As Matt explained yesterday, the government recently handed investors like you a big gift…
For the first time in nearly a century, it’s made it easier for all investors — regardless of income or net worth — to invest in the private markets.
This was a big step for the government. But it was just the first step.
You see, a number of other important changes just came out of Washington…
And as you’ll discover today, these changes could dramatically increase the size of your retirement nest egg.
$3.3 Trillion in Retirement Savings
Roughly 50 years ago, a group of individual investors petitioned Congress to create a new type of retirement plan…
This savings plan would help investors minimize their taxes and maximize their future profits.
Congress eventually approved this plan and dubbed it the “401(k).”
As you might know, a 401(k) allows you to take a portion of your salary — and instead of paying income taxes on it today, you can invest it in the stock market to build a nest egg for the future.
Today, 401(k)s are one of the most popular retirement plans in the country, with total assets of more than $3.3 trillion.
But here’s the thing…
As popular as these plans have become, they still have one major drawback…
Limited to the Public Markets!
For years, the government mandated that you could only invest in publicly traded stocks through your 401(k).
That means you were stuck earning typical stock market returns…
In other words, roughly 6% or so each year.
However, as The Wall Street Journal recently reported, that’s all changing…
According to The Journal, 401(k) plans can now invest not just in the public markets, but in the private markets, too.
In other words, now you can use your 401(k) to invest in private startups!
Double Your Nest Egg
The Journal proclaimed that private shares could “boost 401(k) investors’ returns.”
And CNBC said adding private investments to your retirement could be an “easy way to nearly double the equity return that your 401(k) is generating.”
You see, on average, private startup investments generate far higher returns than stocks.
As Matt explained yesterday, a report by Cambridge Associates concluded that, over the past 25 years, a diversified portfolio of private startups returned roughly 55% per year.
That’s nearly 1,000% higher than the average stock portfolio returns.
That’s why, even if you allocated just 10% of your 401(k) plan to private investments, over time, you could essentially double the value of your retirement account.
Why the Government Wants You to Invest in Startups
You might be wondering why the government is taking such extraordinary steps to encourage investors like you to get into the private markets.
Well, it’s because it’s finally acknowledging something we’ve been saying for years:
The stock market is dead!
According to The Wall Street Journal, the number of publicly traded stocks has been cut in half over the past 20 years.
And the average returns it can generate have been going down for even longer than that.
So, by making these changes, the government hopes to give investors like you what the Journal calls “access to an investment that has historically boosted returns for pensions, endowments and wealthy individuals.”
We’re Here to Help
Again, this is something Matt and I have been advocating for since 2013 when we first began publishing the Crowdability newsletter.
So we’re thrilled that the Government is finally catching up and making it easier for you to get into the private markets.
But, to be clear, this change doesn’t come without risk…
If you don’t know what you’re doing in the private markets, you could make some bad investments and lose your shirt.
That’s why we’ve spent several years building out tools and resources to help make it as easy and low-risk for you as possible.
You can access the free resources we’ve created for you right here »
Happy investing!
Best Regards,
Founder
Crowdability.com
