A wise man once said, If a man’s wealth be measured in grains of rice, he could hold all the riches of the world in his hands. Okay, so that man was an idiot. He was also my Uncle Larry, and he died penniless – unless you count the 850 boxes of Minute Rice found in his basement after his funeral.
Thankfully, I did not follow Uncle Larry’s investment approach, though I am enjoying the Minute Rice he left us. In fact, I have accumulated a large amount of wealth over my lifetime – almost as much as I have lost. If you’re concerned you may not have saved enough to comfortably retire before the age of 75, you’re not alone. You’re still probably screwed, but at least you’ll have company.
Let me share a few pearls of wisdom. First, whatever you do, and you might want to get a pen to write this down: NEVER HAVE KIDS! They are insanely expensive. The ROI on progeny is like a buying a bond – it takes decades to see a profit – if you’re lucky. According to recent studies I just made up, the cost of raising a child through college is $4.9 million – even more if you indulge in orthodontia for their crooked teeth. Okay, maybe I’m overshooting my cost projections slightly. My point is, kids will drain your retirement savings.
Don’t get me wrong – I love my kids – almost 70% of the time. I’m just saying, think of all you could do with the mega-bucks you’d save by being a little more conscientious about birth control. You could buy a small island off the coast of Greece (other than Mykonos or Santorini – I checked – they are way out of your price range). However, if you glibly choose to ignore my advice and decide to start a family anyway, don’t say I didn’t warn you.
If you’re going to get into the stock market, you need to know four words: BUY LOW. SELL HIGH. For years, due to my mild dyslexia, I got this totally backwards. Let me tell you, THAT was a costly mistake!
Here’s an example of how this works: Let’s say – hypothetically – you put half of your nest egg into a bleeding edge tech stock you don’t fully understand but which your co-worker Rick, who drives a new Beamer, swears can’t miss. Perhaps you buy 10,000 shares at $45 a share. Now, imagine – again, very hypothetically – that the stock price starts to slide a smidge, down to $32 a share …. then $24… then $15…. Be patient. The key is to think long term. Stocks usually bounce back.
Continue to resist the urge to cut your losses as the stock hypothetically continues its downward death spiral to $9 a share, then $4, and finally $1.70 a share.
Dude! What are you waiting for? SELL, for God’s sake! Do you want a total loss!!!!???!!! Dump the damn stock!
Then, watch with a mild case of seller’s remorse as your former very hypothetical tech company gets acquired by Microsoft. One year later shares are worth $130 each. This painful disastrous story really happened – um, to a buddy of mine. You don’t know him.
The takeaway is to invest in large growth-oriented companies with robust earnings potential. That’s why I strongly suggest you buy as much Apple, Google and Amazon stock as you can – no later than the year 2004. If you follow my advice, trust me, you’ll be fine. Santorini might be in your price range after all.
I wrote the preceding paragraph in July 2003. If you waited until 2019, to finally read this column, don’t blame me for your dawdling, pal. Maybe you can locate the DeLorean from Back to the Future and go back in time. Let me know how that works out.
Another prudent investment vehicle I strongly advise my clients to acquire is gold. It’s a great hedge against inflation and the vicissitudes of an unstable market. The current cost of gold is $1.50 an ounce. No, wait, my bad. That was the price when Garfield was president. The current price turns out to be a tad higher – hmm, it’s currently at $1,303.95 an ounce. You should’ve gotten in while Garfield was in office or at the very latest by FDR. Fortunately, I currently own several ounces of gold. Unfortunately, unless I decide to have my molars extracted, it’s not a very liquid asset.
Another investment strategy to consider is real estate. Home values always go up and up (disclaimer: except when they go down and down). And if you spend a little more to remodel your home, its resale value increases even more. No worries if you gutted your retirement fund in the process of remodeling.
Experts estimate that for every $10,000 you pay the contractors for that stylish kitchen or the Grandparents addition (that your college graduate now lives in for free), you may actually see a $1,000 increase in the resale value when you sell it in 25 years. In the interim, living on TV dinners and turning off the heat during winter to make ends meet is a small price to pay for financial security in your old age, when you’ll be in too poor health to travel (mainly due to years of eating those terrible TV dinners).
Finally, if you have chosen to ignore all my outstanding fiscal counsel, there is one last technique you might consider: Marry a millionaire (see film How to Marry a Millionaire starring Marilyn Monroe for a step-by-step guide). While at first this may seem a bit drastic – especially if you’re currently happily married – trust me. Your spouse will jump at the idea after all the money you lost in the stock market. She may even help you with your online dating profile. Rumor has it that Brad and Angelina are both available.
Good luck, and don’t forget, BUY HIGH. SELL LOW. No, wait. I think I might have that backwards. I’ll get back to you on that.
That’s the view from the bleachers. Perhaps I’m off base.
Check out my latest humor book: YOU’RE GROUNDED FOR LIFE: Misguided Parenting Strategies That Sounded Good at the Time
© Tim Jones, View from the Bleachers 2019