same age of 65, which grants a higher rate monthly (such as $1673.00), but only after you reach an older age, such as 80.[69] Thanks to the bottoming out of traditional pension programs over the last forty years in the United States, annuities seem like a good way to supplement fixed income sources for retirees such as Social Security. Unfortunately, there are plenty of red flags built into the concept, and indeed financial sinkholes galore. The first debate surrounds matters of stability. One of my initial encounters with the subject of annuities came on a financial talk show, where the proponent kept rhapsodizing the value of these investment vehicles, “Backed by the strength and resolve of a $165 billion dollar insurance industry.” He was dazed with zeal, or at least committed to making others feel the same way. The constant appeals to “$165 billion” sounded like an absolute warning sign for someone familiar with economic fluctuations like the 2008 collapse, and the lies of politicians. Unsurprisingly, the next guest on the show proceeded to shred his predecessor’s message, calling annuities, “maximum risk bombs.” We can parse the reality by looking at things in context. Seldom do you find examples of companies willing to pay large and steady checks

to people without substantial risk. Trading stocks obviously carries with it plenty, and real estate or Bitcoin also have significant downside potential. While some bonds exist which spit out large interest coupons, they tend to be in the higher risk, “junk bond” category. The simple enough reason is that any secure and steady way of making money would quickly attract EVERYONE, swiftly inflating its value and desirability. It should thus come as no surprise that annuities carry with them considerable peril. To start, you are paying into something on the basis of a certain span for future payments, say 20 years. The only way a firm can make money off such products is by charging above and beyond the maximum payout total, or by banking on people dying before collecting the whole pot. In addition, variable annuities feature expensive “surrender charges” in the event you must withdraw money during a specific term.[70] [71] The main advantage of an annuity lies in its protective element. Instead of having to rely on a wishy-washy stock account or savings, you can simply enjoy the small check each month and plan around those payments in the days of retirement. While I can see the benefits inherent to the program, the risk of being scammed by an insurance company – or seeing your money lost upon death, makes it a poor option. The Different Hedge For as much as various stock alternatives have been presented to guard against inflation, they usually take the shape of physical currency possessions in a bank or investment accounts on a digital basis. These are all respectable options, yet they don’t help if you are separated from the market desiring them, or in the event infrastructure breaks down. Suppose a food shortage breaks out, as many expect[72] one will; how useful is whatever currency going to be when you are starving to death? Most people refuse to entertain such an example because they are accustomed to urban or suburban life, where a nasty hot dog stand or Costco can be found at the flick of a wrist. The extent to which they keep stores for an emergency is limited to frozen or canned food – and even that in small proportions. They are the ones sprinting to the warehouse when word of a pandemic hits so the fancy TP is not in short supply. Never forward-thinking, and even less willing to acknowledge the fact. Your goal as an Immortal Investor should be to NOT compete with those types. It’s great that they love shopping, but that doesn’t work in an extreme-tier situation. Consequently, better approaches are available.

Land is crucially important to a sensible investing strategy, if only as a hedge. It allows one to grow food, live on in a shelter or camper if necessary, and even gain access to water. All such elements are not available simply by virtue of purchasing stocks. The catch is that cultivation of the earth requires work, and folks have a tendency of shying away when presented with the prospect. Our first approach should consider the size question. Having a plot is good, but will it be large enough to actually grow anything? Think about your average daily consumption of calories; even if it’s on the lower side, several beds of carrots is unlikely to provide all the staples necessary, and certainly not with reliable fashion. We have to factor in weather, creepy crawlies, soil quality, and any number of other aspects. This means the Immortal Investor is wise to look at options incorporating at least 2-5 acres of decent pasture land, with a focus on the local climate and quality of soil.[73] [74] You can buy a soil testing kit for these purposes. Try taking a shovel to the dirt as well. This will verify whether the terrain is filled with rocks or shale, which can be difficult to grow on or clear for a farm. Be careful of an area with many trees; while gardens can be planted in the woods, the process is more complicated.[75] A substantial plot of cleared acreage will allow for crop rotation, which prevents damage to the soil from overharvesting. Here are some good titles on the subject: Start Your Farm: The Authoritative Guide to Becoming a Sustainable 21st Century Farmer (Forrest Pritchard) Mini Farming: Self-Sufficiency on 1/4 Acre (Brent L. Markham) Alternatively, as not everyone may be able to purchase land, or at least at the very moment, there are the angles of hydroponics and aquaponics. For those who don’t know, hydroponics is a method of planting which relies heavily on water-based gardens that can be kept inside and are less at risk for weather factors. They also require a reduced amount of space, although obviously the harvest size is liable to be smaller. Aquaponics on the other hand provide garden growth by taking advantage of fish and their cultivation of the plants. Some good books to check out on the topic of indoor gardening include: Aquaponic Gardening: A Step-by-Step Guide to Raising Vegetables and Fish Together (Sylvia Bernstein) DIY Hydroponic Gardens: How to Design and Build an Inexpensive System for Growing Plants in Water (Tyler Baras)

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Permaculture in Pots: How to Grow Food in Small Urban Spaces (Juliet Kemp) In any case, be careful about using artificial means of production to speed up the process. A popular option in recent years has been indoor gardens promoted by the MiracleGro brand. These devices have great reviews, yet they rely on significant input from synthetic fertilizers, with MiracleGro as the obvious culprit. While no documented health risks exist, the track record of chemical companies is questionable, so alternative options like organic compost or animal recycled waste should be considered.

