How I'd Start Investing Again as a Beginner 2024
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- Опубліковано 19 вер 2024
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This is everything I wish I had known about investing as a beginner around 10 years ago, and how I would start investing now knowing what I do now about the stock markets, how index funds work and how wealth is built over the long term. I explore all of the basics from getting yourself ready mentally, and paying off debt to then working out how to invest and what to invest in. If you can learn from my investing mistakes, you'll do really well and a lot better than I did from when I started!
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100 percent agree... Keep majority going into regular payments in index funds. It doesn't matter whether its monthly or yearly... Except psychologically doing it monthly gives you something TO DO!
And also buy some individual stocks to have some fun and challenge yourself.
Most investors biggest battle is with their need to be 'doing something'...
ETFs or Mutual Funds?
When my favorite products go on sale, I rejoice and buy. When they go for steep discounts (50% off or more), I stock up! Treat bear markets the same. Bear markets are like major holiday sales events that allow you to buy your favorite stocks at discounted prices, oftentimes at heavily discounted prices!
Financial peace isn't the acquisition of stuff. It's learning to live on less than you make, so you can give money back and have money to invest. You can't win until you do this. --Dave Ramsey...
Been watching you for a long time , I value your opinion greatly
The don't rush advice is interesting but something which I did. Anyone can throw their money away on something they don't understand. Becoming informed takes time. I spent 2 years (whilst at uni) reading about investing, then focussing on passive investing. It meant when I graduated into a good job I could start investing in my S&S ISA. Fast forward several years and I've cashed most of that out to buy my house.
I like the last bit. I am looking at £650k in my isas and £1m in my pension by 60. I need to remind my self that I will have a paid for house by then and I also need to enjoy life now. I dont care about cars. I could lease a very nice bmw of I wanted, but instead I bat around in an old Toyota. I do love my mountain bikes though, and while I am still young I need to have money to enjoy my hobbies and interests. No point looking back with loads of money at 60 and thinking 'i should have spent more on fun when I was younger'.
Electric mountain bike purchase here you come - I've heard they're a lot of fun :). Great comment Jonathan wise words indeed!
@@TobyNewbatt you read my mind. Although e-bikers are not real mountain bikers. Its cheating.
I wish I had understood the wisdom of the "Boglehead 3 fund portfolio" in my 20s. My portfolio is a bit of a complicated mess, and I missed out on some good returns by attempting to get great returns.
I recently inherited quite a large sum that I don't know what to do with so videos like this are incredibly helpful in my effort to fast track my financial education.
Having this much to set aside to compound while I'm still young isn't an opportunity I'm going to have twice so I want to make the most of it.
Thanks for watching!!
It is better to invest now. You will never be younger than you are today and there will never be a perfect time to invest. Due to compounding, which Einstein called the 8th wonder of the world, you can get rich slowly from investing if you do it from a young enough age.
So far, I'm liking the idea of buying companies that I use and already spend money with. My phone and internet companies, companies that sell materials to the company I work at, stuff like that. Buying a single share in each of these companies at a time. Then putting half what's left into various savings accounts dedicated to various aspects of my life, such as clothes, medical, food, pets, rent, things like that. Then taking what's left over and buying an index fund for half of whatever amount of money I have left to invest with over the month. That way I'll always have some amount of cash to buy extra in the event of a bigger dip.
Using the 2:1 method is really helpful with saving as well. Whatever you're looking to buy, make sure you can afford at least 2 of that item before buying even 1. It's a very simple way of budgeting. I personally also set aside money specifically for food and pets for the month and I don't reallocate whatever is left over. That way it builds up over time and I can buy something a little fancier to eat for the Mrs every now and again
Hi I've got only small amounts to invest per month maybe £50 would you suggest to just do the index funds every month and build it up like that ?
