How to Invest for Beginners (2024)

Summary

This video script serves as a comprehensive guide for beginners interested in investing. It covers the basics of investing, the rationale behind it, and dispels common fears. The speaker advocates for investing in index funds like the S&P 500 for long-term growth, while also introducing the concept of 'fast lane' investing, which involves investing in oneself or one's business for potentially higher returns. The script emphasizes the importance of understanding the market and making informed decisions, suggesting that self-investment can be a powerful strategy for wealth creation.

Takeaways

• 💡 Investing is about putting your money to work to earn more, combating the loss of purchasing power due to inflation.
• 🏦 The two main ways to grow investments are through rental income or selling the asset for a higher price later on.
• 📈 Stocks and shares are accessible investment options for the average person, providing potential for capital appreciation and dividend income.
• 🤔 For beginners, the fear of losing money is common, but historically, markets have trended upwards over the long term.
• 📊 Index funds offer a way to invest in a broad market segment, like the S&P 500, reducing the risk of individual stock picking.
• 💼 Warren Buffett suggests that most people should invest in index funds rather than trying to pick individual stocks.
• 🏆 Investing in an index fund allows you to own a diversified piece of the market, spreading risk across many top companies.
• 🚀 Fast lane investing involves investing in yourself or your own business, which can potentially yield higher returns than traditional investments.
• 💼 The slow lane to wealth involves steady, long-term investment in index funds, while the fast lane might include entrepreneurship or skill enhancement.
• 💰 The key to successful investing is understanding the different options available and choosing the approach that aligns with your financial goals and risk tolerance.
• 📚 Education in investing and personal finance can be a valuable investment, helping individuals make informed decisions about their money.

Q & A

What is the main purpose of investing money according to the script?

The main purpose of investing money is to enable your money to make more money over time, thus growing wealth and combating the effects of inflation.

What is inflation and why is it a concern for someone who has saved money?

Inflation is the rate at which the general level of prices for goods and services is rising, and subsequently, the purchasing power of currency is falling. It's a concern because it erodes the purchasing power of money over time, meaning the same amount of money will buy less in the future compared to the present.

What are the two general ways in which an investment can make you money?

The two general ways are: receiving rental income or dividends from the investment, and selling the investment at a higher price than the purchase price, realizing a capital gain.

Why does the script suggest investing in stocks and shares for beginners?

Stocks and shares are suggested for beginners because they are a common and relatively accessible form of investment that does not require large amounts of money, and they are less risky compared to other investments like crypto or fine art.

What is the concept of an index fund and why is it recommended for most investors?

An index fund is a type of mutual fund with a portfolio constructed to match or track the components of a financial market index, like the S&P 500. It is recommended because it offers diversification and reduces the risk of individual stock picking, allowing investors to earn returns that track the overall market.

What is a dividend and how does it relate to stock investments?

A dividend is a payment made by a corporation to its shareholders, usually as a distribution of profits. In the context of stock investments, dividends provide a way for investors to earn income from their shares, in addition to potential capital gains from an increase in the stock's value.

According to the script, what is the general advice for beginners when it comes to picking stocks?

The script advises beginners against trying to pick individual stocks unless they are financial professionals. Instead, it suggests investing in an index fund to benefit from the overall market growth without the need for extensive stock-picking knowledge.

What is the S&P 500 and how does it relate to index funds?

The S&P 500 is a stock market index that measures the performance of the 500 largest companies listed on stock exchanges in the U.S. It is related to index funds as it is tracked by certain index funds, allowing investors to invest in a diversified basket of these top companies.

What is the 'fast lane' investing approach mentioned in the script and how does it differ from traditional investing?

The 'fast lane' investing approach involves investing in oneself or in one's own business with the aim of achieving higher returns than traditional investments like the S&P 500. It is more entrepreneurial and focuses on creating value through personal skills or business growth, rather than investing in existing companies.

What are some common fears and concerns about investing mentioned in the script, and how are they addressed?

Some common fears include the potential loss of investment due to market downturns or the investment becoming worthless. The script addresses these by explaining the long-term growth trend of the stock market and the importance of holding investments through market fluctuations to benefit from compound interest over time.

