If you’re feeling like you’re losing control of your money, there may be some truth to that.
Do you want your investments used as a tool to invest in other people’s political agendas? When it comes to ESG and BlackRock, for example, that’s exactly what’s happening. Through their mutual funds and ETFs, you’re part of their political crusade.
But being part of their political crusade probably isn’t one of the reasons you invested with them to begin with. No offense to BlackRock, but this is about your agenda—your retirement. Why would you waste your time with mutual funds when they’re voting your shares without your input?
This is your money. And the same is true for mutual funds/ETFs with Vanguard and State Street, where they vote shares on your behalf. This may not be what you signed up for when you were looking to save for retirement many years ago. You weren’t looking to underwrite BlackRock CEO Larry Fink’s ESG crusade.
Listen, I’m Your Survival Guy. I see the sausage being made in the kitchen. Today, when you’re investing in mutual funds, you’re basically forced to agree with how your shares are voted, no matter what. That used to be a non-event. The game has changed.
It’s not a good use of your money. It’s not capitalism when you’re stuck fighting another man’s battles. This is your money, your fight. Years ago, it was different. You were getting a diversified way to invest your money passively with Jack Bogle’s index funds. Set it and forget it. Right?
Even the so-called diversified index funds are hardly exempt from being overweighted in technology. Look at the Vanguard Total Stock Market Index, down 17.34% YTD. The name implies you’re getting a diversified mix, but you need to understand it’s the big dogs in the index that have the most impact. That’s the very nature of market cap (shares outstanding multiplied by price).
Investors are waking up today to this reality as they see the carnage on their statements and do not understand what’s happening with their money. Don’t let that be you.
This month’s RAGE Gauge continues the trend of full risk. This is not the time to make huge bets in areas you’re not familiar with, betting the farm on commodities you may not know how to harvest or mine. Remember, you’re not the only one thinking this way. The market is loaded with everyone’s opinions with real money on the table. There’s nothing sadder than losing it. Stick with me. Keep what you make alive and well and live within your means.
Action Line: Avoid the mutual fund groupthink. Avoid Larry Fink’s ESG crusade. Avoid ETFs and any other product where you’re just a number. Instead, invest directly in dividend-paying stocks with the Young Research’s Retirement Compounders Program. You own the stock. Period. You vote your shares. Period. If this approach sounds appealing to you, we should talk. You can reach me here.
E.J. Smith - Your Survival Guy
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