100%
Charles Stanley Direct offers a S&S ISA which allows you to regularly invest from £50/month
Great Video, covers all the basic approaches to good money management
My late goal is to have monthly income of $5000+ a month in dividend income. Beginner goal is to start off with getting a small monthly income, quarterly income, etc. After that, expand in what i invest in. Any advice in what program it use to start off with? There are so many applications and places to use, but is there something that fits the above goals?
Hi Toby, thanks for the video. Very informative and to the point. Just a quick question- stocks & shares ISA allow me to invest up to £20k if want to invest another £20k how and what would you suggest?
Hey Alan, a couple of options 1, you could think about a SIPP as this could be a good way to invest for your future and the government will top you up with free money. or 2. you can just invest in a taxable account which just means you need to keep an eye on capital gains and dividends.
That would be my thoughts but all up to you :)
Where does one go to invest ? Like website app and so on?
Check out my channel I did a whole guide and some suggestions
@@TobyNewbatt any chance you can tag the video ? I just took a quick browse but can’t tell what video it is
Can you do this but with consideration of the new the FedNow system
So if I stopped my direct debits and didn’t invest for a while can I just leave the funds I have already sitting in there to grow/fall over time
How much lower can the stock market go!?
There’s talk of a 5% drop in America if CPI numbers come in hot on Thursday!
@@murray5629 would not surprise me Murray! Certainly been some pain over the past few weeks. Would have never imagined some of the prices we’ve got now.
The great thing about being invested in Index funds is the lack of stress. I am more than happy to keep dollar cost averaging into them through this current period.
It’s certainly a lot less stressful than some portfolios that you can see on UA-cam! Doesn’t mean we can’t lose money and see ourselves in the red, but removing that mental stress is priceless in my view
Great quality - what camera do you use to record your videos please? tks
iPhone 7 and a clip on microphone….only
Kidding I use the Sony FX30 have used the Sony A7 III in older videos. Sigma 16mm f1.4 lens for these shots
@@TobyNewbatt amazing!! Thank you!!
if you had some extra funds (60k) what would you do with it with a goal of paying off a mortgage of 230k? you mentioned investing majority into index funds, what ratio would you put into index funds and what other investments would you make stocks and shares?
In a different video he said split your money 90/10 which was 90% into an index e.g. sandp500/ftse100. Then invest the 10%into an emerging market fund.
100% into a global index fund. That will have a small amount of emerging markets in there anyway
@@Jam3s22 I definitely wouldn't agree with that split for someone in the UK the currency risk is way too high.
Great video, insightful for the newbie. If I had to start over again I would not change the foundation of my portfolio which was $10K worth of VTi - this has protected me from mayhem since day 1 and from there I went ahead to build positions with individual stocks but the mistake was spreading myself too thin.. To this day from 2018-2019 I am still working on trimming down my portfolio!
Hello Toby, good morning. What Sipp provider would you recommend? AJ Bell? Vanguard? HL? Hoping for your response. Have a blessed day mate.
Hi Rocky, personally I use Vanguard for my SIPP, and I share my entire portfolio publicly. I used to use HL and moved from them a few months back.
Thanks Toby. I'm quite torn between these providers. I am considering Vanguard because of the low fees but I can only invest in their available funds. Can I ask another question? Is it necessary for me to open stocks and share isa but I'm only a beginner? I don't have large amounts of money to invest and I am pondering about the idea of management fees when you open a stocks and shares isa.
@@rockystoney2021 You don't have to use an ISA if you don't want it it's totally up to you. They are just great long term to build things up tax free. If you want to look at other platforms check out Trading 212, or even Invest Engine for ETFs. Both have free accounts and free ISAs too
@@TobyNewbatt Thanks mate.
Could you please clarify: in your other video 'index fund investing won't make you millions' you say that after 30 years index funds wouldnt yield that much return. Why do you mainly invest in them? Thanks :)
Hey Sam, that was not the purpose of that video at all :)
Index funds are the core of my investing portfolio and will remain that way as they should be for the majority of people. The purpose of the video was to show there is no get rich quick in investing and you need to be disciplined over many years, and you wont be some magic millionaire that other people try and suggest that you will be. I hope that helps
@@TobyNewbatt thank you Toby! so a strategy could be to focus on building cash flow through assets to increase the potential of index funds?
