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The Mesh Report – Why Staying Out Of The Stock Market Is Just Plain Crazy
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Why Staying Out Of The Stock Market Is Just Plain Crazy

Dividend Sensei April 13, 2017 Comments Off on Why Staying Out Of The Stock Market Is Just Plain Crazy

Understandably the 2008-2009 financial crisis, and the 50% stock market crash that went with it, soured a lot of people on investing. In fact, just 1/3 of Millenials, the generation most harmed by the crash, are currently invested in the stock market. Now part of this has to do with this generation’s weakened earnings power, and high student debt load. However, it’s also true that many Millenials, like all too many Americans consider investing nothing more than a dangerous form of gambling; one in which the game is rigged against them.

However, not just has history shown this to be absoluely false, (long-term investing is the best, and for many, the only way to achieve a prosperous retirement and financial independence), but it also doesn’t make sense, even if you cynically believe that corporations run the world for their benefit.

After all, whether believe that the future is a New Zealand style Star Trek utopia, (which I do), or a dystopic corporate dictatorship, the best path you can take is to save as much as possible, and dollar cost average into a quality, diversified dividend growth portfolio. Think of it like this. If society manages to figure out its current problems, those of rising inquality, economic insecurity, and rapidly advancing AI and automation, then the world will be far richer in the coming century. That in turn will mean far higher corporate profits, which leads to generous, secure, and exponentially growing dividends.

On the other hand if we descend into a corporate controlled world run by a handful of plutocrats (which I’m optimistic won’t happen), then corporate profits, and dividends will also rise.

Either way, steady dividend growth investing is your best bet to live an increasingly propserous life over time. Because no matter how the future turns out, dividend investing ensures that you will be part of the true ownership society; quarterly recieving your cut of that filthy, filthy corporate lucre.

And don’t forget that if you can live beneath your means for long enough, and save enough of your income, than you too can also become a plutocrat. For example, take a look at how a diversified 5% portfolio (with 10% dividend growth) can do over the years and decades.

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