13 insights about Savings and Investing...
by Nick Maggiulli from JUST KEEP BUYING:
by Nick Maggiulli from JUST KEEP BUYING:
To build wealth it didn’t matter when you bought U.S. stocks, just that you bought them and kept buying them. It didn’t matter if valuations were high or low. It didn’t matter if you were in a bull market or a bear market. All that mattered was that you kept buying.
Make it a habit to invest your money like you make it a habit to pay your rent or mortgage.
Saving is for the poor and investing is for the rich.
The problem with fixed savings rate:
1. they assume that income is relatively stable over time.
2. they assume that people at all income levels have the ability to save at the same rate.
1. they assume that income is relatively stable over time.
2. they assume that people at all income levels have the ability to save at the same rate.
When we have the ability to save more, we should save more—and when we don’t, we should save less. We shouldn’t use static, unchanging rules because our finances are rarely static and unchanging.
The most consistent way to get rich is to grow your income and invest in income-producing assets.
The 2x Rule: Anytime I want to splurge on something, I have to take the same amount of money and invest it as well.
The proper approach to building wealth is to explore all of these paths in order to find what will best fit your needs.
If you want to get rich, then you need to continually buy a diverse set of income-producing assets.
When you first set up your portfolio it should be according to your target allocation (the mix of assets that you believe will reach your financial goals).
Being rich is a relative concept. Always has been and always will be. And that relativity will be present throughout your life.
This is why no one feels rich. Because it’s always easy to point at someone who is doing better. The trick is not to forget all the people who could be pointing at you.
You intuitively understand that, in some circumstances, time is worth far more than money. Because you can do some things with time that you could never do with money. In fact, with enough time you could even move mountains.
JUST KEEP BUYING is one of the most practical books on personal finance I have read in a long time. It explores truly applicable insights about savings and investing. I highly recommend reading it if you really want to learn data-based investing.
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