I wrote about the Investors owners contract in my last post, but this is my version of a passive investor contract that is meant for passive investors that invest in index mutual funds and index exchange traded funds.
I’m asking you to do the same thing over and over again no matter what is happening in the market. It doesn’t matter if you’re on a fixed income or if you have all the money in the world. I’m asking you to put $XX a month into a total stock market index fund. I’m asking you to do this when the account is heading towards zero and when you have huge gains in the account. I want you to do this automatically without thinking despite what everyone around you is doing or saying. I’m asking you to do this consistently and repeatedly no matter what the result or outcome is. I need you to believe that this will work out for your good and this account will recover and grow over the years no matter how much money it has lost. I need you to do the same thing over and over again even if the results are negative. I need you to do the same thing over and over again even if we are at the top of a bubble of the greatest bull market of all time or at the bottom of the greatest market crash of all time. I need you to do the same thing over and over again even if you’re the only one doing it and everyone around you may think you’re crazy. I need you to go against the crowd. This takes tremendous discipline and it’s not an easy feat. This is not for the faint at heart. I’m asking you to have faith. I’m asking you to believe what you can’t see. I’m asking you to believe something that may not come to fruition for decades to come and I’m asking you to take action during that time. Don’t just believe, but act as if you believe by taking action and continuing to contribute to this account regularly. I’m asking you to fake it till you make it. I’m asking you to pick up yourself from the ditches, dust yourself off and carry on if you fall, stop contributing or sell down the portfolio due to lack of faith. At the end of the day the power of consistency and grit is what it means to be a passive investor. I want you to commit to building wealth slowly. I’m asking you to be a passive investor.