I’ve had this mental image for a long time of a new investor entering the world of investing for the first time. It’s a scary place. Day trading, MLM schemes, stocks, bonds, mutual funds, options, futures, your cousin’s new restaurant, whatever the hell forex is. How do you know which to pick?!
Well, it turns out you hear so much about those options not because they benefit you, but because they benefit the trillion dollar financial services industry who is looking to make a profit in the very lucrative business of capturing your investing dollars. It turns out, the best path to wealth is to create a direct line from a solid investment to your bank account with as much simplicity and as few fees as possible. That’s exactly what an index fund is. It’s a direct line from the growth and profits of the world’s companies back to your bank account with maximal simplicity and minimal fees.
If you’re new to investing, you probably don’t hear much about index funds. There are no Super Bowl ads. There are no commissioned insurance salesmen pushing it. There are no #bossbabes asking you to join their index fund team. Why? Because the fees are so low, nobody is getting paid for pushing it. But read a few classic books on investing and you’ll see that those who know what they’re talking about and aren’t trying to sell you anything will all tell you the same thing: Buy and hold index funds.
This post was born when I wanted to get this image out of my head and onto the screen. This was my attempt at drawing it, which as you maybe can tell, isn’t all that great. So we commissioned an artist! For US currency, not exposure. And we’ll give him the exposure too! Thank you @loubot for bringing my idea to life! Go check out the awesome art on his page!
As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.
-Jeremy
via Instagram
