jwithrow, Author at The Phoenician League

Winter Preparedness, Real Assets, and Advanced Wealth Strategies for 2026

Friends,

I hope the new year is off to a great start for you. It’s certainly been a winter wonderland up here in the mountains of Virginia. The ground has been covered in ice all week, and temperatures have been around zero degrees Fahrenheit every night.

This environment reminds me of why it’s wise to keep extra provisions on hand and to invest in alternative energy sources.

We’ve been routinely enjoying old-fashioned fires in the fireplace up here. And we just added a second 500-gallon propane tank to our homestead last month to make sure that the generator always has plenty of fuel.

In addition, I’ve been running my solar shed on a Jackery backup battery system since the solar panels will be buried in ice for the foreseeable future. If you haven’t seen these devices yet, they are incredible. You can get more information on them at: https://www.jackery.com/.

Here’s a picture of the frozen solar shed with our bare-faced cliffs looking down in all their majesty:

Winter preparedness and advanced wealth strategies

On the investment front, everything is playing out according to our initial 2026 investment outlook. Gold has already surpassed $5,200 an ounce while silver, copper, and uranium mining shares have gone parabolic – along with other investments in critical minerals.

2026 Investment Outlook: Real Assets, Rates, AI & Metals

Hey friends – we’re going to talk about our 2026 investment outlook today. But first – happy New Year!

I certainly hope that you had a wonderful holiday season. It’s such a magical time of year.

Here at the Withrow Estate, my daughter Maddie claims that we had the best Christmas ever. I love seeing the excitement in her and her brother Isaiah’s eyes when they walk downstairs on Christmas morning.

Maddie is eleven years old now… so I’ve come to terms with the fact that her lens on Christmas morning will likely change here in a few years. I have mixed feelings about that. But I’m learning to live in the present and cherish the moments as they come.

Speaking of moments, the kids got a drone for Christmas… and it’s pretty slick. This thing can fly up to 120 meters into the sky, which is about 394 feet. And it features a camera that can swivel to take some incredible pictures.

Here’s one the kids took of our property:

Drone shot before our 2026 investment outlook — default

I’m amazed at how sharp this is. You can see the old red barn in the bottom right of the picture, and the original farmhouse to the left of it. The clouds are striking against the crisp blue sky. And it looks like there’s a little snow on top of the mountains in the background. That wasn’t evident when looking up from the ground.

We’re still learning how to operate the drone effectively… with an emphasis on not spooking the neighbors. But we plan to take this thing on some hikes in the area to capture more stunning pictures here in the new year. I’ll share those with you as they come.

And speaking of the new year, I’ve spent a considerable amount of time reading, thinking, and assessing the prominent trends that will feed into our 2026 investment outlook.

What I learned from the great Nashville fire of 2025

“What’s that crackling noise… do you hear it?”

It was a blustery evening in Arrington, Tennessee – a picturesque unincorporated community about 35 minutes south of Nashville. After a great Thanksgiving week at my brother’s house, we were getting the kids settled in to watch Home Alone before bedtime.

That’s when the lady of the house walked in asking about the crackling noise. She was in the next room giving their 8-month old a bath and couldn’t figure out what the strange noise was.

Nobody thought much of it until my brother opened the attic door to investigate… and was greeted by a whirlwind of smoke, loose insulation, and 9-foot flames engorging themselves upon the exposed wood in the unfinished room.

Unflinching, he jumped into action. “The house is on fire! Everybody out!”

Slightly confused, the kids dutifully followed their mothers down the stairs and out into the cold night. I watched their exit from the door to confirm their safety, then I went to work evacuating everything I could think of.

First I grabbed our laptops out of the home office and rushed them out to the car, parked safely on the street. Then I ran back in and grabbed my briefcase, stashing everything I could into it. Phone chargers… the kids’ tablets… whatever else happened to be lying on the counter – I grabbed everything in reach and made my way for the exit.

On the way out, I passed my brother who was wielding a hand-held fire extinguisher and calling for his cat. Upon depositing my second round of salvaged possessions into the car, I dashed back to the house, determined to help save the cat.

“Joe, it’s too late,” my brother called from the curb as I approached the door. Ignoring his warning, I pulled my shirt over my nose and started in.

“Joe! Look at the house man. You can’t go back in… you’re not replaceable!”

