What Are Your Investment Goals?

[Marco Bario]

I live in Southern California where we're lucky to have a number of long-running investment groups. No matter the topic, I enjoy attending meetings to meet other investors face to face. This week I've been busy - attending meetings the last two nights and planning to attend FIBI in Pasadena tonight. 

People often ask one another what they do, or what they invest in. While interesting, I find I can get to know someone better by asking about their investment goals. Are you passive or active? What's your time horizon? Do you seek current cash flow, long term appreciation, or both? What's your risk tolerance and how do you manage it? What's your tax strategy?

Personally, I wear two investor hats:

1. I have a Solo 401K where I know I won't touch the funds for at least 10 years. Hopefully longer. Here I invest passively in commercial syndication deals where often there may be short term cash flow, but ultimately I underwrite for long term capital appreciation. My 401K  also holds a small portfolio of performing and non-performing notes. The performers are often formerly banged up assets where there may be higher risk, but also the potential for higher returns. The non-performers are assets where the timelines could stretch out. I don't have a problem being patient because I don't need the cash immediately.

2. I also have a fully taxable (kills me to write those words) entity where I acquire assets meant to put a roof over our heads and food on the table. Much different priority than the retirement account. In notes, this endeavor looks for shorter timelines and less risk. My first note purchases here were performers whos "job" was to cover the business's overhead. Rentals mix in well here because of tax savings. This is my ATM machine. Speaking of ATM machines, this entity recently invested in an ATM fund where we fully depreciate the ATM machines over the first several years. As investors, we expect monthly cash flow combined with tax savings from deprecation. Happy-Happy.

One other thing... I have goals and milestones set for both endeavors. I invested in the stock market for years without this. That was a mistake.

So... that's me. 

I would love to learn about other's goals.