I want to start by saying I am not offering financial advice. Personal finance is personal and you have to do what is best for you. This is not legal or financial advice in any shape or form. It is simply what I have researched and what is working for me.
I follow the very simple investing strategies of JL Collins laid out in his book “The Simple Path to Wealth.” He simply explains what stocks and bonds to invest in. What percentages to put them into and the mindset you need to have going in. Investing this way is not a short term incentive. This is for long term goals. I will say it again, long term goals.
First things first, you need to determine a broker. Larger brokers such as Fidelity and Vanguard seem to be the easy choice if you already have a retirement account through your employer. There are other sites that offer investing options, however, I caution you to do your research and determine what works best for you.
Next, choose your stock. I will defer to JL Collins on this. If you fear the lack of diversification in JL Collins blog or book, I recommend “Quit Like a Millionaire” by Kristy Shen and Bryce Leung. They do an excellent job of laying out several options for a diverse portfolio. What makes their advice unique, they don’t offer twenty different stocks. They offer diversified options that aren’t just in one country. They give options for diversifying outside of the United States and still remaining conservative.
Again, this is personal finance, you must consider what works for you. What can you invest in and still sleep at night.
The final step is setting up automatic drafts. Your paycheck hits, your automatic draft comes out. Make sure all of your bills are paid first, but this needs to be automatic. This amount should be the amount you were paying to debt. This should be what you’re making from your side hustle. This contribution should be consistent and not something you have to think about.
What if you don’t make the same every week or bi-weekly? Then put what you know you can do. You can always make another contribution in the month. The key is to make this something you don’t have to think about. If you can do this and walk away for a several years and then come back, you could potentially have enough to retire. To quit your job. To travel. To do whatever it is that you are passionate about. To do your why. What is your why? Go to the next post to find out.
