WEST LONDON, ENGLAND – Hello from London…
Life is beginning to reopen here as British authorities lift COVID-19 lockdowns, so my family and I have been exploring all the famous London tourist sites and museums while there are still small crowds.
One place we visited this week was the Tower of London. And it was perfect… we were the only ones there…
Now, it’s time for our weekly mailbag edition, where I answer the latest questions you’ve sent in…
Today, we address my family’s decision to keep mum’s house (and the reason for having an “Income-for-Life” policy)… selling my bitcoin early… and one reader’s curiosity when I said I hope my kids “never set foot in an academic institution”…
Reader question: I’ve been following your Postcards for about a year, so even though we’ve never met, I feel like we’re best friends. Therefore, I’m going to talk to you like a friend. What the heck are you even thinking about? You’ve been a constant proponent of living conservatively, having limited personal possessions and property (stuff), and keeping the bulk of your assets in physical gold and silver.
While I certainly express my condolences to you and your family over the loss of your mom, when it comes to making a sound financial decision, take the emotion out of it. London is one of the most overpriced property markets in the world. Yet you are actually considering selling of your precious gold to pay out your brother for his half.
So you’re going to sell a hugely undervalued asset (gold) to buy your mom’s house (a hugely overpriced asset)? Although I’m writing you from Arizona, let me know at which British pub I can meet you to shake you up and bring you back to your senses. When we meet, I plan to read back to you some select excerpts from what you’ve written over the past year. In the meantime, let’s find a realtor.
I appreciate the forthright message. I’m not going to sell any gold. Instead, I’m going to use a policy loan from my insurance policies to buy my brother out. This buys me time to decide, once and for all, if we’d like to live here on a more permanent basis.
I agree that London property is among the most overpriced in the world. We could probably sell this house and with the proceeds buy 10 properties in the Midwest, in somewhere like Cleveland, Detroit, or Akron… and become landlords and live off the income (and never have to worry about money ever again).
Reader question: For what it’s worth, I don’t think you are making a hasty decision about your mum’s house and its contents. Once you own them, you have the rest of your life to decide what to do with them. Were you to sell them now, they would be irreversibly gone from your life, forever. That, in my humble opinion, would be a hasty decision…
This insight, in my opinion, is the single biggest driver of our decision to stay. By staying, we’re keeping our options open because we can always sell the house next month. By selling, we’d be throwing that option away.
Options are valuable. We can see this in the financial markets. Holding our option to stay or go while we feel out the correct decision is the right thing to do. As a wise friend once told me, “When you don’t know what to do, do nothing.”
Reader comment: The answer seems simple enough… This is when you get a loan with your Income-for-Life policies as collateral. Keep the gold, leverage your wealth, and buy your house.
Yes, I agree. The whole idea behind the Income-for-Life policy is to be able to borrow money from the policy when you need it. This is exactly the moment I’ve been waiting for.
Reader comment: I would be kicking the s**t out of myself if I did what you did and sold all my bitcoin for less than $300. We all make mistakes. But as Bob Prechter says, “Some people would rather be right than rich.”
I find some irony in Bob Prechter’s quote, since he’s been steadfastly bearish on the stock market for the last 20 years of a bull market. As for selling my 3,300 bitcoin, sometimes I do kick myself for doing that. But then, I realize that I won the real prize: getting back together with Kate and the kids and having a priceless adventure with them.
I don’t think things would have turned out the same way if I’d made a $100 million dollars from bitcoin. In fact, I’d probably be dead by now from a drug overdose; or if not, at least I’d be a total d**k with all that money.
Reader question: When you wrote that you hoped that your sons never set foot in an academic institution or that they would have to pay for it themselves, I became curious. Please elaborate further!!
Why do we educate our children? The answer is, I think, to encourage the skills they need to make good decisions as independent adults. Good decisions are decisions that lead to a life filled with contentment and joy. (The word “educate” comes from a Greek word meaning “to lead out.”)
In no particular order, first, we’d like to teach our children to be humans that other humans like being around. There’s a lot involved in this statement, including many soft skills that they don’t teach in schools. Is there anything more important than this?
We’d like to help the kids experience many different activities, foods, people, climates, and situations so they can develop the skill of discernment – knowing what they like and don’t like. Again, I’m not sure school is the best place to learn discernment.
We’d like the kids to have the skill of learning by themselves. They call this self-directed learning. If we can get to a point where the kids can teach themselves, then our job as educators is basically done. Again, I’m not sure school is the best place for this. And finally, we’d like the kids to know how to take care of their bodies and minds.
The question is, what’s the best environment to educate the kids in these subjects? I don’t know. But the decisions we’ve been making as a family these last few years are our best guess at doing this.
And that’s all we have time for today!
As always, thanks for your questions. We love receiving your messages and I do my best to reply to every question. Please keep ‘em coming at [email protected]… But keep in mind: I can’t give personalized advice.
Also, thank you for all the encouragement and support of our journey. We’ve used your messages to “crowd-source” some of our most important decisions with great success.
And finally, if you live in London and would like to hang out with us sometime, please drop us a line. We love meeting up and making new friends!
– Tom Dyson