So many people are intrigued by creating wealth in their lifetime using the stock market. Yet, most people are not aware of the ins and outs of investing, where to start, and how to generate wealth from it so I’m here to share a bit of what I know in hopes you can start!
My number 1 tip for creating success in the stock market is this: Invest 20% of everything you earn into the entire stock market.
And then give it time.
Literally the best way to build wealth is to invest and give it time. It’s as easy as that!
Let me break that down for you a bit more.
My first piece of advice for anyone looking to invest is to remember that time will always work out for you in the long run. The key to becoming a millionaire is to invest in time and to be patient while your money multiplies. Time is always the best investment. A slow and steady pace can be tedious to maintain, but it truly is best to watch wealth be created gradually, rather than investing in riskier markets like Bitcoin, NFT, Tesla stock or anyone promising massive returns overnight (aka “get rich quick” schemes).
If you invest 20% of your total earnings into the stock market as a whole, based on past performance, your investment will be earning more than you within 20 years. Getting into the habit of trusting the bigger picture of the stock market rather than stock picking or trying to time the market will make the biggest impact on your success.
Now you might be wondering, “How do I invest in the entire stock market?” Here’s my tip: ETFs are a new way to invest in a package of stocks. They can be purchased or sold on a stock exchange the same way that a regular stock can. However, the benefit of this special type of stock is that rather than representing a single company, they can represent multiple stocks; sometimes the entire stock market. For example, you can purchase the Vanguard Total Stock Market Index Fund ETF by purchasing their stock with the symbol, VTI and with this single stock purchase, your investment will represent the entire stock market. Let me say that again. You just need to purchase this single stock to invest in the ENTIRE stock market. It’s as easy as that.
If it’s mutual funds you’re interested in, the process is the same. You can choose to opt out of stock picking and instead invest in the entire stock market with total stock mutual funds. This way you don’t have to worry about advisors figuring out what to put in the stock portfolio or what will perform best. Instead, you’re riding out the average (the highs and the lows) of the entire market.
In the long run, this tactic has outperformed any stock picking individually and has almost 100% accuracy!
It’s simple! Stop trying to pick and choose your stocks: invest in the entire market and give it time.