What is the script's stance on investing in crypto as a form of wealth building?

The script presents a cautious stance on investing in crypto, suggesting it should only be done with money one can afford to lose due to its high-risk nature. It contrasts this with investing in stock market index funds, which are presented as a more stable and historically reliable method for wealth building.

Outlines

00:00

💼 Introduction to Investing for Beginners

This paragraph introduces the concept of investing for beginners, outlining various investment options such as stocks, bonds, real estate, and more. It emphasizes the fear of potential loss and introduces 'The Ultimate Guide to Investing For Beginners' as a resource to address these concerns. The guide is structured into four parts: the basics and philosophy of investing, the rationale for investing in stocks and shares, common fears and questions about investing, and an alternative approach known as 'fast lane investing'. The importance of investing to combat inflation and the idea of money growing on its own are highlighted, setting the stage for a deeper dive into investment strategies.

05:01

📈 Understanding Stocks, Shares, and the Philosophy of Investing

The second paragraph delves into the specifics of investing in stocks and shares, explaining the concept of buying a percentage ownership in a company and the potential for profit through capital gains and dividends. It discusses the challenges of stock picking and the Warren Buffett-endorsed strategy of investing in index funds, which provide diversification and reduce the risk associated with individual stock selection. The S&P 500 index fund is presented as an example, illustrating how it represents a basket of the top 500 U.S. companies, thereby allowing investors to track the overall performance of the market with less effort and expertise than picking individual stocks.

10:03

🤔 Common Concerns and How to Start Investing

This paragraph addresses common fears and concerns about investing, particularly the risk of losing money due to market fluctuations. It reassures viewers that while temporary downturns can occur, the historical trend shows that markets generally rise over time, emphasizing the importance of a long-term perspective. The paragraph also discusses the misconception that investing requires a significant amount of money, clarifying that even small amounts can be invested through various platforms. It provides examples of investment apps and the benefits they offer, such as practice investing with virtual money and the ability to copy investment strategies from experienced investors.

15:03

🚀 Fast Lane Investing: Beyond Traditional Methods

The fourth paragraph introduces the concept of 'fast lane investing' as an alternative to traditional, long-term investment strategies. It challenges the idea of slow wealth accumulation through methods like investing in the S&P 500 and instead promotes investing in oneself or one's own business for potentially higher returns. The paragraph suggests that by investing in personal skills or starting a business, an individual can significantly increase their earning potential and achieve wealth much faster than through traditional investment vehicles. It encourages viewers to consider their own abilities and entrepreneurial ventures as viable investment opportunities.

20:04

📚 Conclusion and Further Exploration of Fast Lane Investing

In the final paragraph, the video script concludes by summarizing the key points discussed and inviting viewers to explore the concept of fast lane investing further. It references a book review of 'The Millionaire Fast Lane' by MJ DeMarco, which advocates for a more aggressive and self-focused approach to wealth creation. The paragraph reinforces the idea that investing in oneself and one's own business can yield higher returns than traditional investment methods and encourages viewers to think creatively about their potential for financial growth.

Keywords

💡Investing

Investing refers to the allocation of money with the expectation of generating income or profit. In the context of the video, it is the primary focus, with various forms of investment being discussed, such as stocks, bonds, and real estate. The script emphasizes the importance of investing as a means to grow one's wealth over time and combat inflation.

💡Inflation

Inflation is the rate at which the general level of prices for goods and services is rising, and subsequently, the purchasing power of currency is falling. The video script uses inflation as an example to illustrate why simply saving money is not enough, as the value of money decreases over time, hence the need for investing to maintain or increase purchasing power.

💡Stocks and Shares

Stocks and shares are a form of equity ownership in a company. They represent a claim on part of the company's assets and earnings. The script explains that investing in stocks and shares can be a way to grow wealth, either through the appreciation of the stock price or through dividends paid by the company.

💡Dividends

Dividends are payments made by a corporation to its shareholders, usually as a distribution of profits. In the script, dividends are presented as a form of income that investors can receive from certain stocks, providing an example of British Telecom paying dividends to its shareholders.