@@SJFord Kind of, ultimately the bigger impact you can have with investing is putting more in, and doing it over a much greater period of time. So I guess if you can increase your income and cash flows this will allow you to invest more of your money. But the expectation with investing should always remain long term otherwise you are just gambling on short-term price movements. Like al investing nothing is guaranteed, an index fund promises nothing, just market returns and sometimes they are good othertimes negative. Long term is where it's at.
@@TobyNewbatt Thank you, much appreciated
Another great video mate - glad to see your subscriber count is growing.
We’re getting there thanks for the support!
when you say index fund do you mean (include) ETFs?
Yep absolutely. Index funds can be either a mutual fund or an ETF.
Hello, i am new to investing, anyone have some premade plans? Or know a broker with good returns?
look up Dodai Neil online he is a great investment manager, do your research you should be able to reach him easily
Hi Mr Toby, I still have not invested in anything. I'm not convinced for the case for index funds, I know very little about them, an index has a lot of stocks or companies or markets inside it that it is nigh on impossible to understand it a little or fully let alone keep track of a market in an index fund. I think there's too much diversity in any fund that I can't understand or know enough about it to seriously consider regularly investing in one. I think diversity is an insurance policy for the ignorant and I've never been one to invest in anything that is outside my circle of competence. Personally I am more confident in investing in individual stocks than in putting blind faith into one index fund whose portfolio is so diverse as to nullify risk at the price of growth. Mr Toby what do you think of dividend kings as opposed to index funds for investing in?
You can try to beat the market 1 year, but doing it for more than 10? I think you'll be way better investing in the Sp500 or VYM for dividends and some growth.
Go for it. Check the statistic of how unlikely you are to beat funds
I wish I had this video when I started, thanks Toby!
We’re all still learning but I’ll try and pass on as much as I can 👍
Really good advice Toby.
Sticking with ETF's as a new investor is the smart way to go. In time, and if you want to, looking into individual companies can be a good move but you need discipline especially in a bear market.
I don't think you ever stop learning as I am almost 23 years into playing this game and still question some of my recent decisions!!
That’s the way forward I think Matt! Otherwise too many people end up getting into options/ CFD trading or even forex as their first start into investing and we all know where that tends to lead.
I've had $15000 in index funds for almost 2 years now and I've made barely anything.
You’re looking at it all wrong. 2 years ofc you’re not gonna make that much. It should be long term like at least 10 years
@@citooi But it goes up by about $400 one week and down by about the same the next. It's just a constant up and down for 2 years straight.
That compounding subscriber growth is about to hit 10k, well done Britains Andrei Jikh!
👊😁 a really nice milestone to hit…nearly there!
I'm envious that you guys can invest in an ISA. Over here in Ireland our investments can be taxed quite heavily. Stocks are a bit better, but I would prefer ETFs because they are easier to invest in.
We're pretty lucky it's a large amount for tax free investing and really pays off in the end!
Just get yourself a UK address and bank account and you're all set for an isa
@@bluegtturbonot that simple anymore since Brexit.
You'll need proof of address as tax resistant & UK phone number.
Nice info, what is you’re best index fund you use?
Check my portfolio updates but mostly I’m in the S&P 500, VUSA ETF 👍
Starting in early 2021 was poor timing but that wouldn’t be too much of an issue with time in the market. However starting at just over 50 I feel I’ve missed the boat on that proper time in the market.
Do enjoy it though the challenge even though everything is now a sea of red after Lloyds finally joined the red club.
Index funds totally agree with you though one thing I have done is only start buying S&P 500 this year not last year so not as much in the red so far with that. How much further markets will drop we will see but defo further falls to come you would think for a while yet.
