Here is the essence of smart investing for beginners.
Watch and learn how to invest! (More fun than reading.) This video assumes familiarity with the Smart Investing Strategy For Beginners guide—that is also widely referred to as Boglehead Investing and as Common Sense Investing. It’s the best strategy for 98% of all investors of every age, every level. This video is just a fun recap.
Read the transcript for The ABCs of Investing For Beginners
A is for Assets: stocks, bonds and other stuff.
Don’t fret about precision, getting close — good enough.
B is for Begin, to simply get started.
That’s the surest way to achieve dreams uncharted.
C for Compounding, for growth exponential.
Accomplishes big results and often essential.
D for Diversify, stocks and bonds in your pie.
Their ratio controls risk when things go awry.
E for Emergencies that come as surprises.
A responsible person has a reserve that suffices.
F is for Frugal, not cheap or miserly.
It’s prioritizing your spending and your life energy.
G for “Get Rich Quick”. Dismiss these schemes brisk.
Beating the market comes with a big dose of risk.
H is for Harvesting, in more advanced classes.
You might sell your losers to lower your taxes.
I is for Indexing, the lowest cost way.
For you get to keep what you don’t give away.
J is for Junk bonds, their tempting yields hawked.
But in bad markets, they behave more like stocks.
K is for Knowledge, about how to invest.
It’s lifelong learning that will help you the best.
L is for Low-cost. We like this a lot.
Keep what you earn and don’t finance their yachts.
M is for Mutual funds and avoid daily trading.
We’re long-term investors and eschew speculating.
N is for Noise, it’s worth tuning out.
We’re surrounded by blowhards that financial porn spout.
O for Overconfidence, a fault many have.
Feels good ‘til a bear market, then it feels bad.
P is for Penny, and the lesson we’ve learned:
A penny that’s saved equals two pennies earned.
Q is for Qualifying, to include and weed out.
It’s quite easy to do, then get out and about.
R for Retirees, and safe withdrawal voodoo.
It’s all about making your money last longer than you do.
S is for Saving, automatic paycheck withdrawal.
What you never see, is not missed at all.
T is for Timing, from tempting purveyors.
It’s only for those that believe in soothsayers.
U for U.S. bonds, as safe as it gets.
Keep risk on the stock side, safe bonds for the rest.
V for small Value, these funds carry more risk.
But if you seek out-performance, add these to your list.
W is for Writing a workable plan not too long.
Write the best you can now; and over time make it strong.
X is for X-ray, your funds — look inside.
For consistent styles, and lack of surprise.
Y is for You. How we remember thee?
Personality is revealed how you spend your life energy.
Z is for Zen, simple peace in your niche.
To know you have enough is to be rich.
There you go! That’s the ABCs of investing for beginners. If you liked it please give it a thumbs-up and leave me a comment below.
Thanks for watching!
- Must-read guide: Smart Investing for Beginners
- Video overview of Intro: Ten Rules of Investing for Beginners
- Video overview of Step 1: Develop a workable plan.
- Video overview of Step 2: Invest early and often.
- Video overview of Step 3: Choose appropriate investment risk.
- Video overview of Step 4: Diversify.
- Video overview of Step 5: Never try to time the market.
- Video overview of Step 6: Use index funds when possible.
- Video overview of Step 7: Keep costs low.
- Video overview of Step 8: Maximize after-tax returns.
- Video overview of Step 9: Keep it simple.
- Video overview of Step 10: Stay the course.
- Video overview of The ABCs of Common Sense Investing
- Must-read guide: How To Build An All Weather Portfolio With Stocks and Bonds
- Courses at: FinancingLife Academy
Footnotes and Credits:
This video may be freely shared under the terms of this Creative Commons License (CC BY-NC-ND 2.0). with attribution to Rick Van Ness and this web page.
This work contains a collection of photographs which are either owned
by Rick Van Ness or licensed under one of these creative commons
Photo Statue of Liberty by Shinya Suzuki shown at (2:18) with license (CC BY 2.0).
Photo Income Tax Return by Chris Potter shown at (0:56) with license (CC BY 2.0).
Photo Jumping by be-younger.com shown at (2:46) with license (CC BY-NC-SA 2.0).
Photo Pennies by Jeannette E. Spaghetti shown at (1:48) with license (CC BY-NC-ND 2.0).
Photo SMYE 2010 by Gwenael Plaser shown at (2:31) with license (CC BY-NC-SA 2.0).
Photo Writing by Jeffrey James Pacres at (2:29) with license (CC BY-NC-ND 2.0).
Photo Reading by Danny Molyneux shown at (1:15) with license (CC BY-ND 2.0).
Photo Kite Flying by Mauricio Balvanera shown at (2:51)) with license (CC BY-NC-SA 2.0).
Photo Kite in the sky by Karen Blaha shown at (2:48) with license (CC BY-SA 2.0).
Casino video from andkow81 used at (0:50) under fair use.
Mad Money video from thestreet.com used at (1:35) under fair use.
The music, Get Outside! by Jason Farnham, is provided by YouTube.com.
“To know you have enough is to be rich.” This is from The Tao Te Ching.
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|Common Sense Investing: Ten Simple Rules to Finance Your Dreams