💡Broker

A broker is an individual or firm that arranges transactions between a buyer and a seller. In the context of the video, a broker is necessary for an individual to purchase stocks, as one cannot directly buy shares from a company like Apple without going through this middleman.

💡Index Fund

An index fund is a type of mutual fund or exchange-traded fund (ETF) designed to follow certain preset rules to track the performance of a specific index. The script advocates for investing in index funds, such as the S&P 500, as a way for beginners to diversify their investments and mirror the performance of the market segment the index represents.

💡Warren Buffett

Warren Buffett is a renowned American investor and business tycoon known for his adherence to value investing and for his chairmanship of Berkshire Hathaway. The video script cites Buffett's advice on investing, particularly his recommendation to invest in index funds for the average person rather than trying to pick individual stocks.

💡Compound Interest

Compound interest is the interest on a loan or deposit calculated based on both the initial principal and the accumulated interest from previous periods. The script mentions Albert Einstein's famous quote about compound interest being the 'eighth wonder of the world,' highlighting its power in wealth accumulation over time through investing.

💡Fast Lane Investing

Fast Lane Investing is a term used to describe an alternative approach to wealth building, which involves investing in one's own business or skills rather than traditional financial markets. The script contrasts this with slow lane investing, such as putting money into index funds, suggesting that the potential returns can be significantly higher.

💡S&P 500

The S&P 500, or Standard & Poor's 500, is a stock market index that measures the performance of 500 large companies listed on stock exchanges in the United States. It is used in the script as an example of a broad market index fund that investors can invest in to gain exposure to a diversified selection of companies.

💡Cryptocurrency

Cryptocurrency is a digital or virtual currency that uses cryptography for security and operates independently of a central bank. The script mentions investing in crypto as a high-risk, high-reward option, noting the significant losses the speaker experienced, and advises that only money one can afford to lose should be invested in such volatile assets.

Highlights

The purpose of investing is to make your money grow and combat the effects of inflation.

Investing involves buying assets that can generate income or increase in value over time.

Common investment options include stocks, bonds, real estate, and various other asset classes.

The fear of losing hard-earned savings is a common concern for new investors.

The video is divided into four parts: basics and philosophy, investing in stocks and shares, addressing fears, and fast lane investing.

Investing in stocks and shares means owning a percentage of a company and potentially earning from price increases or dividends.

Warren Buffett recommends investing in index funds for beginners due to their diversification and lower risk.

Index funds track a market index, spreading investment across multiple companies to mitigate risk.

Investing in an index fund like the S&P 500 allows you to own a piece of the top companies in the US economy.

The historical performance of the stock market shows an overall upward trend, despite periodic downturns.

Investing in the stock market index funds is a long-term strategy that can lead to significant wealth accumulation.

The chances of losing all your money in a well-diversified index fund are extremely low.

Investing platforms like Vanguard and trading212 offer accessible entry points for new investors.

Fast lane investing involves investing in oneself or one's own business for potentially higher returns than traditional investments.

Investing in personal education or skills can significantly increase one's earning potential.

Building and growing a personal business can offer higher returns than traditional investment vehicles.

The millionaire fast lane approach emphasizes self-investment and business ownership as pathways to wealth.