I made it two steps before an ocean of black smoke flowed down the stairs and filled the entire first level of the home nearly instantly… taking my breath away in the process.

I was forced to heed my brother’s warning and retreat back to the curb. That’s when I finally looked up and saw what he was referring to:

It looked like special effects from a movie… but it was real. A fireball had engulfed the upper level of the house and was devouring everything with ravenous hunger.

Discover the Income Power of Mortgage Notes

Mortgage notes are a low-hassle vehicle for generating solid returns and extra monthly income power. This asset class remains something of a secret that Wall Street keeps hidden from regular investors, but there are no restrictions or barriers to entry.

As last week’s real-world story of Gateway Savings & Loan demonstrated, mortgage notes play a critical behind-the-scenes role within the financial system.

The fact is, investors help make 30-year fixed-rate mortgages possible. We wouldn’t be able to buy a home with a 30-year fixed rate unless investors were willing to buy our mortgage.

And given that interest rates have risen substantially in recent years, investing in mortgage notes offers strong returns today – typically between 7 and 18% a year annualized.

I know we’ve only hit the highlights in our series over the past week, but I wanted to put this asset class on your radar. If the prospect of earning steady, asset-backed income power with creative tax strategies piqued your interest, The Phoenician League is hosting a free strategy session tonight to go much deeper on the subject.

We’re going to walk through every facet of mortgage note investing—from the basics to advanced tactics. And we’ll walk through a live example of how to analyze an available mortgage note in real-time. We’ll talk extensively about due diligence and risk management as well.

Unlocking Tax-Free Passive Income

In the good old days of American politics, there always seemed to be a push for presidential candidates to release their tax returns.

The media would put out the notion that it was somehow noble for a candidate to pay a lot in taxes. And that’s why the candidates who were savvy businessmen never went along with it. Then the media would speculate about why they refused to show the American people their tax return, seeking to paint them in a bad light.

Ahh, the good old days.

That’s back when presidential debates revolved around meaningless political topics and good old-fashioned mudslinging… rather than assassination attempts and arguments over who’s a he, who’s a she, and who’s an it.

Nostalgia aside, the reason certain presidential candidates didn’t release their tax returns was that they weren’t paying any taxes. Or if they were, their tax rate was minuscule.

The mainstream belief is that the tax code is all about raising revenue for the government to fund civil services. But that’s just not the case.

The federal tax code consists of over 70,000 pages. Yet, less than five percent of those pages are about paying taxes. In other words, less than five percent of the US tax code pertains to collecting revenue for the government.

The other 95 percent of the code is all about how to avoid paying the taxes that the first five percent says we owe. That’s the whole point underlying such a complex code.

So the US tax code is actually about how not to pay taxes. It was written to show “those in the know” how to legally avoid paying taxes. But regular folks can follow it too. We just have to know what the code says.

Now, the Internal Revenue Service (IRS) classifies income in different ways. When it comes to mortgage notes, we need to ensure that the income they generate for us is considered ‘active’ income per the IRS definition.

The easiest way to accomplish this is to invest in mortgage notes through an LLC established specifically to buy mortgages. This unlocks the tax code and allows us to shift a lot of personal expenses to the business… and create some phantom expenses to boot.

Crafting Financial Freedom

We talked quite a bit last week about the secret world of mortgage notes as an alternative investment class for financial freedom.

The power of mortgage note investing can be unlocked if we commit to building a portfolio of mortgages – just like an institutional investor would. This is how we can craft true financial freedom.

When we left off last week, we profiled a mortgage note listing that will generate $605 a month in extra income for whoever invests in it.

Starting there, let’s assume that we commit to buying a new mortgage note each year with similar characteristics to build out a portfolio. Obviously the numbers will be a little different for each note, but let’s assume that we can get another $605 in monthly cash flow for each note that we acquire. We’ll call this our financial freedom plan.

Here are the numbers if we simply add one mortgage to our portfolio each year:

Again, the numbers won’t be quite this clean in practice. But investing in a new mortgage note like the one we profiled each year can create thousands of dollars in extra monthly income for us in just a few years’ time.

And this projection may be overly conservative… because it assumes that we aren’t reinvesting our profits. So what if we took this extra income and committed to adding a second note to our portfolio each year?

