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This lesson reveals a super simple way to start investing, even if you know nothing about the stock market. It involves a special type of investment that can grow your money automatically over time, with very little effort.
Should You Be Intimidated By The Stock Market?
Don't be intimidated by the stock market. Start with an index fund or small investments in companies you know well. Learn from experience and gradually expand your portfolio. The key is to start and keep growing. The journey of a thousand miles begins with a single step.
Now, $100 => $500,000 - HOW?
Making a sh*tload of money in the stock market is easy.
Don’t believe me? The S&P 500’s total return (with reinvested dividends) over the past 95 years is 9.7%, compounded annually.
Put $100/month into an S&P 500 index fund, and in 40 years, that $48,000 investment should turn into more than $500,000.
Of course, past performance is no guarantee of future results.
But look at the below chart of the S&P's returns since January 1928.
95 years includes the Great Depression, WWII, 1970s stagflation, the dot-com bubble, 9/11, the Great Financial Crisis, and the coronavirus pandemic.
I'm willing to bet the market will be much higher 40 years from now. The world's most ignorant investor could still make half a million dollars if they'd just put $100 in the market every month for 40 years. All that's required is patience and discipline.
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Complete the following exercises:
1) Analyze how the markets were before, during and after the Corona Virus Pandemic. (Hint : Look at which type of investors benefitted highly)
2) Analyze the companies in the S&P500 with an emphasis on those companies whose products you use everyday. (more exploration on why we do this in later lessons)
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QUIZ
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Leave your comments and questions below.
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