Transcripts

so let's say you want to get started

with this investing thing you might have

a bit of money saved it's probably not

enough for a house but you decide you

should probably invest it in something

you could invest in stocks shares

equities government bonds corporate

bonds real estate foreign exchange

crypto nfts Futures Fine Art watches

there seems to be tons of stuff out

there and you might have even seen those

ads on YouTube from the gurus talking

about day trading and trading foreign

exchange and how you could make money in

that way through investing and on top of

all of this confusion there's the very

real fear that you might lose all of

that money that you've worked so hard to

save up so in light of all of that this

is The Ultimate Guide to Investing For

Beginners and we're going to split this

video up into four parts which are going

to be time stamped down below so you can

skip around if you feel like it part one

is going to be about the basics and the

philosophy behind investing part two is

about why and how to invest your money

in stocks and shares in part three we're

going to be addressing common fears and

questions and concerns about investing

like what if I lose all my money and

then in part four we're going to talk

about fast lane investing which is an

alternative approach to the traditional

investing thing to build wealth part one

the philosophy and the basics of

investing so let's start by talking

about what is the point investing the

point of investing is for your money to

be able to make more money so let's say

you start off with a thousand dollars

that you've saved up through your

hard-earned labor now you could put that

money under your mattress or you could

put it in a bank current account but the

problem with that is that there's this

thing called inflation that you might be

reading about on the news and so your

thousand dollars might be able to buy

you a MacBook Air right now but a few

years from now when inflation goes up

that MacBook Air is going to cost twelve

hundred dollars and so over time your

money loses its purchasing power which

is why you want to ideally invest in

something because when you invest in

something your money grows magically on

its own more on that later and that

means you can combat the effects of

inflation and that brings us to the next

question which is how does the money

magically grow in the first place and

generally the philosophy behind

investing is that you buy something now

and that something makes you more money

over time and there are two ways in

which the thing that you buy can make

you more money let's say you buy a house

it costs a certain amount of money to

buy a house right now but there's two

ways the house makes you money number

one you can rent the house out and so

you're getting rental income every month

and secondly hopefully in theory the

value of the house will also rise over

time if you hadn't bought the house and

you just had that money sitting in a

bank account and over time you're going

to be losing money because inflation is

going to eat away at your savings now

houses are an interesting example

because you get rental income and it's

very easy for us to imagine what that

looks like everyone pays rent and so

you're making money but with most other

asset classes you don't have this

equivalent of rental instead a lot of

these things you're buying and then

you're hoping that you can sell them for

a higher price over time the main

exception to this is some stocks and

shares which we're going to talk about a

little bit later in the video and these

asset classes is a long list of things

that you probably have heard of but you

might not be entirely familiar with you

know we've got stocks shares and

equities which are kind of the same

thing we've got hedge funds we've got

index funds we've got bonds government

bonds corporate bonds you might have

heard some people investing in watches

and then fine arts you've probably heard

of people investing in crypto and even

gaining Lots or losing lots in my case

or losing quite a bit of money because

crypto has crashed recently and a lot of

this can get very complicated quite

quickly and so we're going to simplify

things and for the rest of this video

we're going to talk about investing in

stocks and shares because that is the

main kind of investing that normal

people like you and me can unlock fairly

easily you don't need to have large

amounts of money which you need to

invest in a house you don't need to take

on huge amounts of risk and gambling and

stuff like you need to do with crypto

and you don't need to be an accredited

investor or anything like you need to

invest in like ancient investing

companies or all this fun stuff so

stocks and shares are kind of the basics

of investing and usually when people

talk about investing their money what

they're referring to is I want to buy

some Tesla or I want to buy some Netflix

or I want to buy some Amazon and so

we're going to talk about that part two

why and how to invest in stocks and

shares so when you're investing in

stocks and shares for example you're

basically buying a percentage ownership

in the company that you're investing in

so let's say I wanted to buy shares in

Apple for example apple is a publicly

traded company which means the public

can trade Apple stock now in a dream