Mailbox Money from North Carolina

Here’s a mortgage note listing that hit the market recently.

At first glance, this looks like a charming home in a nice neighborhood in Plymouth, NC. It’s a small town on the banks of the Albemarle Sound in eastern North Carolina – about an hour and twenty minutes away from the Outer Banks.

The mortgage balance is $57,000 and there are 173 payments remaining. That’s over 14 years. The interest rate is 9.5%, and the monthly P&I payment is $605 a month. That would become our cash flow if we made this investment.

The seller listed this note for $45,000. That’s the ask price… but it is negotiable.

The seller’s estimate suggests that this home is worth $125,000, which is more than twice the mortgage balance. That’s good. But we would do our own due diligence to verify the home’s value – because it would become our collateral if we were to invest in this mortgage.

What’s great about this asset class is that we have all the numbers up front. That makes it easy to analyze from an investment perspective.

Given the monthly payment of $605 and the remaining term of 173 months, we can quickly calculate that we will receive $104,665 in payments over the life of this note. That’s mailbox money coming to us from North Carolina.

Mortgage Notes – Breaking Down the Barriers

I mentioned yesterday that you don’t need any specialized knowledge to invest in mortgage notes. And that’s because we utilize professional loan servicing companies to manage the mortgages that we invest in.

These companies are akin to property management firms for real estate investors. They send out monthly statements, collect the mortgage payment, and provide ongoing customer service for homeowners.

That makes investing in mortgage notes completely passive – investors don’t need to do anything other than communicate with the loan servicer periodically. The homeowner has no idea that we exist.

I suspect many of us have received a letter in the mail at some point notifying us that our mortgage had been transferred.

That letter provided us with information on how we should make our mortgage payment going forward, and it gave us a website and phone number we could call for customer service.

The letter was likely an indication that a new investor had bought our mortgage. Except it didn’t provide us with many details on that matter… it simply gave us the information we needed to manage our mortgage going forward.

So, investors don’t need any specialized knowledge to invest in mortgage notes. We simply let the professionals do the work for us.

The Secret World of Mortgage Note Investing

As I’m sure we know well, when a homeowner takes out a mortgage to buy a property, the lender issues a promissory note that outlines all the terms of the loan.

That note is an asset. It gives the lender the right to receive the monthly mortgage payments that the homeowner makes, and it spells out the lender’s security interest in the underlying home as collateral should the homeowner default on their obligations.

However, lending institutions today only keep a small fraction of the mortgages they originate on their own balance sheet. That’s because holding mortgages reduces the capital they have available to make new loans, which is their core business.

For this reason, lenders sell most of the mortgages they create shortly after origination. And who do they sell these mortgages to?

Well, 80% of the time they package a group of mortgages together into mortgage-backed securities through a process called securitization. But the other 20% of the time, they sell each individual mortgage to investors.

Most often those investors are insurance companies, pension funds, and hedge funds. They tend to buy large blocks of mortgages in one sitting. But here’s the thing – there are no accreditation requirements. And that means individual investors can also buy mortgages at will. Anyone can engage in mortgage note investing.

Of course, most investors don’t realize that this is an option. And the prospect of buying a mortgage seems daunting. It sounds like it requires a lot of work and specialized knowledge. Not to mention the cost – doesn’t it require deep pockets to buy somebody’s mortgage?

From Bank Runs to Cash Flow – A Flashback to the 1980s

It was Friday afternoon and the financial markets had just closed for the day… but the mood was tense in the boardroom of Gateway Savings & Loan.

President I. Owen Funderburg knew he needed to steel his resolve, but he couldn’t help pacing nervously. He needed to find an answer to an unexpected problem.

The year was 1980, and the Federal Reserve (the Fed) had just raised interest rates again – sending shockwaves through the small thrift’s once-steady world.

Gateway’s ledger was bleeding red, and the phone lines buzzed with worried depositors demanding to withdraw their money. The threat of a bank run was imminent.

Funderburg understood the problem very well.

Gateway Savings & Loan had built a large portfolio of fixed-rate mortgages throughout the 1970s – when interest rates were more reasonable.

But with Mr. Volcker at the Fed hellbent on whipping inflation by raising interest rates dramatically, the bank’s short-term deposit costs now exceeded its loan yields… making its mortgage portfolio a millstone around Funderburg’s neck.