5 mins
September 1, 2022

Contrarian Investing: Why the Rich Get Richer

Contrarian Investing: Why the Rich Get Richer

Find the path that leads to your goals.

If you want to see different results as an investor, you can’t continue doing the same things you’ve always done.

Most of us are taught that there’s one correct way to build wealth. Go to school, then get a job and use your paycheck to buy a house, contribute to a 401(k), and invest in stocks and mutual funds, all with the goal of saving so you can enjoy retirement in your 60s and 70s. 

But we don’t all have the same goals, so why are we trying to follow the same path? Maybe you want to retire early, or start working less hours so you can spend more time with your family. Or maybe you’re happy with your job but tired of feeling like your entire future depends on the ever-changing state of the stock market.

Your goals should direct your investments, but many of us instead allow our investments to determine our goals. If you feel boxed into a life that you’re not even sure you want, it’s time to take a page out of the ultra-wealthy playbook and start investing like a contrarian.

Learn from Your Losses

Contrarian investing didn’t come naturally to me at first, and there were certain lessons I had to learn the hard way. 

I was still relatively early in my career when the Dot-com bubble burst. Up to that point, I’d primarily invested in paper assets, including an IRA, a 401(k), and mutual funds. My investments took a large hit, and because I was still very inexperienced, I followed the standard advice that every financial advisor will give you: Wait it out, diversify across more funds, and eventually the market will turn around. 

This advice worked for a time, and by 2008, I had recovered my losses and then some — just in time for the Global Financial Crisis. This time I lost 33% of the value of my portfolio, and I was determined to make sure it never happened again. 

I wasn’t sure exactly where to go next, but I knew that I couldn’t keep doing the same things and expecting new results. This realization led me to start seeking out alternative assets and learning more about the strategies that the vast majority of people never take advantage of. 

Contrarian Investing is a Pathway to Freedom

When you’re an inexperienced or newly Accredited Investor, it’s natural to focus on going with the flow, using strategies that feel safe because they have worked for the people around you. But at a certain point, it’s important to recognize that some of the most effective investment strategies are not well-known. It’s almost like the ultra wealthy have the best kept secret on the block. Now I want to share some of the things that I’ve learned with you.

As you build your knowledge and develop a network of people you can trust for advice, you’ll gain the ability to stop evaluating investments based on their popularity and start choosing opportunities based on the specific benefits they can provide you. 

Take tax efficiency, for example. If you invest your money exclusively in stocks, bonds, and mutual funds, you will miss out on some major tax deductions. Even investing in real estate has its limitations, because it typically does not reduce the amount of income taxes you have to pay. 

How to Invest Like a Contrarian

Your investment strategies will change dramatically when you stop focusing on what your peers are doing and start paying attention to the people who have already achieved the things you want for your own life. These people are the only ones who can truly speak from experience about the specific path you are on.

This is why I started First Generation Capital Partners. I know what it’s like to feel like you’re on a different path than the people around you. But with the help of mentors and a contrarian mindset, I was able to build a pathway to my own personal freedom. Now, I want to help other Accredited Investors do the same. 

Contrarian investing can sound intimidating, but I found that getting started was actually relatively simple. My first step was to really think about where I wanted to go. I tried to stop focusing on what I’ve been told is realistic and instead dream up my ideal life and work backwards from there. 

If you’re looking for a partner who’s committed to helping you build your ideal life with investments that fit your needs, FGCP could be the perfect fit. Fill out this brief form today to get in touch and find out how we can help you.

September 1, 2022
Billy Keels