world I would just be able to go to

apple.com forward slash buy and I'd be

able to buy a stock of Apple and now I

own some percentage of the company in

reality I can't do that directly I have

to go through a middleman which we call

a broker but once I've gone through this

middleman platform I now personally own

a piece of Apple now I can make money

from stocks and shares in two different

ways firstly I could make money because

I'm hoping the price of Apple or

whatever stock I've invested in is gonna

rise over time so 10 years later I could

sell it for a lot more money than I

bought it fingers crossed but the second

way in which you can make money through

stocks and shares is similar to how you

make a rental income on a house because

certain companies will pay what they

call dividends so for example in the UK

there's a company called BT British

Telecom and they pay dividends so when

you own a piece of BT you're not just

hoping that the price will rise over

time they're also literally paying out

some of the profits that the company

makes to their shareholders and so if

for example you were ridiculously rich

and you owned 20 of BT then every time

they declare a dividend which might be

every three months you would get 20 of

the profits that they are Distributing

to shareholders in reality you and me

we're probably not going to own 20 of a

huge company like that because you put

that would cost absolutely billions but

instead we might get you know ten

dollars fifteen dollars twenty dollars

like five dollars 5.47 here and there

and if we invest in lots of companies

that are paying out dividends then it

feels like you've got this free kind of

rental income but really it's profits

from these companies coming into your

account every month and that's pretty

cool so at this point okay cool you can

now buy stocks in these different

companies you can own a small percentage

offset company but how are you supposed

to choose which companies should you put

all your your money in apple or Netflix

or on Disney Plus or should you go with

a shell or British Petroleum or Ralph

Lauren or like I don't know Unilever or

you know these brands that you might be

familiar with now at this point people

have varying different opinions on the

matter but I'm gonna cite Warren

Buffett's opinion on this which is also

my opinion on this which is that if

you're a beginner to investing unless

you are legitimately a financial

professional who literally does this

full-time for a living you should not

try and pick stocks the average person

will not know enough to know which

stocks to buy they won't know enough to

know when to buy them but they don't

have to because if they can buy all of

America through an index fund because

realistically you and me we're not

really going to have an insight into oh

I reckon Apple's going to do really well

because whatever or I reckon Disney's

going to do really well because whatever

there are literally Financial

professionals whose full-time day job it

is to do that kind of analysis and even

then they don't get it right A lot of

the time and so what you can instead do

is instead of worrying about stock

picking what you should do probably not

Financial advice LOL is invest in an

index fund and that begs the question

what the hell is an index one well an

index fund is a fund and a fund is a

basket like a group of stocks and shares

or other things but stocks and shares

for example and the index component

means that this fund tracks a particular

stock market index for example in the US

there is a really famous Index Fund

called the SNP 500 and this is basically

the top 500 biggest companies in the US

and you can see here these are the

components of the S P 500 right now so

Apple makes up 6.4 percent of the S P

500 because it's big company then we've

got Microsoft Amazon alphabet which is

Google Berkshire Hathaway which is

Warren Buffett's company alphabet Class

C which is also Google Nvidia Tesla

Exxon Mobile you might be familiar with

quite a lot of these companies but if we

scroll all the way down to the 500th

company we've got I don't know Ralph

Lauren and Hasbro and didn't realize

Hasbro was in the S P 500 but you can

see that Hasbro makes up 0.21 of the S P

500 compared to Apple's 6.4 because

those companies are hugely different in

I guess market cap or valuation right so

the point of the S P 500 is that it

gives you a single number that you can

graph over time of like how value able

the U.S stock market is because to be

honest most of the value of the U.S

stock market is in these 500 companies

and so if the value of these 500

companies are slowly increasing over

time which It generally does that means

the U.S stock market is doing well and

these companies are doing well and life

is all good if for example you're in a

recession where the stock market is

going down or if for example covert has

just become a thing and the stock market

has gone down that means that

collectively people have decided that

the value of these stocks is lower than

it once was and so the graph will go

down in those moments so what does this

all mean for you and me as normal retail

investors well basically what it means

is we can invest in an index fund so

let's say I put a thousand dollars into

the S P 500 Index Fund that's very good

because it means that my thousand