Totally understand Andrew, it's a tricky time right now if your time horizons are shorter, but saying that you've still got decades, meet me back here in the comments section when you're 90 :P
Who is your broker please:
I use, Trading 212, InvestEngine and Vangaurd
But with index funds do you own stock or derivatives? If it’s the latter then technically you own nothing and could find yourself in a bubble.
In fact the way things are going you almost certainly would be in a bubble.
And we know what happens to bubbles.
A direct debit leaves our acc every month to stocks and shares ETFs, watching the nose dive the market is in makes selling a panic move, we have more years to be saving so we aren’t cashing in a realising a loss.
great attitude Birdie :)
I'm adding to SDR, RKT & Diageo next.
Long term I do think there are some bargains to be had right now at these prices.
Really great content mate. Thank you
Cheers Thomas!
is it better to have an index fund rather than etf? whats the difference between the two?
Hey Russell, an ETF or a mutual fund or BOTH kinds of index funds :). So the question is more about whether you want an ETF or a mutual fund, pros and cons for both I did a video a few weeks back :)
@@TobyNewbatt thanks
What were the books that you briefly showed in this video?
I'm only a couple of months into investing and found Rich Dad Poor Dad a great read.
Thanks.
Hey Ste. The two I mentioned are John Bogles little red investing book and then Morgan Housels - The psychology of money
Great little video 😊
Cheers :)
Great video mate, cheers
Cheers buddy!
Great videos mate! Loving your channel!
Thanks Nick!
John Bogle
Daddy as I call him
Hi Toby, on vanguard site for a isa it says £100 per month or £500 lump sum minimum. How does it work do you have to direct debit 100 a month to that account 🤔
hey, direct debit is the £100 a month no? I'm confused there shouldn't be an issue. The £100 a month trumps the £500 lump sum, which they mean a one off payment, does that help?
@@TobyNewbatt sorry I should of explained a bit better. If I wanted to invest less than 100 a month I'd have to do the lump sum wouldn't I?
@@originallifeclothing4038 yes in theory but I’ve read a few places that you could still make smaller orders on Vanguard than what they technically write…maybe try and see if it goes through lower
@@TobyNewbatt ah right I see I didn't know that thanks for your help ill look into it 🙂
I keep wanting to start index funds but the more I hear about them, they just seem like glorified pension schemes that will only be beneficial when I'm old and not able to enjoy life, either that or I'll already be dead.
Then you need to read more, as you clearly do not understand them.
If your on the Wirral and your boilers broke let me know I'll fix it 👍
Just had mine serviced in Manchester mate but I’ll let you know 😂
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I finally decided to do the responsible thing and buy in at the end of 2021, right at the peak of the market and only in "safe" index funds. Now I'm down 20% for the year. It's nice to get immediately punished for doing what you're supposed to be doing.
It’s always painful Neal and you’ll think you’ve had the worse luck but as more time passes and you average in you’ll keep getting better!
@@TobyNewbatt I'm staying in it, and dollar cost averaging at a low level, but this is still painful.
@@TobyNewbatt case in point.
@@Huxley350 I’m not sure how this is case in point? Neither of us know Neals risk tolerance, and every asset class has suffered losses this years including bonds. Reminds me of Peter Lynch when he says that every time the market went down he also went down with it.
@@nealjohnson1500 I started seriously last month, but if you look at the stock market history, it's always been an up and down roller-coaster. I'm sticking with it though cause in 5-10 years when it's booming I'll be kicking myself for not investing, kinda like I am right now for not investing when I was in my 20's lol. I'm investing for dividends in 3 etf's to supplement my roth ira when I'm approaching 60. Hoping between me and my wife investing in these 3 etf's we can retire before we're 60.
That recent bull run was all that free printed covid money going into the market making a bubble.
Things got crazy!
I count myself successful in trading with the help of my broker who manage and handle my trading account and get me awesome profits. Her new strategies are magic and i can unequivocally say that trading is one of the most profitable and lucrative business for every investors with the right expert.
Trading is very profitable with the help of a seasoned broker managing your trading account
Investing in Assets is the cheat code for having a successful financial life.
