The past few years have seen some major developments across the globe that have reshaped our world and touched almost every part of our lives. You can almost mark the date when things started to change drastically across the globe.
January 20, 2020, is the date when everything changed. That was the date when the CDC reported the first laboratory-confirmed case of the 2019 Novel Coronavirus (i.e., COVID) in the U.S. Since that point, the world has never been the same.
Throughout our country and the world history, there have been distinct periods of significant technological and human advances along with social setbacks and developments, but the past few years, it seems like those advances, setbacks, and developments have evolved to levels never seen before.
Pre-COVID, how much did you hear about the following subjects: social distancing, remote work, crypto, FTX, meme stocks, NFTs, freelancing, the gig economy, supply constraints, high energy costs, inflation, wars, AI, interest rates, and the metaverse? Post-COVID, it seemed like all of these things snowballed.
As humans, we often repeat certain cycles in our lives and repeat the same habits and mistakes over and over again without adapting to the new reality. This has been particularly true in the face of our current “new reality,” which is almost like an alien landscape compared to just ten years ago.
The more things change, the more they stay the same…
As long as there are new realities, there will always be investors hoping to cash in on “the next big” thing in these realities. And as usual, most of these investors will end up being disappointed, just like most people who buy lottery tickets hoping to hit the big jackpot. In the past, there were dot-com and mortgage-backed securities busts. In the past few years, crypto, NFTs, the metaverse, and plant-based meats were all bandwagon investments that crashed and burned.
The more things change, the more they stay the same. Investors are always looking to hit a home run, somehow thinking they’ll be a “boss” or have some secret recipe nobody else has to beat Wall Street. The reality is that not even professionals beat Wall Street, so the chances of the average investor doing it are slim.
The truth is, when it comes to investing, everyone is trying to be an entrepreneur and be their own boss. But it can be challenging to actually put thought into investing and decide when and where to invest. What most investors end up doing is just going along with the crowd.
Think about your own investment goals…
Are you investing for the big win? You know, investing for a big windfall like the lottery?
Or are you investing to incrementally grow your net worth?
Are you investing to save up to start your own company?
My investment goal is simple…
My investment goal is simple, and it never changes, no matter what new realities are in play: I invest for income.
I invest for income to give me the freedom to do what I want when I want. Investing for income allows me to be paid like I have a job without actually having to go to a job. Instead of working for money, my money works for me. That’s why my podcast is called Investing for Freedom. It’s all about buying back your time with the right investments.
What type of investments can buy back your time?
When it comes to investments, don’t gamble on your freedom or the future. Speculative investments can set you back for years, digging yourself a hole that is impossible to get out of. For example, when you lose 50% of your portfolio, you’re going to need to gain back 100% just to get back to where you started. That’s because, after losing 50%, you have less to work with.
Playing from behind is not a good strategy for gaining back your freedom.
Instead of speculative investments, I seek out investments that generate passive income. Passive income investments in tried-and-true assets that can make me money even while I’m sleeping are the quickest and surest way to create, grow, and preserve capital and wealth. It’s how I or anyone else can retire early and enjoy freedom and the life we dream of while our bodies still cooperate.
What do I look for in a passive income investment?
- Private market assets insulated from Wall Street volatility (not offered on public markets like stocks).
- Tangible asset (commercial real estate or income-producing business).
- In-demand and an inflation buffer (an essential asset like housing, food, and energy that will always be in demand no matter the economic environment).
- Tax benefits (offering deductions like business deductions and depreciation not offered by traditional assets).
What are your investment goals for 2024?
If you’re chasing unicorns and not investing for income, perhaps it’s time to try something different. Instead of investing for a home run, consider investing for freedom.
To learn more, check out my Investing for Freedom Podcast.