Longtime readers know that Palm Beach Research Group co-founder Mark Ford went from rags to riches the old-fashioned way… by working hard and then investing his income as carefully as he could.
The secret to his success was building wealth through safe, conservative investments and proper asset allocation—which are still our guiding principles to this day.
Here’s the thing… Mark made most of his wealth outside the stock market. Here’s what he said at the recent Legacy Investment Summit in Bermuda:
Now, I do invest in stocks. And I’m very happy to have done that. But when I look at my portfolio today, by far the largest portion of my assets is in real estate.
I can’t share everything with you… It’d take months to write about all the great ideas I heard there. So today, I’ll wrap up our conference coverage with Mark’s timeless wisdom.
Normally at the Daily, we stick to the markets. But our goal is to help you find money-making opportunities… wherever they may lie.
And in his presentation, Mark revealed three of his favorites outside the stock market.
A Rare Appearance
Mark is semi-retired now and remains mostly behind the scenes. But he made a rare public appearance in Bermuda on a panel called “Wealth Building Outside the Stock Market.”
He told the audience that building wealth involves much more than just investing in stocks and bonds. To ensure financial growth and security, he advised diversifying across multiple asset classes.
Regular readers will know this as asset allocation—the process by which you spread your wealth across different sorts of investments.
Mark generally recommends investing in what is true today… not what might be true tomorrow. That gets you into income-producing assets. If you do, you won’t have to time the markets. You just have to buy and hold.
But he surprised the audience when he said he has a small stake in speculative opportunities like cryptocurrencies. (Longtime fans of Mark know he’s one of the most conservative investors out there.) Mark again:
My No. 1 rule for investing is that I don’t invest in things I don’t understand. And I’ve never understood cryptos. But I was like, “Cripes, this guy made a billion dollars in cryptos.” I didn’t want to be left out at this moment… so I bought like five cryptos.
With proper asset allocation, Mark is comfortable setting aside a small portion of his capital to smart speculations like cryptos, though.
However, his main takeaway was that people need to go well beyond some combination of stocks, bonds, and cash to win at the wealth-building game.
So if you can’t reasonably expect to get rich with just stocks and bonds alone, what can you do?
Mark’s Three Favorite Asset Classes Right Now
Mark said most of his money is in real estate right now. The two other asset classes he mentioned were collectibles and direct business investments.
Here’s a breakdown of each…
Rental Real Estate: Next to business ventures, income-producing property investments have been the largest contributor to Mark’s wealth-building success. He invests for the income and sees appreciation as a bonus. But he warned that real estate investing can be tricky for inexperienced investors. Most mainstream real estate advice is bad. But if you do it properly—focusing on income—this asset class will do huge work for your portfolio.
Direct Investments in Entrepreneurial Businesses: This, by far, is the investment class that has given Mark his best results. If you do this right, you can expect terrific, steady income and the potential for enormous growth. The trick here is to invest only in companies you understand and have some control over.
Collectibles: This is a category of investing that you will probably not be interested in… unless you want to enrich not just your net worth, but your experience of living each and every day for the rest of your life, too. Mark’s preferred collectibles are fine art and first-edition books. But you can invest in anything from baseball cards to vintage cars to surfboards.
Mark’s asset allocation is time-tested and has been proven to work again and again. If you follow his strategy, it will help you build wealth over the long term…
…which brought Mark to an interesting paradox: What do you do with all that wealth once you’ve created it?
How You Should Get Rid of Your Wealth
Mark has built enough wealth to last multiple lifetimes.
But during the panel, he joked that he can’t wait to spend away most of it…
I think this is a really bad psychological problem for people who have a lot of money. It happens to everybody… It’s so common. I never thought it would happen to me. I couldn’t wait to just spend down my capital. I wanted to die leaving nothing to my kids.
Because the one sure way to make sure you destroy your family’s love for each other is to leave them with a lot of money. And the only people who I know who adore their fathers… had fathers who worked their asses off and didn’t leave them a nickel.
In other words, Mark said we should resist “the dumb idea of dying with the most money possible.”
He plans to donate his wealth to charities and place the rest of it in family trusts. The important thing he said is to decide while you’re still alive how people will use your wealth after you’re gone.
That’s solid advice for creating everlasting wealth—and using it properly.
Analyst, The Palm Beach Daily
P.S. Mark is still currently writing… but for a small, private blog that only a few people read. It includes articles on wealth-building and entrepreneurship, as well as personal entries. He’ll also continue to talk about his own personal investment portfolio.
From Jack L.: I do enjoy the Daily. I’ve learned so much from reading it. Teeka is amazing. But your other analysts are so good, too. When I get out of the financial hole that I’m in, I intend to invest in your more premium services.
Hopefully, with your advice, I’ll be able to recover some of my retirement. I have two jobs now. But I’m an optimist about the possibilities. Keep up your good work.
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