Once you have a surplus, you need to put it to
work in productive assets; things that throw off passive income that comes in all hours of the day without you having to sell your time.
The idea goes as follows: Would you rather have an emergency fund invested in cash (current yield maybe 1 %) and forego an expected equity expected return of, let's say, 7 % or keep your
investments in productive assets and use debt to finance the occasional emergency?
In other words, I view our entire portfolio as one giant emergency fund
invested in productive assets (mostly equity index funds) and I don't see the need for keeping a separate bucket of money in low - risk assets.
In order to attain a $ 6,500 monthly pre-tax retirement income, Sam would have to work 30 years to 65 and invest
in productive assets.
In order to attain a $ 6,500 monthly pre-tax retirement income, Sam would have to work 30 years to 65 and invest
in productive assets.
Businesses will not receive any material incentives to increase their investments
in productive assets.
In Berkshire Hathaway 2011 letter, Buffet said that: My own preference — and you knew this was coming — is our third category: investment
in productive assets, whether businesses, farms, or real...