TEN ROADSTHE Richesto
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ten THEroads richesto the ways the wealthy got there (and how you can too!) ken fi sher WITH LARA HOFFMANS John Wiley & Sons, Inc. ffirs.indd iii 9/6/08 10:51:19 AM ftoc.indd viii 9/6/08 10:53:30 AM TEN ROADSTHE RICHESto ffirs.indd i 9/6/08 10:51:18 AM FISHER INVESTMENTS PRESS Fisher Investments Press brings the research, analysis, and market intelligence of Fisher Investments’ research team, headed by CEO and New York Times best-selling author Ken Fisher, to all investors. The Press will cover a range of investing and market-related topics for a wide audience—from novices to enthusiasts to professionals. Books by Ken Fisher The Ten Roads to Riches The Only Three Questions That Count 100 Minds That Made the Market The Wall Street Waltz Super Stocks Fisher Investments Series Own The World Aaron Anderson Fisher Investments On Series Fisher Investments on Energy Fisher Investments on Materials ffirs.indd ii 9/6/08 10:51:18 AM ten THEroads richesto the ways the wealthy got there (and how you can too!) ken fi sher WITH LARA HOFFMANS John Wiley & Sons, Inc. ffirs.indd iii 9/6/08 10:51:19 AM Copyright © 2009 by Fisher Investments. All rights reserved. Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada. 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ISBN-13 978-0-470-28536-7 Printed in the United States of America 10 9 8 7 6 5 4 3 2 1 ffirs.indd iv 9/6/08 10:51:19 AM CONTENTS Preface: Why Ten Roads? ix Acknowledgments xxiii Chapter 1 The Richest Road 1 Picking a Path 2 Newer or Better? 4 Built to Sell or Built to Last? 6 Bootstrap or Finance? 9 Public or Private? 10 The Big Bull’s-Eye 12 Founders Are Quitters—Just Do It 16 Chapter 2 Pardon Me, That’s My Throne 23 Gray Hair and Dues-Paying 24 A CEO-volution (Through My Father’s Eyes) 25 How to Lead 32 How to Get the Job 33 The Big Payday 37 CEOs and Superheroes 39 The Best Part 41 Chapter 3 Along for the Ride: Ride-Alongs 45 Why Ride Along? 46 Pick the Right Firm 48 Be the Right Guy 52 Chapter 4 Rich . and Famous 59 The Talent Show 61 Potholes Ahead No One Sees! 65 Mogul Meandering 70 v ftoc.indd v 9/6/08 10:53:29 AM vi Contents Chapter 5 Marry Well. Really Well 77 How to Marry a Millionaire Billionaire 79 Like a Fine Wine—Well Maintained 86 Men Can Play Too! 89 Love, Marriage, and Money 92 Chapter 6 Steal It—Like a Pirate, but Legally 95 Crusader or Pirate? 96 Raider’s Road 97 The Richest Legal Road 99 Tort Us and the Scare 100 Target Practice 108 When a Pirate Becomes a Villain 111 The Inside Track 113 Chapter 7 OPM—Not Opium: Where Most of the Richest Are 117 Basic OPM Career Rules 118 Steps to OPM Wealth 120 Hedge Your Bets 127 Private Equity’s Big Bucks 132 Don’t Break the Law 133 Love Capitalism, Not Social Acceptance 136 Chapter 8 Inventing Income 141 The True Inventors 142 Writing for Dollars 144 Political Pensions—and Good News 149 If You Can’t Be President . 151 Think Tanks Run Amok—a Sham-Scam 155 Chapter 9 Trumping the Land Barons 159 Monetize It 160 The Fool’s Bargain 163 Getting Started 166 Buy, Build, or Both? 169 Where to Be and Not to Be; That Is the Question 171 ftoc.indd vi 9/6/08 10:53:30 AM Contents vii Chapter 10 The Road More Traveled 177 Income Matters 178 Saving Grace 180 Get a Good Rate of Return (Buy Stocks) 185 The Right Strategy 188 Bonds Are Riskier Than Stocks. Seriously 195 Like Hetty? 198 Conclusion 203 Notes 205 Index 221 ftoc.indd vii 9/6/08 10:53:30 AM ftoc.indd viii 9/6/08 10:53:30 AM PREFACE why ten roads? Before reading this book further, please read this preface. Wouldn ’ t it be wonderful if everyone were rich and no one poor? If poverty didn ’ t exist? If the only wealth disparities were whether she had $ 20 million, he had $ 7 million, and another one had $ 7 billion? Feel free to disagree, but I don ’ t see much merit in poverty. Sadly, I can ’ t see poverty being eliminated in your lifetime or mine. Still, I believe you can do your little part toward that goal by making yourself wealthy in a way that creates wealth for society as well. If you get yourself rich in one of a handful of appropriate ways, you make the world a better place. Others benefi t as you get rich, as you will read later. I, for one, would like you to do that. But how? Well, that ’ s what this book is about. There are really only ten ways to get rich. This book details them and shows you the good and bad qualities of each so you can pick among them and decide which is right for you. Then, the book teaches and guides you on the basics of each. It ’s true not everyone can become rich. But it ’ s clear to me that most people can — they just don ’ t know how. If more people knew how, we would have more rich people and the world would be a better place. I ’ m asking you to read this book and then do your part. Now, if you know me from past books or my long - running Forbes “ Portfolio Strategy ” column, you may not know I ’ m a roads scholar. Not a Rhodes Scholar who got money to study at Oxford, ix fpref.indd ix 9/8/08 4:32:50 PM x Preface but the more important kind — that studies the various roads leading to fi nancial success and failure. It started as a kid in the 1950s, dreaming of becoming a profes- sional baseball catcher and simply adoring Yogi Berra who famously said, “ When you come to a fork in the road, take it. ” For decades I ’ ve kept a large version of that quote on a note board within three feet of me at my desk, collaged with photos and notes of people that are and have been important to me. Takes decades of wisdom to get life down that simply. Pretty much sums up how to get super wealthy, once you understand the roads. Berra later decried most all his most famous Yogisms. He claimed this particular quote was simply driving directions to his home, and when you got to the fork it didn’ t matter which way you went because they reconnected later and either fork got you there. If so, it’ s kind of a Zen- like statement about continuing — like the command, “ Further ” — and we can use that too. But growing up I assumed Berra’ s was a comment about making quick, fundamental, timely decisions without great road signs. Maybe I was wrong all this time. But I still prefer my interpretation of the great American Yogi. In life there are roads leading to riches and roads not. There’ s nothing wrong with ones that don’ t, but if you travel them you ’ ll go where they take you. Don ’ t be surprised. To methodically get rich there are only ten basic roads. Find one making sense for you, get to that fork in the road, take it, and stick to it. But ten roads can be confusing. Ten! Hence the need for this book.