The Best and Easiest way to Invest and you can Start Today

I hung out with a bunch of friends last night for a birthday dinner and we started talking about investing. What I learned was that not that many people know or care about how money works.

The first question I ask everyone is do you have a 401k? They all say “Yes.” The second question which no one ever knows the answer to is do you know what funds is your money ? And nobody has a clue, which is really mind-boggling to me. Let’s say you’re walking down the street and you drop $20 on the floor and it flies away into a sewer hole. It’s going to hurt you (maybe a lot) but all the money that you’re losing in your 401k and other investments is okay because you don’t see it.

So much money is being lost in the form of fees and bad fund choices you don’t know because you don’t really care. It’s not in front of you so you start thinking of it as virtual money that’s being saved up but you don’t know exactly where it’s being invested, which hurts you in the long run.

Many people think the stock market to scam and I understand that. But if you know exactly how the market works you can be a part of it in the most simplest, easiest and lowest cost way.

I got married about 3 years ago and I realized then that I need to do something with my money. I need to make sure that my money makes money while I sleep. So who should I get investing advice from? I thought if anyone knows a thing or two about investing its Warren Buffet. So I went to YouTube and found this video of him talking about personal finance and the market:

Great advice and then I asked myself, what the hell is an index fund? So then I went “All In” and studied everything on investing for months from authors like:

• John Bogle
• Ric Edelman
• Dave Ramsey
• Rick Ferri
• Dan Solin

I realized investing is actually one of the simplest things a person can do on their own but Wall Street just makes it look way more complicated than it is. So what do I do now? Lets get personal. This is what I learned:

• The power of compound interest and dollar cost averaging
• The value of stocks and bonds
• The rule of 72
• Vanguard is one of the best and biggest fund companies in the world
• Index investing is the best way to put away money every week at the lowest cost
• Fees matter A LOT! A 1% fee structute can cost you hundreds of thousands down the line.
• Think long term. Be an investor not a trader.
• Differences between Roth and Traditional IRAs
• Whole life insurance is a scam for 96% of Americans (also not an investment)

So what do I do personally?

I invest a certain amount of money every week automatically into the Vanguard Total Stock Market Index Fund (It has all of stocks in the US market so you are diversified and will start getting the return of the whole market). What are my fees? Its .05%. So basically for every $10,000 I have in the fund its costs me $5 a year! That’s all folks, not a penny more. Of course, Wall Street would never want you to know this.

I also “Pay Myself First.” Just like money is automatically deducted from your paycheck to the government and medical benefits, I do the same with my investments. The money that is left over is what I spend and enjoy. I never feel guilty going out and spending a night with my wife in the city on a great Broadway show and steak dinner. I never have to because I know I am saving about 20% of my income and having it invest in the market.

A few last words… Do not be scared of the stock market. Now you can get the return of the stock market at the lowest possible cost. Investing is technically very easy as you can see, its the emotions that get in the way of making these decisions. Tune out the news on CNBC and FBN and think long term investing. Know your goals and objectives and you will do really well over 20 - 30 years! Remember:

The stock market has created the most wealth for people in the history of the world than anything else.

Now you can be a part of it as well. I encourage you to read just a little and start fixing your investment strategy. If you ever need to talk, I am here for you.

Manpreet Jassal

P.S. I do think Vanguard is the best place to invest. I will leave you with John Bogle talking about it, the last minute is the best part!