Anthony robbins book on investing
An index fund is like a collection of ALL the stocks on the market. Index funds are great because they make investing far more safe and predictable. Although individual stocks have always been risky and individual companies can always go out of business, the stock market as a whole has always gone up over the long term.
This means if you invest in every company on the market, then you are almost guaranteed that your money will grow over time. So Tony Robbins recommends we invest in index funds, which means putting an equal bit of money into every bigger stock on the market.
This ensures our money will grow over the long term. Compound Your Wealth: Your savings will grow faster through the math of compound interest How much could your money grow through index funds? Well, more than you might expect. How much would it have been worth by ? Almost a million bucks! This sounds surprising because we mostly hear the negative news about the stock market.
We hear about the crashes that happen every few years and assume the stock market is a big roller coaster. Yes, it is true there are some years when the markets crash, but in the long term those losses are more than offset by the growth during the good years.
The key is to see investing as a very long-term game. Put your money in for 10, 20, 30 years or longer. The reason investing can pay off so much in the long term is because of something called compound interest. We first have to explain what interest is. This means your past interest starts to generate its own interest.
So what happens the second year? This extra dollar is the compound interest. While the effect may sound small in this example, over decades it will make become a tremendous force. Interest is when your money grows from investing. Compound interest is when you earn interest not just from the money you saved, but also from past interest.
Mutual funds are also a collection of stocks, but a fund manager picks which individual stocks go into it. Now, in a perfect world, having a professional pick stocks for us sounds like a great idea. They usually grow our money slower than index funds, especially when the higher fees are taken into account. And you know what he found? Despite the mutual funds being run by very highly paid professional investors.
They can often make a lot more money selling these funds instead of mentioning index funds, because mutual funds make a lot of money for their company! So 10 dollars versus 30 dollars. Why are they so much cheaper? A team of highly paid bank managers are not needed to pick stocks, it can often be managed automatically through a computer.
They have lower trading fees. Every time a mutual fund buys or sells a stock, they pay a trading fee. These costs add up. On the other hand, index funds buy and hold the same stocks for years at a time, so there are far fewer trading fees. More and more people are catching on to the benefits of index funds over the currently dominant mutual funds.
Another great personal finance book is Millionaire Teacher by Andrew Hallam. He also enthusiastically promoted the benefits of index funds. One of the most useful parts of his books explains the common sales arguments for mutual funds you will hear from bank employees and financial advisors.
The big lesson is that you should be prepared and expect resistance from them if you mention index funds. Learn more in-depth investing tips in our summary of Millionaire Teacher by Andrew Hallam. Index funds usually have fees under 0. When fear takes over, people make their worst investing decisions. It happens every time. They must scare people enough so their eyes stay glued permanently on the news.
Then they sell our attention to advertisers so they can pay their mortgage. That is literally their business model. The best way to remain calm, rational and unshakeable during those market downturns is to learn history. We must learn that market corrections and crashes are a normal, predictable and inevitable part of investing. Bear markets happen every years on average. This means the next time the market goes down, it is no reason to change your investing strategy.
Because the market has always bounced back after every correction, bear market and recession. There is no reason to believe it will be different in the future. Possibly the biggest mistake beginner investors make is to sell their investments while they are going down. Fear takes over and they panic. Remember the big financial crisis of ? Investopedia Huge institutions were going bankrupt, billions of dollars were being printed for bailouts, people were losing their homes across the country.
But look at what happened next. Starting in March , the economy bounced back. Over the next 7 year, the stock market more than tripled in value, restoring all the wealth that had been lost and then shooting to new peaks. Source: Macrotrends This means the worst move someone could have made during the crisis was to sell their investments! That would have locked in those losses permanently. A good move would have been to stay invested. While the talking heads on the news are getting hysterical, intelligent investors are buying more than ever while stock prices are cheap.
A simple quote that Warren Buffet made around sums it up perfectly: A simple rule dictates my buying: be fearful when others are greedy, and be greedy when others are fearful. And most certainly, fear is now widespread. They have happened once a year on average since These happen every years on average. These market falls are normal and predictable so remain calm and stay invested. Diversify: This helps you avoid losing money while investing Diversification is having your money invested in many different types of assets.
This can help you avoid losing money because when one type of investment is doing poorly, you still have your other types of investments which can be doing well. If the US stock market goes down, then you will be in a very bad position for a few years. Instead, you should spread your savings across the US stock market, international stock markets, government bonds, real estate and more.
Most people believe top investors are obsessed with making money. After talking to many millionaires and billionaire, Tony Robbins says this is not true. He discovered the best investors are obsessed with NOT losing money. Warren Buffett even has a famous line that goes: Rule number one: never lose money. Rule number two: never forget rule number one. They help us avoid betting our money on one company.
Use many types of investments. Like a variety of stocks, bonds, real estate, etc. During most of the s the US stock market grew by just 1. Nobody really knows when the cheapest time to buy an investment is. However, if you purchase your investments over time, then you can avoid spending all your money at the most expensive time.
