{"id":21217,"date":"2025-09-28T02:03:12","date_gmt":"2025-09-28T02:03:12","guid":{"rendered":"https:\/\/finderica.com\/?p=21217"},"modified":"2025-09-28T02:03:12","modified_gmt":"2025-09-28T02:03:12","slug":"the-surest-bet-to-reach-your-investing-goals","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=21217","title":{"rendered":"The Surest Bet to Reach Your Investing Goals"},"content":{"rendered":"
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Editor\u2019s Note:<\/strong> Chief Investment Strategist Alexander Green\u2019s approach to building wealth is refreshingly simple.<\/p>\n

He often says, \u201cSave as much as you can, starting as soon as you can, and earn as much as you can for as long as you can.\u201d<\/p>\n

Below, Alex debunks some common investing myths and shares the truth about how to achieve financial independence for yourself and your family.<\/p>\n

For more insights from Alex, check out our sister e-letter, Liberty Through Wealth<\/a><\/em>.<\/p>\n

\u2013 James Ogletree, Senior Managing Editor<\/p>\n

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Thirty years ago, the IRS counted 1.6 million Americans with a net worth of $1 million or more.<\/p>\n

UBS \u2013 using data from several sources \u2013 put the number at 23.8 million in 2024, a nearly 15-fold increase.<\/p>\n

What accounts for the surging number of everyday Americans with a seven-figure net worth, once the domain of CEOs and celebrities?<\/p>\n

Three major factors: rising home values, rising stock prices, and continual inflation.<\/p>\n

Let\u2019s take a closer look at each and determine what you need to do \u2013 if you haven\u2019t done it already \u2013 to become financially independent.<\/p>\n

Let\u2019s start with the basics\u2026<\/p>\n

I received only one piece of investment advice from my dad my whole life.<\/p>\n

When I was a 22-year-old, he said, \u201cSon, if you plan to stay in that town, you should buy a house rather than renting.\u201d<\/p>\n

It makes no sense to throw money away on rent \u2013 which is building equity for your landlord rather than you \u2013 unless your job (or your lifestyle) requires you to move frequently.<\/p>\n

That\u2019s what most U.S. millionaires have done. Overwhelmingly, they are homeowners.<\/p>\n

They benefited from rising home prices, while renters found housing increasingly unaffordable, especially once rates started going up a few years ago.<\/p>\n

The other thing most millionaire households did was invest in stocks.<\/p>\n

No other asset class has outperformed a diversified portfolio of equities.<\/p>\n

That means those who avoided risk \u2013 by investing solely in money markets, CDs and bonds \u2013 earned much lower returns.<\/p>\n

Sure, with little to no volatility they had lots of restful nights. But they may not have a restful retirement if the money starts to run low.<\/p>\n

Those who bought a home, invested regularly in stocks \u2013 in a 401(k) or elsewhere \u2013 and held onto them for 20 years or more almost certainly have a million-dollar net worth\u2026 or are well on their way.<\/p>\n

If you did this, you probably feel a sense of pride that with work, discipline, and sacrifice you secured your family\u2019s financial future.<\/p>\n

The Washington Post<\/em> sees it differently.<\/p>\n

They recently accused millionaires \u2013 in an article, not an editorial \u2013 of widening \u201cthe gulf between rich and poor.\u201d<\/p>\n

There was no mention of how some folks don\u2019t work, don\u2019t save, don\u2019t invest, or won\u2019t stop spending.<\/p>\n

That would undermine the victimhood narrative. (At the Post<\/em>, personal responsibility is a forbidden subject.)<\/p>\n

But here\u2019s the rub: a million dollars isn\u2019t what it used to be.<\/p>\n

When I was growing up, the word \u201cmillionaire\u201d was shorthand for rich.<\/p>\n

Today it\u2019s a nice, round number. But it\u2019s also usually a point on a longer journey rather than a destination.<\/p>\n

That\u2019s partly due to inflation. It takes $2.1 million today to equal $1 million in 1995, according to the U.S. Bureau of Labor Statistics.<\/p>\n

Most Americans recognize that a million dollars \u2013 while it certainly makes life more comfortable \u2013 will not provide a life of leisure.<\/p>\n

According to Charles Schwab\u2019s annual nationwide survey of 401(k) plan participants, $1.6 million is now the magic number.<\/p>\n

That\u2019s how much most feel you need to have to retire. Yet even that amount won\u2019t provide a lavish retirement.<\/p>\n

Invest $1.6 million in ten-year Treasury bonds and you will earn $67,200 a year at today\u2019s rates \u2013 or $4,200 a month after federal and state taxes.<\/p>\n

You could put the same amount into an S&P 500 index fund and \u2013 if it generates its long-term average return \u2013 it would earn about $160,000, or $9,625 a month after federal and state capital gains taxes.<\/p>\n

After taxes? Recall that you have to sell part of your holdings before you can spend them.<\/p>\n

And those capital gains rates \u2013 even long-term capital gains rates \u2013 are pesky.<\/p>\n

Of course, the vast majority of Americans don\u2019t think the rich pay their fair share.<\/p>\n

So look forward to getting fleeced and denigrated year after year. (Welcome to the club!)<\/p>\n

Of course, you could spend more if you dipped into your $1.6 million in capital.<\/p>\n

But then your future returns would be lower and \u2013 depending on your spending habits \u2013 you could run through the entire principal amount, especially with people living longer.<\/p>\n

Unfortunately, the investment return on zero is always zero.<\/p>\n

That means the surest bet is to save as much as you can, starting as soon as you can, and earn as much as you can for as long as you can.<\/p>\n

This is the safe way to reach your financial goals and to make sure your dependents always have enough.<\/p>\n<\/p><\/div>\n