To avoid making losses while trading, you need to get full understanding and knowledge of trading and holding
@@francisrod376 You're right.. most time having knowledge or insight about a particular activity can as well be a pleasing exercise.
That's true, most people today have been having a lot of failures in trading sector because of bad platform and poor orientation.
This video is the same as every single other investing for beginners video in that it completely ignores people risk tolerance... If you are a genuine beginner, there is absolutely no way you should be invested in 100% equity. The single greatest way to success is time in the market, and the single greatest way to stay in the market is to invest towards a risk level suitable for your capacity for loss and overall attitude towards risk. If you're reading this comment, and you are genuinely a complete beginner, please do not just buy stock market index tracking funds.
Hey Josh great comment and excellent point. I’ve done hundreds of videos on my channel on all kinds of topics within investing and often speak about risk and for individuals to find a portfolio that works for them.
There’s no way in a single video to cover every possible scenario and every topic, so we take things step by step. The majority of the UK audience that watched my videos have never invested before or very new and there’s not enough information to help people even know where to start.
It’s much more important to talk about investing and spreading as much information as possible otherwise it will be left to a small elite. Cheers 👍
I’m more worried about index funds going through a bubble.
And I think that bubble will burst soon. Or. Is in the process of bursting
@@truejungli8507 I did a video on this specific subject as I’m very interest in the data surround an index fund bubble and there are certainly some merits. But in my opinion avoiding the use of index funds would then put you in a difficult situation of picking stocks which then puts you in a very tough position and most people have no interest in doing it. There will always be a active market for stock picking to help set prices and provide liquidity and if anything the active managers should love it even more and find better alpha as more people head to a passive approach 👍
@@TobyNewbatt My concern is that by not discussing what is the most important aspect of being a new investor - risk - we are liable to discourage or taint peoples views on how to invest when they inevitably get into something they are uncomfortable with. 100% equity based holdings = potential 50% drawdown.... no new investor would tolerate that.
@@truejungli8507 it's important to differentiate the funds themselves and the underlying index, but as it goes I actually happen to agree with you. Passive is great in theory, and I hope it continues to work, however I have read a lot of academics who believe its something of a flawed theory. But for now, it's ok.
Hi Toby. The lightyear app has stopped the free currency conversion deal under £3000. Id like to invest in companies like alphabet while they are at lower prices, but with exchange rates as they are and paying a conversion fee would you say its worth it ?
I agree about keeping things simple and see google has always outperformed the S&P. Does this not make you want to invest more in them as surely they are a reasonably safe bet.
Hi James, I still think there are some bargains out there in the US market even with the exchange rates the way they are but just factor that in to your own projections, and plans.
That said, yes Lightyear now charges 0.35% for FX fees, Trading 212 is 0.15% in case you wanted to try them too.
I personally think Google is undervalued and I'd be buying more for a long term hold, I already have a decent amount between my portfolios. But I have based this on my own growth assumptions, profit assumptions and discount rate.
@@TobyNewbattthanks. 1) I was looking too short sighted. If looking long term with the possibility the $ continues to strenghen against the £, I guess that scenario would add profit to any eventual cashing in of shares and return of currency back to the uk.
2)Am i right in thinking that for example currency may fluctuate by 10-30% in 10 years and even if in the wrong direction this should be outweighed by the potential much higher share price returns from these companies if all goes well
@@jameshudgell6800 long term you’d hope things average out. And every contribution you make will be at a different exchange rate which could either be a good rate or a bad rate at any given time. Once you need to sell and drawdown the cash then of course you’ll want to get lucky but again you wouldn’t be taking it all out at once. It’s all about balance here and personally I wouldn’t try and time the market
Great video Toby, what other apps do you use to monitor your funds and dividends besides T212, I’m using Stock Events but it only allows around 10 stocks to track then you have to subscribe to premium. Found your channel tonight and I’m really glad I did 👌👏🏻