Russia has invaded Ukraine. Unfortunately, there’s nothing much you or I can do except give our moral and financial support to the Ukrainian people and organizations trying to help.

If you’re looking for a donation idea, check out World Central Kitchen, which is providing warm meals to Ukrainian refugees. Let us hope there is a quick end to the unnecessary bloodshed.

If you haven’t realized it by now, black swan events happen all the time. They happen so often we might as well get rid of the term altogether. Please try and adopt some humility when it comes to investing and life overall.

Financial Samurai was born out of a black swan event, the global financial crisis of 2008-2009. Therefore, this site’s DNA will always contain a cautionary strand or two. If you’ve ever lost a lot of your money and your livelihood, you will never want to repeat that experience again.

As an ongoing student of finance, here are five financial observations since the start of the war. These financial observations may help you better protect your way of life.

Like it or not, we are all bettors. To make things sound better, we like to call ourselves investors. But either way, we’re all constantly taking risks in everything we do.

The other day a Financial Samurai reader named Jim challenged me to a $5,000 bet. Surprising!

I was going to go back to Jim with a more friendly-sized bet of $100. However, after giving the wager some thought I decided what the heck. Jim said he owns a lot of warehouses and commercial property, so he most likely can easily afford the wager he offered. Further, I had conviction.

If you don’t take action by betting what you believe to be true, then what’s the point? Talking about something without any skin in the game is a waste of time.

Are you excited about a stock split? Don’t be. A stock split is simply financial engineering. Some retail investors get tricked into thinking they’re getting a better deal than they really are.

I still remember one of my VPs at Goldman making fun of an Associate one morning. The Associate excitedly shouted out to the team that a stock was on sale by 80% and that we should all buy!

Little did the Associate know the shares had just gone through a 5:1 stock split. Instead of trading at $50 a share, it was now trading at “only” $10 a share. The Associate got a good ribbing for the rest of his time at the firm.

Recently, I decided to invest in two private funds: 1) Kleiner Perkins 20 (KP20), and 2) Kleiner Perkins Select2.

KP20 is an $800 million venture fund focused on early-stage investments in enterprise, consumer, hard tech, or fintech, and healthcare companies. Select2 is a $1 billion fund that extends its core investment strategy to focus on high inflection investments across those same five areas.

Investing in these private funds does not come cheap. The management fee is 1.5% – 2.5% (fades over time) and the funds charge 20% – 30% of profits (increases after a return hurdle has been met). If you want to make a lot of money, I highly recommend being a venture capitalist!

These fees are much higher than your favorite Vanguard ETF or index fund. The average Vanguard mutual fund expense ratio is only 0.10%. Meanwhile, the industry average mutual fund expense ratio is about 0.6%.

So why invest in these private funds even though they charge much higher fees? Let me share some of my reasons. Some are obvious, while some are not so apparent.

If you invest in the stock market, you’ll eventually experience emotions of euphoria, greed, fear, uncertainty, and self-loathing. The more emotionally weak you are, the less likely you’ll enjoy investing in stocks and holding on for the long term. Losing money stinks.

Given I spent my career working in equities from 1999 – 2012, I witnessed plenty of highs and lows. From people making millions to losing it all, I’ve seen enough. And given I left in 2012, I also missed out on many good years.

Therefore, I never got the courage to go all-in on stocks after the age of 35. The volatility bummed me out. Instead, I’ve diversified my net worth into real estate, venture debt, venture capital, and alternatives, while keeping my equity exposure to 35% of net worth at most.

With so many tax-advantaged and taxable investment accounts, it may be hard to figure out the right contribution order. Between our family of four, we’ve somehow managed to open up 14 investment accounts over the years! Thankfully, technology has enabled us to keep track.

If you’re on the path to financial freedom, it’s not good enough to only contribute to a 401(k) and/or Roth IRA. You should also be contributing to a taxable brokerage account and other taxable investments.

After all, it is these taxable investments that will generate the passive income to enable you to leave work before the traditional retirement age.

Without having enough investment income to cover my basic living expenses, I probably would not have left work in 2012. Instead, I would have experienced the one more year syndrome for another five years or so.