Buy Stocks You Want to Own
Legendary investor Warren Buffett said it best... "Buy into a company because you want to own it, not because you want the stock to go up."
In my experience, a lot of investors make this mistake. They treat stock ownership like a bet. Really, it's an ownership stake in an operating business.
If you were buying a whole company, you wouldn't buy a semiconductor maker if you didn't know the difference between a transistor and a microprocessor, right? Well, that hasn't stopped many investors from doing exactly that.
I see it all the time... Folks buy certain stocks even though they don't have a clue what the company does or understand the industry dynamics in which the company competes. And that's where you can get into trouble.
Some of the best investments are stocks that you can easily understand and even check up on frequently every day.
For example, on your way to work, you notice that the drive-thru line at McDonald's is always jam-packed and there's barely any room to sit down inside. You look across the street and see the parking lot for your town's local restaurant is empty.
It doesn't take a master's degree to see that McDonald's is doing just fine. Using your everyday experiences to help you decide which businesses you want to own is powerful. I do it all the time when I travel the country.
So, the next time you go to buy a stock, think about what it is you're buying. Ask yourself:
- Is this company going to be around in another 20 years?
- How many people in my life use its product or service?
- What advantage does it have over its competitors?
- Are there long lines at its stores every day?
Once you find the right company you want to own, that's where the real work begins...
Because then you have to determine when to buy the stock. Even the best companies can be lousy investments if you overpay for them.
Luckily, our corporate affiliate TradeSmith has new technology to help you with this tricky task.
Through 33 years of back testing, TradeSmith has developed a breakthrough system to tell you when a stock is most likely to soar.
All you have to do is type in a ticker to get that specific stock's "green date" – meaning when you should buy it, according to historical data. Boasting an overall success rate of 83%, this technology is worth giving a try today. When you combine this tool's predictions with your gut instinct about a company you know and understand, you've likely found a big winner.
Now, let's get to this week's Q&A... And as always, keep sending your comments, questions, and topic suggestions to feedback@healthandwealthbulletin.com. My team and I read every e-mail.
A New Tax Break for Seniors
Q: Doc, I enjoyed reading about all the pertinent parts of the new tax law that would definitely help reduce our taxes as a senior married couple.
A lot of good information about deductions also, but I was surprised that you didn't say anything about the new Social Security tax provision for seniors allowing them to deduct their S.S. tax when filing their yearly tax return. Still a great article though. – K.S.
A: We're glad you found last Friday's issue helpful, K.S. We did include information about a special deduction for seniors (but it was a long issue with lots of information, so it might have gotten buried).
But some people are still confused about what President Donald Trump's "Big Beautiful Bill" means for folks receiving Social Security. Plenty of headlines have suggested that taxes on Social Security were eliminated.
That's false.
The law doesn't eliminate tax. Instead, it temporarily provides an additional deduction for seniors. As we wrote last week:
The standard deduction will increase to $15,750 for single filers and $31,500 for joint filers in 2026...
Seniors will get an extra deduction of $6,000 for individuals and $12,000 for couples. This deduction starts to phase out for individuals earning more than $75,000 ($150,000 for couples). The bill applies this deduction through 2028, at which point it would expire if Congress doesn't pass an extension.
According to a report from the Council of Economic Advisers, an agency within the White House, that deduction (when combined with the standard deduction) will be enough for 88% of seniors to pay no tax on their Social Security benefits.
You're still getting taxed on your benefits. But you'll have an extra deduction come next year's tax time.
What We're Reading...
- Did you miss it? Why my college beer money went to a vegetable maker.
- Something different: You could have bought a piece of Mars for just $5.3 million.
Here's to our health, wealth, and a great retirement,
Dr. David Eifrig and the Health & Wealth Bulletin Research Team
July 18, 2025