IV. Conclusion I hope this short tract has been useful to you in some way. Much as we place a high value on the hustle and bustle of modern life and financial pursuits, the concept of retirement can become so enervating as to impose great stress on average people, driving them to despair. This is primarily due to the way that investing is marketed, with a constant finger on the “Fear of Missing Out” button. Traditional value investors can even be caught up in this swill, feeling inadequate about their more conservative choices while other riskier growth options skyrocket for the heavens. Every contrary result signals doubt, and the talking heads broadcast their version of snide, pump and dump paranoia. It is precisely for these people that the Immortal Investor concept exists. Although it may be unwise to leave all investing to remote advisors, there is still the potential of deescalating what rage and terror is wrapped up in the fundamental pursuit of wealth. The key element remains a sincere commitment to comprehending the rules of the market which hold true, despite passage of time or legislation. Folks who strive to reach this level of calm can achieve not merely financial triumph, but still more the inner peace brought through general tranquility. That is a noble goal, regardless of how much fame accompanies the success. Now, in the event the Immortal Investor principles bring you to a position of great prominence, always be wary of the responsibility entailed by such a placement. One has but to switch on the television set or streaming device to witness a deluge of atrocious information being peddled by creatures of the public square, often for nothing more than their own ego. These individuals are granted the ability to influence others, but proceed to do so in the most repulsive ways, losing sight of the positivity and level-headedness that can help create a better world. It will be up to those who value truth and honor to use their standing towards the betterment of one and all, educating and mentoring the next generation. On a more technical note, given the nature of the economy and current world events, there may well be information worthy of adding to this title, whether in the short-term or over time. I consider myself a learner first and foremost, and thus ideas on topics which might

strengthen the text are graciously welcomed. Feel free to contact me at [email protected] with any suggestions, and let this book be a continuous trove of growth and knowledge. Be well, and don’t panic. Stocks usually go back up.

Appendix: Fund and Stock Ideas NOTE: The dividend percentages and fee figures may fluctuate over time based on share price and management company decisions. Tech Funds FTEC (0.08) 0.45 percent dividend QQQ (0.20) 0.52 percent dividend QQQM (0.15) Healthcare and Pharmaceuticals FHLC (0.08) 1.36 percent dividend yield XLV (0.13) 2.27 percent dividend yield XPH (0.35) 0.59 percent dividend yield Municipal Bond Funds NVG (2.49) 11.31 percent dividend yield PFMIX (0.51) 2.49 percent dividend yield Retail Funds FDIS (0.08) 0.77 percent dividend XRT (0.35) 1.23 percent dividend REITs and REIT Funds O (Realty Income Corporation) 4.65 percent dividend NNN (National Retail Properties) 5.02 percent dividend OHI (Omega Healthcare Investors) 7.31 percent dividend USRT (0.08) 3.18 percent dividend VNQ (0.12) 3.49 percent dividend XLRE (0.13) 3.23 percent dividend Higher Yield Dividends VYM (0.06) 3.62 percent dividend SCHD (0.06) 3.41 percent dividend SNP 500 Funds SPLG (0.03) 1.78 percent dividend SPYG (0.04) 1.08 percent dividend Emerging markets EEM (0.68) 1.86 percent dividend VWO (0.10) 3.3 percent dividend SPEM (0.11) 3.1 percent dividend

XSOE (0.32) 2.0 percent dividend Dividend Growth Stocks AAPL (Apple) 0.63 percent dividend AWK (American Water Works) 1.4 percent dividend T (AT&T) 7.23 percent dividend CLX (Clorox) 2.1 percent dividend COST (Costco) 0.8 percent dividend HD (Home Depot) 2.3 percent dividend ITW (Illinois Tool Works) 2.3 percent dividend KR (Kroger) 2.2 percent dividend MSFT (Microsoft) 1.1 percent dividend SHW (Sherwin-Williams) 0.8 percent dividend VZ (Verizon) 4.26 percent dividend

About the Author Martin Goldberg is a social scientist and educator who has also authored the books Total Invincibility, How To Suck At Business, and Social Warrior. He blogs at www.martingoldberg.net and is active elsewhere in the digital realm. When not putting pen to the word processor, he can be found working outdoors and developing an organic garden, somewhere in the South.

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