“I Like Investments I Can Touch”
Real estate. Land. Gold. Trading cards. Beanie Babies. Weird memorabilia that no one else but you cares about (like Joe Frazier’s jockstrap that sold for $10k). I get a lot of questions about stuff like this. The idea is “I can touch these things, but I can’t touch the stock market” (please don’t touch the jockstrap). I don’t have a problem with that idea, but I do have some questions-
-
- How does this fit your financial plan? If you plan to rent out the farm, great! Let’s factor that in. If you are just hoping “number go up”, that is gambling (again, fine, but let’s not make that part of your plan).
-
- What is your exit plan? When do you plan to sell? Do you plan to sell at all? If not, how does this affect your estate plan? Can realistically manage the investment when your health or mental acuity starts to slide (this is especially relevant for real estate)?
-
- How does this affect your liquidity? If you have an ample emergency fund and other liquid investments, totally fine.
-
- How do you plan to spend it? You may have land, but the barista at Starbucks won’t accept a shovel full of dirt as payment.
Lastly, are you sure you can’t touch your stocks? A few examples-
-
- That iPhone in your hand? Apple.
-
- That latte that made you late for work? Starbucks.
-
- The conspiracy theory your uncle shared on social media? Meta.
-
- The murder documentary last night? Netflix.
-
- That package on your doorstep you had to hide from your spouse? Amazon.
-
- The douchebag that cut you off in the Cybertruck? Tesla.
-
- The deodorant you hopefully put on this morning? Procter & Gamble.
-
- The vacation you just booked? Boeing, Delta, and MGM.
-
- The credit card you swore you were gonna pay off last month? Visa.
-
- The company I use to send out these newsletters? Intuit (via Mailchimp).
-
- The “quick trip” to Target that cost $200? Target.
-
- That Tylenol you reached for after the Target bill? Johnson & Johnson.
-
- Did your kids make you watch Frozen for the thousandth time? Disney.
-
- The lawn chairs out on your patio? Home Depot.
You get the idea. You don’t just touch the stock market. You live in it. It affects you, and you affect it. It is one of the many tools we use to Make Life Your Beach. Don’t underestimate it.