This is also called dollar cost averaging. Diversification is spreading your money over many types of investments, like different countries, different stock markets, bonds, real estate, etc. With this strategy, your wealth can keep growing even when one part of the economy stops. He has a special passion for small-business owners, parents and students. Being the Chairman of seven privately held companies and five holding companies in diverse industries keeps him busy.
Most of Tony's core strategies for creating breakthroughs have come from his work with some of the biggest names in the business world: He's had the privilege of modeling and distilling the strategies of leaders in some of the fastest-growing companies in the world. He's used these distinctions to help optimize and grow enterprises to new and more profitable levels. One of the things Tony is most proud of is his humanitarian work through the non-profit Anthony Robbins Foundation.
He's always believed that if we're blessed enough to have insight and economic opportunities, then we're also blessed enough to be able to give back.
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This means that you can unleash your powers to improve all the aspects in your life. In most of us, the giant is sleeping. By means of this book you will be able to awaken him. Giant Steps Many people are looking for inspiration in their lives. In our opinion, this book by Tony Robbins makes you find it.
He sets out how even the smallest actions may result in giant steps. In order to do so, he provides you with techniques, strategies and more. Unlimited Power Yes, you can do, have, achieve, and create anything you want out of life. We think that Anthony Robbins has proved it. The Path: Accelerating Your Journey to Financial Freedom Regardless of your stage of life and your current financial picture, the quest for financial freedom can indeed be conquered. The journey will demand the right tools and strategies along with the mindset of money mastery.
With decades of collective wisdom and hands-on experience, we think your ideal guides for this expedition are Peter Mallouk and Tony Robbins. The book helped so many individuals overcome the most challenging circumstances that people repeatedly asked to purchase it for themselves and for their friends. Therefore, we chose this special, updated edition containing new material in our top We think that this book will help you with this goal. It is about the basics of investing and the details are set out by, among others, Tony Robbins.
Once you have finished ready this book, you will know all about properly investing. Bogle: Well, it's all about the cost. Investing is the one business in the world where you not only don't get what you pay for, but you get what you don't pay for. I'll tell you something else you taught me—the metaphor of 1, gorillas flipping quarters.
One flips 20 heads in a row and we all think, What a lucky gorilla. But when it's in the financial business we go, What a genius. Bogle: It's actually a lot like a lottery. I can't remember how much you touched on it in your book, but one of the most powerful ideas in investing is reversion to the mean.
A fund does very well, then it does badly. A fund does very badly, then it tends to do well. Costs play a big role. To the extent that a fund is doing badly because of its costs—[annual] expense ratios, sales loads, portfolio turnover rate—it's not going to revert to the mean. It can't do it. It's stuck in the bottom. So it's reversion to the mean for the good guys, and a little reversion, but not nearly as strong, for the people who have not done a good job because of their high costs.
Robbins: The other piece that relates to that is the average investor. When they're trying to figure out what [fund to invest in], maybe they go to Morningstar [and try to look up] five-star funds, not understanding reversion to the mean. But it's just like you were talking about.
If you look at the research, out of five-star-rated funds, four are still five-stars 10 years later. People are buying at the peak. They're being sucked into doing the very opposite of what the greatest investors do. Bogle: In investing, you're better off learning from the experience of others than learning on your own [because] it's an expensive way to learn.
Robbins: Well, that's why we both write the books we write. Tell me something: What would you tell me now? Because I'm talking to a lot of people right now, and there are a lot of people very fearful that the market's valuations are extremely high, and they're extremely concerned. Bogle: Well, let me first say that waiting until the weather clears in the stock market probably means you started waiting when World War II started.
The book is excellent—and I read it before I did the endorsement. But it had, to me, a little too optimistic cast looking at past returns and things of that nature. So in my introduction, I wrote this, and I'm very glad you kept it in: "We live in an uncertain world and face not only the risks of the known unknowns but also the unknown unknowns—the ones that we don't know we don't know. Despite these risks, if we are to have any chance for meeting our long-term financial goals, invest we must.
This is the time to really emphasize risk. So it's a time for some caution. The index [fund] is not a panacea. It's participation in a risky business that eliminates the risk of individual stocks, eliminates the risk of picking managers, eliminates the risk of picking the hot sector of the day, and leaves only the risk [of] the stock market itself. But that risk is not to be disregarded. It's always been high. It always will be. Robbins: By the way, [that sense of optimism] probably comes from Warren Buffett's "Don't bet against America" mentality.
But we put in additional cautions throughout, so you know. And I'll send you—last time I sent [the book] to you, you wanted, like, 80 to copies. You want me to send you a bunch, to be able to hand out the new one as well?
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How To Become a MILLIONAIRE: Index Investing For BEGINNERS - Tony Robbins \u0026 Lewis Howes
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