Originally circulated on 13 November 2020
Aweh fellow Ruminants & Groupies in Lock Down Level 1
Aweh from day 230 of lock down – now level 1.
All of us on this list are corporate drones. Some of us, like me, are (ageing) lance corporals and some of you are privates and lieutenants with perhaps the odd captain, major or colonel here and there. There are no brigadiers and generals amongst this group. Some of the younger members of this group can aspire to be generals one day when one can have perks such as a designated parking bay right next to the private lift taking you straight to your large office without having to unexpectedly and awkwardly bump into any of the lower ranks. This cements your position in the dominance hierarchy. Statistically though your chances are slim.
If one can reach the generals rank you don’t need to think too hard about managing your money because there will be so much of it that you can hand this task over to the many well paid helpers who can deal with the vulgar business of money management. For a generous fee, of course. Having said that the tenure of generals can sometimes be somewhat insecure.
For the rest of us carefully managing our own money is the only defence we have to when our tenure as a corporate drone comes to an end as it surely must. It is also hard to predict when that day will come and the probability that it will be before 65 is fairly high.
30-35 years of contributions to a company pension fund is not going to be enough unless you are happy to restructure (i.e. downsize) your expenditure when you retire.
This means your own investments are vital. There are any number of helpers out there with gleaming head offices with private lifts and established brand names like Sanlam, Liberty, Momentum, Discovery etc.
This brings me to the story of the Gotrocks told originally by Warren Buffet and taken up by John Bogle the inventor of index funds and founder of Vanguard. http://johncbogle.com/wordpress/wp-content/uploads/2007/03/chapter%20one.pdf. This is worth reading.
The investment business is a giant scam. Most people think they can find managers who can outperform, but most people are wrong. So says Jack R. Meyer, former president of Harvard Management Company, the remarkably successful wizard who tripled the Harvard endowment fund from $8 billion to $27 billion.
The solution is simple low cost index funds. It’s not hard. Of course the helpers will advance any number of complex reasons why you need to use them and not index funds and that you are an ignorant fool who needs help. Many if not most drink the Kool Aid.
Thank you very much for the many helpful suggestions and input which I’m researching and please keep the submission ideas flowing.
Regards
Bruce
Ruminant Pink Friday 