You don’t have to be rich to invest - Anne Krystel - Extrait de Parfum

Pick a simple portfolio that will make you rich, pay fewer fees, and get superior performance. Automatic investing is the best way to invest in.

Automatic investing is not some revolutionary technique. It’s a simple way of investing in low-cost funds that are recommended by Nobel Laureates, billionaire investors such as Warren Buffett, and most academics. It involves spending most of your time choosing how your money will be distributed in your portfolio, then picking the investments (this actually takes the least amount of time), and finally automating your regular investments so you can sit and watch TV while growing your money.

Automatic investing may not seem as sexy as trading in hedge funds and biotech stocks, but it works a lot better. Would you rather be sexy or rich? You can reach a crossover point when your investments earn enough to fund your expenses, automatically. Then, you don’t have to work anymore. The acronym FIRE captions it best. It means Financially Independent, Retiring Early!

There are two types of FIRE! Lean Fire and Fat Fire. Lean Fire are people who have decided to live on a “lean” amount of money — $30,000 to $50,000 a year in perpetuity. Fat fire is for people who want to live an extravagant life at the highest levels of spending. For example, in 2018, Oprah Winfrey bought a house for $8 million. That seems outrageously expensive, right? Here’s the twist: Because her net worth at the time was over $4 billion if that money was even conservatively invested and returned 4%, her investments alone — not even counting her salary — would generate $160 million that year, effectively making the house “free” to her.

Action steps for Week Six :
• Figure out your investing style.
• Research your investments.
• Buy your funds.

Source: “I Will Teach You to be Rich” by Headway App