The Key to a Peaceful Sleep? Smart Investing

A peaceful sleep.

It is, perhaps, the quintessential goal for many an investor.

You want to know you can go to bed and not lie awake for hours on end, fretting about putting your wealth at risk in the stock market to grow your nest egg or generate income from the money you’ve saved over the years.

Clearly, the world has given us many reasons to fret about our wealth over the last quarter century or so. We had the dot-com bust to begin the millennium, which saw the S&P lose nearly 50% of its value over two years. We had the Global Financial Crisis/Great Recession that pushed the S&P down nearly 53% between late 2007 and the spring of 2009.

We’ve seen European debt woes, as well as a surprise downgrade to US debt and fears of a double-dip recession that dropped the S&P by more 17% in short order, nearly pushing us into bear market territory in 2011.

Then along came the COVID-19 pandemic out of the blue to send stocks reeling by 20% in just two months in early 2020… only to be followed by an overly aggressive Federal Reserve interest-rate hike campaign that resulted in the S&P losing 25% between December 2021 and September 2022.

Four bear markets and a near miss—all within 20 years.

That’s not normal.

It is, instead, a sign of the times we’re living in.

A world that seemed increasingly peaceful in the 1980s and ’90s has become much more volatile financially, socially, and politically since the turn of the millennium.

For investors who were in the prime of their careers when the dot-com stocks crashed, the losses were frustrating but at least they still had another 20 years to go before retirement. They had time to make up lost ground.

Even those whose wealth plummeted in the Great Recession still had a decade to claw back some of their losses.

But today… well, losses are far more painful to accept.

We don’t have years and years to regain lost ground.

We have to invest today for wealth preservation and income as much as we do for growth.

That is the genesis of my Retirement Income Masterclass… which is happening this Saturday, December 7.

The portfolio I’m building for this class is designed with my grandmother in mind. She never had much wealth. In her retirement, she lived on a fixed-income of Social Security and a tiny pension she earned as a purchase agent for a chemical company in the 1970s and ’80s.

She and my grandfather raised me, so I saw intimately the challenges of affording life in retirement—the need to earn passive income, yet also protect wealth from erosion due to market and economic crises.

So, I set out to build here in 2024 the kind of income-rich, safety-focused portfolio I wish I could have told my grandmother about in the mid-1980s, as she and my grandfather began moving into their retirement years.

By locking in these investments now, we have the opportunity to generate annual income of 7.2%.

Let me put that number into a broad context: Over the last century or so, the S&P 500 has generated an average annual return of 10.16%, when including reinvested dividends.

Right now, we’re able to collect from income alone more than 70% of the S&P’s historical, average annual return.

And we’re doing so in a fashion that’s safer than actually investing in the S&P—because we’re not relying on capital appreciation on stocks (although we can certainly expect some of that too—a welcome bonus on top of our 7.2%).

So, that’s what my upcoming Retirement Income Masterclass is all about… and I hope you’ll join me this Saturday.

The course is also specifically designed for the world right now—and for making money during the incoming Trump administration.

You see, right now, we have a really good opportunity to lock in nice yields—before inflation kicks off again, which I believe will happen as a result of Trump’s policies.

Now, please understand that this is not a political comment. It’s simply a statement of economic facts.

Let’s start with Trump’s plans to introduce tariffs. They are inflationary. There is no other way to say that.

The importer or the US company bringing goods into America—that’s the one that pays the tariff. And they’ll pass those on to consumers. So Trump’s tariffs will inevitably lead to higher prices in the US.

Tax cuts, if they happen, are also inflationary.

Tax cuts put more money in American pocketbooks and give us more spending power, which on the surface sounds really good. But when consumers have more money, stores raise prices. So, more money in the economy is one of the causes of inflation.

Moreover, tax cuts mean higher US debt. And more debt means higher debt servicing costs—more trouble for Uncle Sam.

Finally, if Trump manages to deport millions of immigrants, as his team hopes to do… That’s also hugely inflationary.

I’ve seen estimates that show immigrants (many of them undocumented) comprise as much as 80% of the ag labor force. The National Milk Producers Federation, for example, recently reported that 79% of America’s milk production is thanks to immigrant labor.

The US Pork Center of Excellence says, “many producers rely heavily on foreign-born labor, making up approximately 68% of farm personnel across the United States. Immigration is now a cornerstone of pork production.”

If much of the workforce is deported… Who’s going to process pigs into spare ribs and bacon?

Factories will shut down, or be forced to pay much higher wages to American workers… meaning food prices will be rising once again. Food inflation will be back with a bang.

So, for all these reasons… Now is the time we want to lock in some extra income for ourselves—so that we’re ahead of inflation in 2025 and beyond.

If you want to follow my lead… join me at my Retirement Income Masterclass this weekend.