dollars is now split between 500 of

these companies and crucially it's split

based on the waiting in the S P 500 so

of my 1 000 that I've just put into the

S P 500 6.4 would be in Apple stock and

so now I own 64 worth of Apple stock and

that's pretty cool I now own a bit of

Apple 5.4 of that would be Microsoft so

I now own 54 worth of Microsoft stock

and 0.015 of that is going to be Ralph

Lauren which is for 498th on the S P 500

and so I now own 14 worth of Ralph

Lauren stock now this is a very good

thing and this is what Warren Buffett

recommends my view for most people the

best thing to do is still on the S P

500. he says that hey if you had an

extra hundred thousand dollars to invest

you should just put it straight into the

S P 500 or some other big Index Fund

because over time your money is going to

track the market you're not trying to

say hey I have a crucial insight into

the market and I know that apple is

going to outperform all these other

companies instead you're thinking you

know what I'm just a normal person I

don't have time to spend 80 000 hours a

week trying to research the out of

all this stuff I'm just gonna kind of

diversify my money across all these top

500 big companies in the US I think

overall U.S companies are going to go up

over time and therefore I don't have to

think too hard about this so what's the

alternative well we talked about how you

could theoretically pick stocks yourself

so you could say you know what I'm going

to ignore the S P 500 but chances are

you are not going to beat the market

chances are unless you just get really

lucky you're not going to be real

reliably able to get the returns that

you would get by just investing in all

500 of these companies now there have

been a bunch of studies and surveys and

Warren Buffett even did a challenge

experiment thing about this that

basically show that very few funds

overall actually outperformed the S P

500 and if you've got a fund that beats

the S P 500 I.E it does better in that

year than the S P 500 did it's unlikely

to do the same the following year and so

a lot of these phones are trying to

quote beat the market but as Warren

Buffett and a lot of these other people

say you cannot beat the market so let's

just invest in the market directly just

put your money in an index fund and

don't think too hard about it every

single person I know who has invested by

picking stocks has lost money and every

single person I know who has invested by

just investing in an index fund has made

money over time the next question that

this raises is okay cool I want to

invest in a stock market index fund how

the hell do I do that do I just go on s

p 500.com forward slash buy and buy some

index funds again it's not quite how it

works you need a bit of a middleman and

that's where these kind of online

platforms come in now this is going to

vary depending on whatever country

you're in so if you want to find a

stocks and shares investment platform in

your country then just Google that in

the UK for example there are loads the

ones that I personally use are Charles

Stanley direct because that's the first

one I started using in 2015. I also use

Vanguard Vanguard is super big and super

legit you can check it out and the app

that I use personally for investing in

individual stocks these days is trading

212 and in fact incidentally this video

is now sponsored by trading212 this is

kind of fun as you can tell I'm

recording on a different day anyway if

you want to get started with investing

training212 genuinely is the app that I

use it's the best way to get started you

can trade stocks and shares you can also

open an Isa an individual savings

account if you're in the UK one of the

cool things about trading 212 is you can

practice investing with practice money

so everything about the markets is

identical it's just that you're

investing fake money rather than real

money and if you're uncomfortable

investing real money for now this is a

great way to become more familiar with

the concept of investing and then once

you're ready to invest with real money

you can just switch using a simple

button on the app and you can deposit

money through Apple pay up to two

thousand pounds and then you can use

bank transfer subsequently and the other

cool thing about trading 212 is they've

got this really cool pies feature where

basically you can look on the app and

you can see other investment pies that

other people have created so you'll have

these like Finance Pros that are

creating their custom pies and you'll

see that they've allocated 10 to the s p

or 20 to the ftse 100 or this percenter

apple or Tesla or Microsoft or whatever

and then you can see the performance of

that specific pie over time and then

what you can do if you really want to is

you can copy and paste someone's pie

that they have built into your own

investing account and now you can

automatically with a single click invest

let's say 100 pounds into that pie and

so that 100 pounds will then be split

amongst the various allocations that the

person has decided to do in the pie and

that's great like obviously I'd still

recommend investing in some broad stock

market index fund like the S P 500 even

though I don't give Financial advice

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part three common fears concerns and

