Then Ill take you through the steps of stockpiling businesses that will make

Then ill take you through the steps of stockpiling

This preview shows page 32 - 36 out of 263 pages.

Then I’ll take you through the steps of stockpiling businesses that will make you rich. TAKEAWAYS AND ACTION ITEMS To get rich, learn to value companies and build a portfolio of businesses at a discount to their true value. Follow the Stockpiling Strategy:
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1. Determine the true (intrinsic) value of a business and buy stocks in those companies when they go on sale. 2. Continue to stockpile as long as you can buy them on sale. 3. Follow the 10-10 rule and don’t own a business for ten minutes that you wouldn’t own for ten years. 4. Make a significant profit by selling your businesses at or above their true value. Only buy businesses that you can understand and have meaning for you. Find businesses that are right for you by taking my investor profile test at . This is a cool personal assessment tool to quickly review your investments and find instant savings. It is a step-by-step questionnaire designed to help you better manage your money, and best of all, it’s free. * BusinessWeek , July 5, 1999. * 2006 Yahoo! Small Business and Harris Interactive survey.
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I MUTUAL FUND INVESTING MAKES NO SENSE A long habit of not thinking a thing wrong gives it a superficial appearance of being right . —T HOMAS P AINE f what happened to your retirement money in the last couple of years wasn’t enough to prove to you the futility of the mutual fund industry, let me state the fact: You have been systematically brainwashed out of your rightful retirement by the very system into which you are putting your trust. The 401(k) you’re using to stockpile your excess capital or the managed IRA you’re pouring your retirement money into was set up for the benefit of other people—not you. They are not catering to your retirement out of altruistic concerns. Like sheep, you are being cared for only so you can be sheared. The main beneficiaries of the investments in your retirement plans are the very people who created these funds: the fund administrators and managers. They’ve set up the system so that, in the end, they’ll wind up with half to two-thirds of your money. You didn’t know that, did you? You thought they were only taking a little piece. Not so. (Hang tight; I’ll explain how this happens shortly.) These fund managers are in the mutual fund business because it makes them rich without having to be talented. They either don’t have the skill set necessary to successfully stockpile businesses or they don’t have the luxury of time to wait for a great opportunity to stockpile. Either way, they are not business stockpilers. Yet you give them your capital—your
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hard-earned money. And they, in turn, eviscerate that pile of money. YOU DON’T GET WHAT YOU PAY FOR Your 401(k) fund managers and administrators are charging you, on average, 25 percent per year of your expected Return on Investment.
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  • Spring '20
  • Warren Buffett

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