Most important take away

Private assets are likely to deliver worse returns than US residential real estate over the next five years. Private equity exits (IPOs) have dried up, valuations are likely overstated, and investors are growing impatient — with over a trillion dollars in PE assets held longer than seven years. Housing, while overpriced relative to incomes, is more likely to stagnate than crash due to seller psychology and entrenched political factors.

Chapter Summaries

Private Assets vs. US Residential Real Estate (Opening Debate) Ben and guest Nick Majulis debate which asset class will perform worse over the next five years. Nick leans against private assets, citing limited redemptions, assets trading at 40 cents on the dollar, and no IPO exits. Housing is overpriced relative to incomes but unlikely to crash because homeowners refuse to sell at a loss. The rent-vs-buy gap in expensive cities is historically wide, making renting the better financial choice in many markets. The savings difference from renting should go into the stock market.

Buy, Borrow, Die Strategy A listener asks about the buy-borrow-die tax strategy. The approach: buy appreciating assets, borrow against them instead of selling (avoiding capital gains taxes), and upon death heirs receive a stepped-up cost basis. This strategy only works for very wealthy individuals (top 1-5%). The biggest risk is a margin call if you borrow too much — cap borrowing at 15-25% of portfolio value. It only works with taxable accounts, not IRAs.

Guaranteed 7.25% Return for 30 Years A 43-year-old public sector worker has a one-time option to switch into a plan offering a guaranteed 7.25% annual return for 27 years. Ben and Nick agree it sounds almost too good to be true. The critical concern is counterparty/solvency risk — can the plan actually sustain 7.25% through all market conditions? If legitimate, it could allow the investor to take more risk elsewhere. They recommend having a lawyer review the plan documents and monitoring funded status annually.

Solo 401K vs. Brokerage Account A 37-year-old sole proprietor with twins asks whether to convert her traditional IRA to a solo 401K or invest more in a joint brokerage account. The solo 401K contribution limit is $72,000 in 2026 vs. $24,500 for a regular 401K. Ben recommends setting up the solo 401K (no downside) and gradually building the brokerage account with excess income for more flexibility, especially if early retirement is a goal.

529 Plans in the AI Era A listener questions whether 529 plans make sense when AI may transform education. Ben argues that despite AI tutors becoming available, the college experience — networking, social development, independence — will become more valuable in a digital world. AI may actually revive liberal arts education by making rote learning obsolete, shifting focus to creativity, communication, and broad knowledge.

Bonus: Handling a 40% Loss in a Software Stock Ben’s practical test for holding a losing position: would you buy more at this price? If not, why hold? Waiting to break even before selling is one of the biggest mistakes investors make.

Summary

• Private assets are the worse bet over the next 5 years. No IPO exits, over $1 trillion in PE assets held 7+ years, and VC fund IRRs keep declining. Housing will likely stagnate rather than crash.
• Rent vs. buy: In expensive coastal cities, renting is clearly better financially. Invest the savings difference in the stock market. Use a rent-vs-buy calculator (Nick has one on his site). A trend may emerge of millennials renting primary residences while buying cheaper vacation properties.
• Buy, borrow, die is a powerful tax strategy but only viable for the very wealthy. Borrow no more than 15-25% of portfolio value. Only works in taxable accounts.
• A guaranteed 7.25% return is extraordinary if real — verify solvency, have a lawyer review it, and monitor funded status yearly. If legitimate, it allows you to take more risk in other accounts.
• Solo 401K: Set it up if you’re a sole proprietor — $72,000 contribution limit in 2026. Gradually shift excess income to a brokerage account for pre-retirement flexibility.
• 529 plans are still worth it. College as a social and networking experience will become more important as the world goes more digital. AI will enhance education, not replace the college experience.
• Stocks mentioned: No specific stock tickers were named, though a “finance-related software stock” down 40% was discussed without identification.
• Key investing rule for losers: If you wouldn’t buy more of a stock at its current price, you shouldn’t hold it. Waiting for breakeven is a costly behavioral mistake.