A good sign. Lots of Exponential Investor readers have already registered for next week’s Boost Your Income Masterclass. Have you? If not, go here now and find out what it’s all about.
I think I’ve struck a nerve with this one. Or perhaps the markets have done the work for me. Let me tell you a story that demonstrates what I mean.
In the spring of 2010 I sat down with a fairly highly respected former fund manager and investment pundit. He told me, with absolute certainty, that interest rates would go back up to “normal” levels within months.
It made sense at the time. Interest rates had been dropped as an emergency. But it turned out to be a long emergency. A really long one. We’re still in it. And there’s no end in sight. After a small uptick in interest rates in the last few years, rates are now falling.
That causes problems. It warps the economy. Warps people’s relationship with money. Blows bubbles up left right and centre.
And delivers the economic equivalent of a kick in the teeth for anyone seeking to generate income. Which is why I’m delighted so many people have chosen to take matters into their own hands. That’s what our Boost Your Income Masterclass is all about. We want to show you that there is a better way to generate income from your investments.
An important caveat. If you sign up you’ll discover a technique you can use to boost your investment income. Exactly how much you can make depends entirely on how much you have to invest.
And this is an investment strategy. It requires startup capital. The more you have, the more income you’ll be able to generate. As with any form of investing it involves taking risks.
I say that because I regularly receive questions from readers (to firstname.lastname@example.org) that say something like, “I don’t have a lot of cash free right now, what shall I invest in?” or “I’m still working to clear my debts, what strategy should I use?”
My answer is always the same. Don’t invest at all! Save more. Save hard. You’re not ready to start investing yet. This answer does my business no good, given our sole form of income is selling investment advice and research. But it helps me sleep at night.
Investing is about taking money you don’t need now and trying to turn it into something more. That requires a pot of capital you’re willing to risk. That doesn’t mean you want to lose it all at the racetrack. But if you’d find yourself out on the street if your investment went bad, then you’re investing too much money.
Start slow. Start scared. Save, save, save. Build things up.
Then, you have a choice. You can try and grow the pot by making capital gains. Or you can simply seek to turn it into a decent income – which is what next week’s masterclass is all about.
As one reader who has already signed up for the masterclass put it, “I would definitely upgrade my retirement plans and maybe have an extra car in the garage…”
That’s the right attitude. Personally I wouldn’t have an extra car in the garage. I’d buy another road bike. And maybe one for my wife (with a motor so she can ride in the mountains with me).
But that’s just me. How you spend the extra income is no business of mine. I’m content to simply show you how it’s done, with the help of a couple of million-pound money managers I’ve recruited especially for the job.
Boosting your investment income can boost your standard of living. It’s a life upgrade. A retirement upgrade, if that’s your goal.
Moving on. Gold hit another all-time high – in pounds – on Tuesday. That’s largely a function of the fact the pound hit a 34-year low against the dollar.
And that’s why you own gold. And silver, which is catching up with gold after a long period in which it lagged. Precious metals protect you against the value of paper currency collapsing. Sometimes you need that protection more than others. Now is one such time.
I’ll make a prediction. The pound hasn’t yet found the bottom. With an election looming – during which political parties will fall over themselves to promise the earth with no thought for how we pay for it – and Britain’s unclear future trading relationship with the EU… there’s plenty of uncertainty around.
The worst case scenario? That depends on who you are. If you’re trying to generate income, try this. Rates drop further. Bank deposits and bonds yield next to nothing. The pound falls. Inflation picks up. It’s hard to generate a yield, and what you can generate loses value by the day.
That’s personally why I own gold. And why I’ve asked my team to host the Boost Your Income Masterclass next week. There are problems looming on the horizon. I’m trying to share potential solutions with you…
Publisher, Exponential Investor