EP 39 | WAITING IS NOT A VIRTUE

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ANDREW LANOIE

On this episode of The Impatient Investor, Andrew talks about why you should not wait for the markets to settle down to move forward with investing. Instead, it would be wise to turn your attention to investing in multifamily housing, which is stable and growing.

“Investors who are waiting for the markets to settle down are missing out on moving forward with their schedule and achieving financial freedom.”

Full Transcription:

A Colorado man recently made the local news for missing out on a lottery payout because he failed to claim the prize by the deadline. Peter Bailey played the lottery in April and had up to six months to redeem his winning ticket for $1,500. He missed the deadline by three days and as required by Colorado law, the unclaimed money was distributed to various state wildlife and educational agencies.

$1,500 isn’t exactly chump change. But if you think missing out on $1,500 stings, what about missing out on a $20.5 million payout? Well, that’s exactly what happened to one person in Arizona last year. The winning ticket was sold on June 5th in Goodyear, Arizona, and the winner had up to 180 days to claim the prize, that deadline came and went, and no one showed up to claim his or her prize. Nobody knows if the owner of the ticket ever realized they missed out on a fortune, but ignorance is probably bliss in this case.

Sitting on the sidelines and missing out on a lottery prize, not only sting psychologically, but the hard luck owner of the ticket also misses out on money that perhaps could have let them retire. Spend more time with their families, donate to good causes, invest, etc., etc. You get the idea. I’m sure you can think of a million ways to spend $20 million.

In the world of investing. There are plenty of investors that miss out by sitting on their hands, just like the lottery ticket holder, who waits too long to claim their prize. Right now, these investors have all the excuses in the world for sidelining their money. There’s too much uncertainty surrounding COVID. What if we go back to lockdowns, the presidential election isn’t settled? The timing’s not right. Timing the market is not a winning strategy. It’s speculative and no better than gambling. Guessing on market shifts and moving money in and out to profit from upswings and minimizing losses from downturns is a recipe for losing money. Nobody’s ever made money from doing that. This is evidenced by the fact that average retail investors do worse than inflation when playing the market. Waiting is not a virtue.

The myth many investors claim too is that weighting is harmless and that not making a decision won’t have any other repercussions. This could not be further from the truth. Professional poker players say that sometimes not making a choice can have just as much impact as actively making one. One of those professional poker players, Annie Duke had this to say about the choice, not to make a choice.

“There is no such thing as not deciding. A decision to wait and see while you gather more information is an active decision to with the status quo and a decision to defer any changes to the status quo is a decision to stay the strategic course you are already on.”

Investors who choose to do nothing are actively deciding to stay the strategic course they’re on. What is that strategic course? Choosing to miss out on opportunities to proactively grow money. This is a strategic course, whether or not investors believe it. In economic terms, not only are the sideline sitters losing money as their investment capital is eroded by inflation, but there is also an opportunity cost to not putting this capital to productive use. I am not advocating diving back in an unstable stock market. I’m advocating against doing nothing because there are investment assets out there that you can commit your capital to right now that are insulated from market volatility and that can offer recession-resistant income and growth.

The problem for many investors is they think the stock market is the only way to get back into the game and just seems too daunting. And that’s what stopping many investors from getting back on the road to financial freedom. What many investors who are suffering from analysis paralysis don’t realize is, there are other roads to financial freedom. Maybe it’s time to pivot, consider other investments. It’s better to adjust than to wait.

If your goal is to generate long-term wealth, then you should consider adjusting your asset allocations to assets that will help you accomplish your goal. That’s why you should consider alternative assets that savvy institutional and individual investors have long turned to for building wealth. Assets insulated from Wall Street volatility that generates stable, consistent income and growth even in uncertain times like the one we’re living through now. Alternative assets like real estate, private equity, commodities, precious metals and venture capital behave differently than traditional stocks that fluctuate with the broader markets and economic movements.

There are select alternative assets that are not only recession-resistant but thrive in one. One of the best asset classes is affordable housing and specifically the manufactured home sector. How do we know that manufactured housing thrives in a recession? During the pandemic, even as multifamily saw a rise in vacancies and a decrease in rents, the opposite was true for manufactured housing that saw vacancies decrease and rents increase. Investors who are waiting for the markets to settle down are missing out on moving forward with their schedule and achieving financial freedom.

Don’t wait for the broader markets to settle down. Pivot to stable markets like the market for affordable housing in the manufactured housing space where the income and appreciation are not only stable during a recession, but they grow. The bottom line don’t do nothing. For more information, go to www.stoptradinghours.com.

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Episode 39