Friends,
On Monday, we talked about investment buckets, and I challenged you to document where all your money is currently parked. If you hadn’t done that before, I suspect the exercise was revealing for you.
When we think of our personal finances in terms of investment buckets like this, we’re talking about asset allocation. It’s a fancy term, but the principle is quite simple.
For me, those buckets are my cash warehouse (max-funded life insurance), gold, Bitcoin, capital-efficient stocks, cash-flowing assets like real estate and mortgage notes, private investments and any alternatives. I’m confident that a balanced allocation across these buckets is how you make your money bulletproof.
Now let’s talk about order of operations.
Those following the conventional retirement planning model may have several of these buckets that are completely empty. If that’s the case, the temptation is to think that you need to start filling them all up at once. But I don’t think that’s the best approach.
Instead, it’s best to build from the bottom up… just like you would a house. And that means starting with the foundation.
In our model, the foundation is the cash warehouse, gold, and Bitcoin. Those are our savings vehicles. Personally, I wouldn’t put a dime into the stock market until my foundation was in place.
Now, that suggestion flies in the face of the conventional model… which has convinced three generations that putting money into a 401(k) plan is how you save for retirement.
That’s how Retirement Incorporated went from non-existent in 1970 to a behemoth with $30+ trillion in assets under management today.
And to be fair, the conventional model did work out okay for those who first pioneered it. The stock market has moved significantly higher in nominal terms over the past 40+ years.
The industry will tell you that this is just how the world works. They will swear that the market always goes up over time… because that’s been their experience.
But I have to ask – what else has happened over these past 40 years? Are there other variables that we should assess?
In 1981, the Federal Reserve’s target interest rate (the federal funds rate) nearly hit 20%. Think about that. How would you like to finance a home at 20%+ mortgage rates?
But then something seemingly magical happened…
For the next 41 years, interest rates gradually grinded lower over time. By 2020, the federal funds rate stood at nearly 0%.
That led the industry to believe that interest rates always go down over time. And this created a dynamic where people treated their home as a piggy bank – because they could refinance at a lower rate and pull equity out every five or six years.
What went unseen was the fact that cheap credit and monetary inflation constantly pushed asset prices up across the board.
The conventional model benefited tremendously from this… until it hit the wall in 2022. That’s when interest rates were allowed to rapidly normalize. And as rates grinded higher, that “diversified” mix of stocks and bonds that Retirement Incorporated sells both declined in tandem.
That was the signal that The Age of Paper Wealth is over.
Now, the stock market has since moved higher. But that’s in nominal terms. If we factor in inflation, we’ll see that a chunk of those gains over the past three years have been illusory.
What’s more, it’s been a small handful of stocks that are responsible for the vast majority of the market’s gains these past three years. Those companies tied to the artificial intelligence (AI) boom have pulled the indexes higher… while many other stocks have struggled or even languished.
And that’s why we want to build up our financial foundation first.
The foundation doesn’t make you rich. But it does make sure that you are always walking on solid ground.
Only after that foundation is in place should you focus on the other investment buckets. Order of operations is everything.
Now… knowing the order is one thing. Knowing the first move in each step, with specifics, is another. And that brings us to our final strategy session of 2026…
On Tuesday, November 17, I’ll host a free session that we’re calling The Blueprint Strategy Session: Your First 90 Days. In it, we’ll walk through a 90-day plan of action to bulletproof your money in 2027. Here is what we’ll cover:
- How to build your own asset allocation model using our proprietary worksheet
- Days 1 to 30: Exactly how to start building your gold and Bitcoin foundation, and how to dial in the infinite banking strategy for your cash warehouse
- Days 31 to 60: How we structure a capital-efficient stock portfolio geared towards the prominent macroeconomic trends
- Days 61 to 90: Getting up to speed on cash flow investments like real estate and mortgage notes to build monthly passive income
And I promise, we are going to walk through specifics with everything.
This session is meant to be directly actionable. My hope is that anyone can take what we cover and begin implementing it right away – or as soon as they are ready.
I believe we did most of our strategy sessions during business hours this year, so we’ll set this one for 8:00 PM Eastern – to cater to anyone who cannot attend during the day. Also, we plan to provide attendees with several resources for this one – more on that to come.
So please mark your calendar for Tuesday, November 17 at 8:00 PM Eastern. As I mentioned Monday, we’re going to do this one in-house, so we won’t need a registration page. I’ll send the access link to you directly by email.
— Joe Withrow