Category Archives: Investing – Lizard Brain

Investing for income – 2018 | The Adviser Industry is wrong.

Over the last thirty  years or so I’ve managed to confirm a  couple of things about investing and making your money work hard through investing.

There is no doubt that there are several investment options that make money and many that don’t and investing for income is one of the things that works and will make a poor performing portfolio zing with life.

My views have caused a little conflict with industry players and the invest for income or growth debate. My conclusion is most advisers and wealth managers get this completely wrong and the evidence is starting to become overwhelming against many advisers.

Investing for income is like having a machine inside your bank account churning out fivers on demand and whenever you need and without having to work for them.

Income that’s passive is the gold that most businesses look for and do their best to achieve.

Imagine for one minute, your retirement; with a portfolio of shares and Exchange Traded funds (ETF) that have been working for YOU over the last ten or twenty years. It’s likely that you’d have seen some increases in capital value (growth) which is good news, however when comparing that with the income you’ll note how much better off you could be with this strategy.

Growth funds you see are just that. Growth. But in order to survive, to pay bills you need income. Income is that tangible thing that flows into your bank each month or quarter. Income that doesn’t stop when the markets wobble or flatten.  In business terms ‘you can’t pay a gas bill with your balance sheet or share price, you can only do that with income.’

Traditionally, we invested in shares because of income. Capital value increases were the icing on the cake – something that would be nice to have. Income is something you should aim for.

Forget what your current adviser is telling you. They’re so wrong on this. Investing for income is the only way to go.

The evidence for this is supported by a number of ‘more erudite and knowledgeable’ than me people, one of which is Geraldine Weiss.

From Moneyweek…

Weiss felt that a stock should meet most (or ideally all) of seven key criteria before investors should consider buying it. They are: 1. Must be yielding more than its historical average dividend yield. 2. Must have raised dividends at a rate of at least 10% a year over the past 12 years. 3. Trading for less than double the value of net assets. 4. Trading at less than 20 times earnings. 5. Earnings are at least double dividends. 6. Debt is less than 50% of total market cap. 7. Financially stable and with a long enough track record to be considered a “blue chip”.

And from the Telegraph

Quite simply put. If you are not investing for income you are missing a trick and if haven’t been then it’s not to late start. With Pension Freedoms – this could be way to enjoy a good cash income in retirement and enjoy something to pass on to your kids – a proper tax free legacy.

When you’re ready to learn some more about this strategy then get in touch using the form below, you’ll be pleased you did.

 

 

Investing and Your Lizard Brain.

 

You need to know how this works in order to contain that bastard Lizard Brain that lives inside all of us and how it will damn you to a life of abject poverty if you keep acting on what it tells you.
The Lizard Brain is the primitive, limbic system that overrides a lot of our brain and our thinking. It is concerned about very little apart from mating, eating, running away from danger and sleeping. It seems it’s a hangover from when humans were, well Lizards.
It  plays tricks on you, when it smells danger it will make you run and hide, but it’s simple and it’s childish. It’ll look at the world and say “ struth, everyone else is doing it, must be safe”  – let’s put that in context.
Chickens and many other birds have the same brains. Squirrels also spring to mind.
Further on on in the development of brains we arrived at Dog brains, all of the above except they have the ability to run in packs and need to communicate so the brain needed to develop a bit more.

So now we have sleep, eat, shag and of course communicate and run away. From there human brains were developed and of course gave us the power of advanced communication and thinking skills but there is a problem, that bastard Lizard Brain.

The Lizard Brain – And Investing,
Most people decide to invest in the stock market when the world and his stupidity is also investing. “market high again” bleats on the news and the tabloid papers.

“Our fund is the largest in the UK” crow on the marketing messages – you interpret that as “well there must be hundreds of others who have invested it must be good” – like lemmings running toward a deep sea.
Lizard Brain thinks, everyone’s investing gotta be good, large fund with hundreds of other investors – gotta be good.
Facts are far too many large funds don’t perform and the worst time to invest is when the market reaches an all time high – only I doubt there are many advisers who will point that out, especially not when their income today will be directly affected by you not investing.

The same applies to your pensions and ISA’s, a large chunk of your funds should be held in cash and then you can utilise market timing to benefit your investments, and not an adviser’s pocket.

The Lizard Brain really is the nutter inside your head, it’s quite  mad. Every time you start something new it finds a way to tell you it’s a waste of time, it won’t work. Tries to intervene unless it’s about sex, food, or sleeping in which case it lets you get on with it. You must have noticed it even if you have not reacted to it.
Your Lizard Brain – the nutter will always tell you it won’t work, will find reasons not to go/do/say/learn and just want’s to keep you safe. No new stuff, no moving forward. One reason
Chickens have never taken over the world (have you ever seen the film Chicken Run – if not  you should).
Don’t forget you can always ‘borrow my brain’ to solve a problem quickly and you can do that here  or you can get on the list, it’s where I share my best stuff first, that’s below.

 

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