The Rich Know This, Why Don't You?
Why 'Everyman' Investing Is Keeping You Poor
Annie Massa recently wrote an article for Bloomberg News about major changes taking place at The Vanguard Group.
Vanguard has decided that clients who want individual advice about their investments must now first reach a threshold of at least $5 million in their Vanguard portfolio.
(And you even need to reach a threshold to read about it!)
That’s because the article, and its hugely important lesson for investors, are tucked snugly behind a Bloomberg Law paywall.
So, you might be wondering:
Why would you need at least $5 million invested to have access to individual investment advice if automated ETF investing delivers superior results?
Isn’t it impossible to beat the market?
Aren’t we better off not picking our own stocks?
Why does Vanguard’s marketing push ETFs to the ‘everyman’ investor while reserving personalized advice for the $5 million-and-up club?
Are these wealthier investors getting taken for a ride?
Yes…
But it’s a ride that will grow their wealth much faster than the ‘lazy river’ automated investing ride everyone else has been sold.
And boy has it sold.
Vanguard now manages over $7 trillion in investment assets as of 2021, second only to Blackrock’s $14.5+ trillion across its iShares funds.
To play Devil’s Advocate, I would never argue that these funds don’t build wealth for their ‘everyman’ investors. In fact, they can be an excellent way to gain broad market exposure with the absolute minimum effort and upfront fees.
~ However ~
They don’t hold a candle to active investing.
And this is something which wealthier investors, even those who patron ETF giants like Vanguard and BlackRock, know all too well.
So if the rich know this, why don’t you?
As I’ve mentioned before, these ultra-wealthy investment firms are using powerful psychological marketing techniques to scare and seduce throngs of investors like you into surrendering control over your own investments.
They charge you a ‘low’ fee, and they provide minimal service.
Unless you have $5 million or more, that is.
But there is good news.
Now that ETF Kings like Vanguard, and their wealthier patrons, are so clearly showing you that active investing is superior, there is no more confusion.
Now there is only action.
Now there is only you finally deciding to buck up and take control of your own investing.
You understand clearly that the best way to develop as a person while rapidly and consistently growing your wealth is to invest actively.
This can include ETF investing, of course.
But the foundation should always be a reasonably diversified portfolio of best-in-class stocks issued by healthy, growing companies.
No hype.
Just strong, proven track records and returns well above the market average.
Even better if they reward you with dividends for your investment support.
I’ll have more on what to look for in future posts.
Thanks for your time,
To your wealth!
Roger S. Conrad