questions about investing so if you're

broadly very unlikely to lose money

because Vanguard collapsed overnight but

you might lose money if the value of

your Investments goes down and this is

where people get really really worried

because they always think ah you know if

I invested my pardoned cash into these

stocks and shares what if it goes to

zero what if I lose my money now this is

a common fear and certainly let's say

you invested a thousand dollars into the

S P 500 just before the financial crash

in 2008 and then the markets crashed by

I don't know 60 or whatever it was and

so now your thousand dollars is worth

like 400 I know you're thinking oh my

God like I can't believe I've lost 60 of

my money now if at that point you sell

now you have realized the loss now

you've literally lost money because you

bought the thing for a thousand and you

sold it for 400. but if you just held on

then the market recovered over time and

by 2012 it was at the same levels and

then it was just going up and up and up

so even if you had invested lots of

money just before the 2008 financial

crisis if you had just stuck to your

guns and left that money in there you'd

be have you'd have doubled or tripled or

something your money by now because

overall the stock market broadly goes up

over a long enough time Horizon it's the

same with house prices you can buy a

house and if you try and sell it next

week then maybe the price will have gone

down but if you try and sell it 20 years

from now chances are unless your country

has been destroyed the price will have

gone up and the longer you can leave

your money in these index funds or

whatever the more it compounds over time

and as Einstein is famously put reported

to have said compound interest is the

eighth wonder of the world what are the

chances that all 500 of the biggest

companies in the US suddenly are going

to drop to zero value overnight

basically zero percent I think if all

500 of the biggest companies in the US

all have their value dropped to zero I'm

we're going to have bigger problems in

the world than the value of my stock

market portfolio and the reason why I

think it's reasonable to make the bet

that over time the stock market goes up

is because every day thousands of people

are going to work in each of these

companies every single day value is

being created by the employees at Apple

they're researching new technology

they're building new stuff they're

adding an extra camera or an extra lens

to the iPhone and all of that means that

because these people are putting in the

input of human labor you would expect

the value of the company to rise with

time because they're making more and

more cool stuff and because people are

going to want to continue to buy that

more and more of that cool stuff now

another question people sometimes have

is how much money do I need to get

started do I need to be like super rich

to start investing and the answer is no

again it depends on which platform

you're using but for example I'm trading

212 or Vanguard and Vanguard I think you

just need 100 pounds to invest trading

212 I think you can start with like 5

again this is just massively varies

depending on your country so do some

research and figure out what are the

most reputable and legit Platforms in

your country and then you can invest

based on that now there's two other

categories of stuff that I invest in I

invest in real estate so I've got a few

properties in the portfolio we're not

going to talk about that because I've

done a video about that over there

buying versus renting and that's usually

outside the range for most people until

you've already made a lot of money to be

able to afford a deposit on a house and

get a mortgage and I also invest some

amount of money in crypto yep and as we

can see here the total value of my

crypto portfolio is 200 000 but I have

actually lost 65 000 so I've put in 265k

into crypto and currently it's worth

200k what can you do I'm hoping the

price Rises with time so generally when

it comes to recommending investing in

crypto people often ask about this I

would say if you want to take the gamble

fine but make sure the only money you're

putting into your crypto account is

money that you can 100 afford to lose

don't try and think of investing in

general or crypto in particular as a get

rich quick scheme but generally if you

want to invest your money in stocks and

shares as Warren Buffett says and as I

do and as I generally recommend even

though I'm not a financial advisor not

Financial advice Etc it's pretty

reasonable to put that money in a stock

market index fund like the S P 500 for

example by the way if you're enjoying

this video so far I'd love to hear in

the comments what's been your biggest

concern about getting started with

investing what is the thing that's

holding you back part 4 fast lane

investing the alternative approach to

Building Wealth so so far we've talked

about what some people would somewhat

disparagingly called the call the slow

lane approach to Building Wealth it's

like the slow lane and this and there's

the fast lane now this is terminology

from MJ DeMarco's book of the

millionaire fast language it's actually

a really good book but the basic idea of

slow lane investing is that hey I've got

some money I'm gonna do my day job I'm

Gonna Save up 10 of my paycheck and

every month I'm gonna put 10 into my

savings account and then I'm going to

invest that money in the S P 500 and

then 50 years from now by the time I'm

65 that money will have compounded and

then I'll Be A Millionaire this is a

very very slow form of investing it's a

very slow way to build wealth and

certainly it's fine to invest in stock

market index funds I do that as well but

there is another approach to investing

and it's worth talking about that here

because when we hear investing a lot of

