- Personal Finance
How To Invest Funds in Death and Taxes, investing in mutual funds with care
Invest with Certainty: Invest in Death and Taxes!
Benjamin Franklin's famous quote from a letter to a French dignitary celebrated the only two certainties in life: Death and Taxes. Investors may seek to move their funds into these certainties in the coming years, to invest not only in the declining population of baby boomers who are doomed to shuffle off their mortal coil over the next thirty years in increasing numbers, but also to invest in taxes via government-backed securities, reflecting faith in the ability of the government to improve their debt problems in the years to come.
How To Invest in Death
Individual stocks should only be purchased after consultation with a financial adviser, and your spouse or partner. That said, the only people who complain about the future success of the death care industry, are complaining about the pre-need plans that people are buying today to pay for their funerals tomorrow, and the potential longevity of the client base! Talk about cynical advisers, the fact that people are responsibly paying for their funeral before they need it, and living long, healthy, productive lives would be good news in any other industry! Fortunately, naysayers forget one simple fact of life: Everyone will die. Balancing investments across a couple different funeral homes and service providers is a good way to protect your investment from any individual company's failure to behave responsibly with pre-need funds.
Top funeral service and end-of-life care companies include Carriage Services (CSV), Servicecorps International (SCI), Stewart Enterprises (STEI) and StoneMor Partners (STON). Some surpring in-roads in the business of death has come from discount retail giants Wal-Mart and Costco, but they don't offer the same level of experienced, consistent results that funeral homes have handled for decades.
How to Invest in Taxes
If you had a choice between paying a late mortgage payment, a late electric bill, a late credit card bill, or a late tax bill, the advice most financial advisers would give is to pay the tax bill. The government, of all the bill collectors in the world, is the only one that can arrest you and put you in jail for failure to pay.
Taxes are an omnipresent force in everyday life, from the sales tax we pay when we shop, to the income tax we pay on what we earn. There is no way to escape it, without risking severe penalties like wage-garnishing and federal prison.
If you would like to invest in the only financial investment that comes with the guarantee that it can send people to prison for failure to pay, invest in government bonds, and government-backed securities. The US Treasury sells Treasury Bonds directly to consumers through brokerage firms. Also, many mutual funds will diversify into government-backed securities for the peace of mind that comes from knowing the Federal Government, who will probably be around another forty or fifty years, stands behind the investment. For investors that want the liquidity of a mutual fund, with the security of a government bond, I recommend Vanguard's Extended Duration Treasury Index Fund, available as an ETF or Mutual Fund.
I am long on Carriage Services, Service Corps International, and Stewart Enterprises, as well as the owner of government bonds through various mutual funds.