Introduction – Stability in an Unstable World
Even though 62% of Virginia is covered with timberland, we find that the vast majority of investors today have no knowledge of the benefits timberland provides as an investment. Meanwhile, knowledgeable timberland buyers consider it to be a fantastic investment.
Our intent with this series is to provide some insight into the benefits of timberland as an investment. One significant benefit is its stability.
Bankers tell me that in our current unstable world, many folks prefer to put their money in a bank account paying less than 0.5% interest per annum because they know they will not lose it. So return of capital is obviously very important. With inflation at 2.0% those that put their money in a bank and earn 0.5% per annum are losing 1.5% per annum.
The stability of timberland is best illustrated by the fact that insurance companies buy a lot of timberland as a part of their investment portfolio. They like timberland because its stability anchors the higher risk assets in their portfolio, thereby improving the overall performance of their total portfolio.
But good portfolio management suggests that you do not want all of one type of asset in your portfolio (anyone recall Enron?). We do believe that one key to accumulating wealth is having some of your funds invested in timberland.
We hope that the information we share over the next 12 weeks will assist you in making a timberland investment. We believe doing so will make you look brilliant over the next 10 years. Call us, at Grant Massie Land Company we love to help our clients look brilliant.