Welcome to Part 8 of this running thread on America’s Great Reorganization. And thank you for sticking with me through it all.
Yesterday we talked about the collectivist approach to investing. That’s the “conventional” retirement planning model.
Retirement Inc. has pushed the collectivist approach for forty years now. It says we should all funnel our savings into various kinds of funds (mutual funds/index funds/exchange-traded funds) and then hold them inside of retirement accounts – 401(k)s and IRAs.
As we discussed, this model created distortions within our society… because it enabled a quasi-political agenda. Worse, the conventional approach strapped humanity to the hamster wheel. Here’s what I mean…
There are a plethora of rules that come attached to retirement accounts. Those rules work together to effectively put our money in jail. Once we lock our savings away in these accounts, we can’t touch it again until we retire without incurring heavy-handed penalties.
Of course, Retirement Inc. pitches its funds as “diversified” – because they own stocks in a wide range of industries. They say their diversification equals safety.
But notice how they only focus on one asset class. And it just happens to be the asset class that pays them fees year after year. Even when they recommend bonds – usually it’s through some bond fund trading in the stock market.
So Retirement Inc. wants us to give them total control over our money. We are to lock it away and trust them with our investments… and hope they “go up”.
I see this approach as incredibly fragile. The self-directed investor can do much better.
My philosophy is simple… Financial security first. Then financial independence.
I define financial security as the ability to weather any sudden change or emergency for an extended period of time… in relative comfort.
That way if you were to lose your primary source of income or have an emergency of some kind – you’re good. You’ll have the resources you need to handle the issue – without it disrupting your life.
For financial security, all we need to do is acquire high-quality assets across a range of asset classes.
We want to have a foundation of reserve assets. We also want to have assets that will generate compound returns for us, year after year. Then we want to invest in some alternative assets that provide us with resiliency in difficult times.
That’s true diversification.
Then for financial independence, all we need to do is acquire assets that produce their own income. We call this passive income.
This is how we put assets and income on the same team. Your assets provide you with income. When you want more income, you just acquire more assets. Then you have more of both.
So now it’s a balanced approach…
If you consistently buy assets that produce extra income, at some point your passive income will exceed your expenses. At that point you are financially independent.
Do you see how this is the direct path to “retirement”?
With Retirement Inc’s plan, we funnel our savings into funds inside of retirement accounts and we hope they go up in value. Then, when we retire, we sell those funds to produce income for ourselves.
So to get income with their approach, we have to sell our assets. Once they are gone, we are poorer. Keep at it and we’ll have to worry about running out of money.
I have to ask – if our goal is to have income in retirement… why don’t we simply create extra income streams in the first place?
That way we can retire sooner if we want to. We don’t have to wait until conventional retirement age.
Plus, we never have to sell anything if our assets are providing us with income. Which means we don’t have to get poorer in retirement.
I firmly believe this dynamic is the secret to true wealth and independence…
It has nothing to do with hitting it big on any one investment. It’s not about gambling or speculating. It’s not about the latest hot trend.
No, it’s about an intentional, comprehensive, well-designed system for creating financial security first… and then financial independence – by creating extra income streams.
And guess what?
We’re no longer talking about traditional retirement here. If you can work up to having passive monthly income that supports all your needs and wants…
Well, you can retire any time you want to. It doesn’t matter if you are 65 or 45. All you have to do is build up the income.
That’s the path to true financial independence. It’s the ticket off the hamster wheel.
And guess what?
This approach is more accessible than ever before today. The Great Reorganization is creating a golden path for the self-directed investor right now – as we speak.
We’re going to spend an hour talking about this dynamic at our webinar on Friday.
We’ll talk about each part of the process in detail. Financial security first… then financial independence.
And then, after we’ve covered the process, I’ll lay out an approach that anyone can use to create extra $3,450 in passive monthly income within just three years or less. Then you’ll be off to the races from there.
I’ve also committed to doing an unlimited Q&A session after our core presentation on Friday. Attendees will be able to submit questions anonymously, and I promise to answer all of them. No question is off limits.
So I invite you to take some time to join us on Friday afternoon. We’ll get started at 3:00 pm Eastern sharp. Please register in advance at: https://phoenician-league.lpages.co/webinar-oct24-int/.
See you there!
-Joe Withrow
P.S. We’re calling Friday’s event The New Rules of Money Webinar – the 4.5 Things You Need For Financial Freedom.
If you can join us, please register in advance as bandwidth is limited. You can do so right here.