The Longevity Dividend
In 2021, people around the world were living, on average, just over 70 years. That’s pretty amazing when you consider that only 200 years ago, people were only making it to about half that age.
This remarkable increase is thanks to various improvements in science, healthcare, and global living conditions, among many other things.
Another significant factor contributing to longer lifespans is something called "The Longevity Dividend.”
The Longevity Dividend, as explored in this recent study, highlights the fascinating relationship between lifelong learning, life expectancy, and the dividends (both literal and figurative) one can reap from a longer, healthier life.
In a world where the global population is witnessing a surge in individuals aged 75–100 years old, understanding The Longevity Dividend is a game-changer for any investor looking to maximize the benefits of compounding in their portfolio.
At its core, the idea is simple: the longer you live, the longer you can see your investments grow and compound. As you already know, time truly is money in the realm of dividend investing, so longevity is a precious asset, and lifelong learning is a key contributor to longevity.
The study shows that continuous intellectual stimulation and personal development not only contribute to healthy aging but also extend the active years in longer lives.
The result is a prolonged period where you can actively participate in society, make productive contributions, and, incidentally, witness the compounding magic unfold in your portfolio.
In previous newsletters, I’ve referred to your portfolio as being like a garden. The longer you nurture and care for it, the more bountiful the harvest, and you can’t rush nature.
Dividend investing, after all, is a marathon...not a sprint. And in this marathon, the tortoise ultimately ends up outpacing the hare.
Lifelong learning is the tortoise's steady, persistent stride. It not only enhances your ability to make investment decisions but also contributes to a healthier, more fulfilling life.
Connecting the dots: A healthier, more fulfilling life not only leads to greater personal satisfaction but also contributes to the prosperity of society as a whole.
Society benefits significantly when individuals who are full of knowledge and experience remain active contributors for as long as they can. Warren Buffett and Charlie Munger are evidence of that, and are prime examples of life-long learners.
So, what does this mean for dividend investors like you and me?
First, remember that dividend investing is a journey, not a destination. It is an infinite game that you will play for the rest of your life, and the longer you stay on the path, the more scenic and prosperous it becomes.
Second, invest not only in stocks, but also in yourself. Stay mentally and physically active, and embrace your development in both departments as a fun and fulfilling way to enjoy the power of compounding for an extended period.
With that said, I want to hear from you: What are your favorite ways to stay mentally and physically active? Write to me here and let me know.
And a big thank you to the 20 readers who responded to last week's newsletter! You can read some of the responses at the bottom of this email in the "Hot Takes" section. 👇
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IN MY PORTFOLIO 📈
ICYMI 🎥
I Just Bought The PERFECT Dividend Stock (At All-Time Highs) 🚨
If you've been reading the newsletter over the last few weeks, then you'll already know about the new position I added to my portfolio. If not, you're in for a surprise.
In this video, I'm revealing the latest addition to my dividend stock portfolio, and will discuss, at length, why I decided to add this company when the share price is sitting at all-time highs.
CAREFULLY CURATED 🔍
📺 Investing Like Charlie Munger - Charlie Munger had a tremendous impact on Warren Buffett's investment philosophy, influencing him to incorporate principles of business quality and durable competitive advantages, which significantly contributed to the success of Berkshire Hathaway. This video delves deeper into Munger's approach, and highlights the incredible difference it can make on portfolio performance over a long period of time.
🎧 The Power of Simplicity - In this episode of the R.W.H. podcast, William Green chats with Anthony Kingsley, who oversees more than $10 billion as the portfolio manager of the Findlay Park American Fund, which has crushed its benchmark index by 1,200 percentage points over 25 years.
📚 Investing In The Good Life - "The Good Life" includes having strong relationships, continuous learning, doing meaningful work, being generous, and staying active and healthy, amongst other things. This article explains how investing can either get in the way of that or support you in your pursuit of "The Good Life." Honestly, this is one of the best Seeking Alpha articles I've read in a while, and it's worth taking a few minutes to check out.
SINCE YOU ASKED 💬
"I'm also a dividend investor (52 years old, 530k portfolio) and I'm deciding if it's a good idea to keep buying as much as we can every month or save a bit more this year for the potential recession (=major bargains) later in the year. What do you think?"
- Marcio | Email Submission
Trying to predict the stock market is tough, and while we all want to score big deals during a recession, we can't be sure if those opportunities will actually show up.
So, here's my take: instead of going all in with your contributions, consider slowing down a bit, and start saving some cash on the side. This way, you're still investing regularly, but you're also building up some extra money just in case, so you're getting the best of both worlds.
If the market does eventually head south, having that extra cash will come in handy and you'll be ready to swoop up some good deals without feeling like you missed out on your usual investing routine.
Have a question? Ask me here to see it featured in an upcoming newsletter.
HOT TAKES 🔥
Last week, I asked readers which books were on their reading list for 2024. Here are some of the responses:
Troy said: Currently, I have “The Only Investment Guide You'll Ever Need” by Andrew Tobias and “Poor Charlie’s Almanac” on deck. I’m also finishing up a book called "Investing in Duplexes, Triplexes & Quads". My goal for 2024 is to invest in real estate. I hope to buy a triplex this year, but this would be a huge leap for me.
Nigel said: I’ve got a few investing books on my list for this year: “The Intelligent Investor” by Benjamin Graham (which was noted by most of the investors interviewed in “Richer, Happier, Wiser” has long been on my list and so this is the year I finally dive in). “The Ultimate Dividend Playbook” by Josh Peters and Morningstar (I used to watch his dividend analysis videos years ago and found his passion for dividend investing infectious). “Invested” by Danielle Town and “The Intelligent REIT Investor Guide” by Brad Thomas.
Patrick said: Favorite investing book — “A Random Walk Down Wall Street.” Sleeper book — “Made in America” by Sam Walton (sorta like your favorite of Howard Schultz's, it describes Sam's building Walmart to what it was by the end of the 1990s).
Dan said: I have just begun on building my knowledge through reading and the book I have started with is "Rich Dad, Poor Dad" and my gosh has this book changed the way I think about and look at money. I am truly amazed that this book has this big of an impact on me, but I am blessed by it, and I look forward to my next read!
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