us just default to thinking oh I guess I

should buy stocks and shares or I guess

I need to buy a house but if we really

think about it what is the point of

investing money the point of investing

money is for your existing money to make

more money further down the line that's

all the point is the point is not to

invest in stocks and shares stocks and

shares are a vehicle by which you can

turn your money into more money further

down the line but when it comes to Fast

Lane investing fast lane investing is

basically that instead of investing in

someone else's business I.E apple or

Amazon or Google or whatever you're

investing instead in yourself and in

your own business the S P 500 goes up by

seven percent each year again on average

so if I put a thousand dollars into the

S P 500 it would be worth on average one

thousand and seventy dollars twelve

months from now and so the question

becomes can I do something better with

that thousand dollars to make more than

seventy dollars in the next 12 months

and generally the answer is hell yes

there are kind of two things I could

invest in I could invest in my own

ability to make money so for example

let's say I'm a healthcare assistant in

a hospital and I can take a course for a

hundred pounds and that course gives me

the ability to become a phlebotomist

someone who takes blood and let's say

I'm making 15 pounds an hour as a

healthcare assistant but I could be

making 25 pounds an hour as a

phlebotomist now all of a sudden I've

paid 100 pounds I've invested 100 pounds

into my own skills but I've been able to

increase my earning capacity by nearly

2X and therefore within four hours of

working as a phlebotomist I will have

paid off my hundred pound investment and

now if I work as a phlebotomist instead

of a healthcare assistant I'm now

earning more than 10 pounds an hour and

so every 10 hours of the work that I do

I'll be earning that hundred pounds back

and so my return on this hundred pounds

is way way way higher than just seven

percent because I fundamentally

increased my own value to the market

I've fundamentally increased my own

ability to make money this is why

investing in your own education is

generally a very reasonable thing to do

yes you can find out lots of stuff on

YouTube and I'm always in favor of like

hey if you're broke don't buy fancy

courses don't take out loans to buy

courses find free information on the

internet but I've got so many friends

who have an extra few thousand pounds

and they put it in the S P 500 because

they're hoping it'll grow over the next

50 years rather than just spending some

money on a weekend course on whatever

skill they want to improve and then they

can use that skill to literally make way

way more money than they would by just

sticking in the S P 500 so that's kind

of one way of Fast Lane investing you

invest in your own ability to make money

but the other way of Fast Lane investing

is by investing in your own business

obviously this only applies if you have

a business want to start a business but

generally the way to get rich quickly

quickly as in the next 10 years rather

than the next 70 years is to build your

own business to own your own business

and to increase the value of that

business rather than giving your money

to Apple or to Tesla so for example if I

wanted to I could start my own coffee

shop or my own online business or my own

YouTube channel which is a business if I

wanted to I could start my own web

design agency or social media marketing

agency if I wanted to I could learn how

to code and I could build software and I

could turn it into an app I back myself

to be able to make a business and teach

myself the basics of how to run that

business and make that business more

valuable in terms of return percentage

then the seven percent I would get in

the S P 500 and when I interviewed Alex

for Mosey who's like a 200 million

dollar entrepreneur he call he kind of

calls it in investing in the s p versus

investing in the sne it's a whole S P

500 versus SME 500 but like you will get

a significantly higher return investing

in your own ability to make make money

then you will in any any market and his

advice as well is that you should invest

in the sne you should invest in yourself

invest in your own skills invest in your

own ability to make money invest in your

own business because the Returns on that

are way more likely to be ridiculously

higher than just that crappy seven

percent that you get by investing in the

S P 500 so if for example you are

interested in investing in your own

education and you want to start a

YouTube channel and really take it

seriously and treat it like a business

you might like to check out my own

course part-time YouTuber Academy it's

great people love it it's good vibes

that'll be linked down below and that

course is basically about teaching you

the things you need to know to systemize

and scale a YouTube channel if you want

to treat it like a business it's not a

course for people who want to do it as a

hobby but if like me you want to turn

your channel into a business and make

money that way that's a course that

might help you but of course everything

is available on YouTube for free as well

so if you're broke or if you have loads

of time and not much money then of

course you can find all this information

for free on the internet anyway I hope

you found this video useful if you're

interested in learning more about this

fast lane investing approach to Building

Wealth you should check out this video

here which is my book review of the

millionaire fast lane by MJ DeMarco

which is the best book I've ever read on

how to make money in a quick fashion

quick meaning in the next 10 years

rather than the next 60 years so check

out that video over there thank you so

much for watching and I'll see you

hopefully in the next video