Many of you are investing in 401(k)’s now and are going to keep your money invested in the market while you learn to practice the Phil Town build up for the stocks on your own. But even if you’re not ready to in- vest for yourself, there is an alternative to paying those mutual fund fees. Phil Town recommends you put money into Spyders (symbol SPY). Many mutual funds charges about 1.5 % in fees. SPY charges .08% which is a big difference—you’ll pay 16.25 times less for SPY.

Have you seen this silly article do right now in the Wall Street Journal- “5 Ways to Fix Up Your 401(k) Plan?” Here’s the gist of what those five tips are:

1. Save ’til it hurts and invest in mutual funds. 2. Save some more and invest in mutual funds. 3. Don’t touch the money—leave it in the funds. 4. Pay attention to fees. 5. Get your coworkers saving more, too.

Phil Town say’s he had to laugh at the naïveté but I doesn’t think the author meant it as a joke. With a little knowledge you can do better than just “leave it in the funds” even if the market goes nowhere.

Isn’t it true that if the investools and training get you up to 15% a year, your $10,000 won’t stay $10,000 very long even with a $1000 overhead that you pay for the professional tools?  You’ll be making money and you’ll be adding to your investment capital from multiple streams of income as soon as you see your skill and competency grow.

Assuming you make 15% and you can add $300 a month, and subtracting the $1000, in five years you’ll have $42,000.  At which time the friction of $650 is only 1.5%.  In ten years you’ll be at over $100,000.  In twenty, just under $500,000.  In thirty, just over $2 million.  At which time, the investment in tools and education will seem like a good idea.

Phil Town asks everyone to consider this: if the stock market does sprout wings and start to soar again and you’re a trained investor, won’t you do at least as well as a mutual fund investor who doesn’t even beat the market?

So why are we continuing to try to make money in this market? Because now we are back in an RULE #1 investors stock market.  Back in the 60’ – 80’s the market had massive ups and downs that added up over 20 years to a zero rate of return.  But in exactly that sort of market investors like Warren Buffett just killed it.  That’s when he made his billions on billions.  And if you follow what Phil Town teaches you in PAYBACK TIME, you can just blow it out, too. Phil Town will tell you why in an upcoming book he has written for 2010.  Phil Town promises that he’ll show you exactly how.

A friend of mine asked me the other day this question: “How do you like this guy Greenwald who wrote the book :”Value investing : from Graham to Buffett and beyond”?
I told him that I haven’t read it yet but the very title is off a bit, in my humble opinion.  Graham is definitely a value investor – buying what Buffett calls ‘cigar butts’ – businesses that had a couple of puffs of cash left in them and were essentially lying around free.  By the 50′s those were almost impossible to come by.  And when you do that Graham did, you get a lot of bad businesses to sort through.
Buffett mantra became ‘better a great company at a fair price than a fair company at a great price’ – quite different than Graham and hardly ‘value’ investing.  In fact, Buffett rejects the label.  He’s after growth at a value price – Coke comes to mind.  But he’s also happy with no growth.  Sees Candy, for instance.  Bottom line for Buffett is that the business should be durable, simple to put a value on and on sale.  If you follow those three concepts without skipping any of them, you’ll kill the market.
I love people who make decisions by basing the decision on a specific set of values.  Frankly, the Golden Rule is not a bad start for a value system.  For example, if you follow the Golden Rule and you think it is wrong for someone to take what is yours then you wouldn’t take someone else’s stuff.  Come on you guys.  You learn this in kindergarden.  So that should be a bedrock value, right?  Don’t take other people’s stuff.  Simple and basic RULE #1 stuff.
Well, then, apply it to all the decisions you are making in your life.  BB&T follows the Phil Town RULE #1 and golden rule value.  Bank of America follows the value of ‘show me the money’.  Which investing value do you like better?  Well, some of you like the show -me-the-money thing right up until its your stuff they are expropriating and then you don’t like it at all. You go for ‘show money’ by taking what isn’t yours, you’ll pay it back somehow because there is no free lunch. But I believe that in this world and the next, what goes ’round comes ’round.