3 Investments To Own for Life - Minimalist Money

minimalism has penetrated our culture originally born out of the streets of New York City and started in the late 1960s it came from the visual arts and music mediums it gradually evolved to mean more than just a simple taste in art and it became a way of thinking about life decades later now we have dozens of books documentaries and even YouTube channels dedicated to preaching about the Gospels of minimalism and how it's supposed to improve our life minimalism is supposed to leave you with less so that you can enjoy more minimalism is about freedom freedom from your debt freedom from always wanting to buy things you probably don't need and freedom to actually enjoy life the way it's meant to be enjoyed the experience itself I think we get all used some minimalism in our lives but money doesn't just appear in our wallet as a result of becoming minimalists unless you look like Gary Potter like me sorry magic when boiled down to its core essence minimalism is just one force of habit meant to replace the other bad forces of habit like wanting to spend money we don't have to buy things we don't need to keep up with the Jones but we're minimalism stops at creating a force of habit this video begins at creating an actionable plan that you can follow on how to invest your money so today I'm gonna show you how to set yourself up financially for the rest of your life by showing you the three specific key pillar investments that are going to automate your finances in such a way where you can stop worrying and that your money is going to work for you so you can finally be the awesome financial minimalist that I know you are and we're gonna get every rich CEO and all of their employees working hard every single day to make you richer just be aware though there are no shortcuts to building wealth and this is how I did it this is my Robin Hood portfolio right here it no this is not money that I inherited from my parents like some people like to comment this is actually money that I saved and invested and grew into this amount over the last five years while I was earning an average salary of just fifty thousand dollars per year in just five years and while I'm no minimalist this is the video that I made to show myself if I could go back years ago and tell my 20 year old self exactly how to invest when I was just getting started so if you follow the steps inside this video you can have more money than me in the next five years you can reach two hundred thousand dollars in just five years and no you're not gonna have to be a youtuber or some influencer to do it but it's gonna take a little bit more than minimalism to get there you're gonna have to let your money do some work for you and I realized just how scammy some financial channels can be and one of my biggest pet peeves is watching a video and halfway through realizing that they're just buttering me up to sell me some kind of a course so this video is gonna be none of that this is not an affiliated video this is not a paid sponsorship of any sort and I will earn zero dollars from recommending anything that I'm going to be talking about nowhere in the video am I gonna recommend you to sign up to some kind of sponsorship newsletter email seminar or webinar I had to write it down because I knew I was gonna forget all of them and no I'm not gonna send you some free ebook at the end of this I don't need your address and I'm not going to be monetizing my audience this information is 100% free and what you do with it is completely your choice just remember I'm not a licensed professional and with great power comes great responsibility let's begin what is up my frugal lovely people I miss you and I'm doing great thanks for asking I'm still feeling a little under the weather but I'm finally getting my voice back bat bat trick you know I get a lot of questions of people asking me what I think of stock s or index e or bond X or probably analyze read Y but I think most people just don't have the time to really understand the intricacies and the nuances of the stock market but you know what there's absolutely nothing wrong with that I think money is pretty boring and I'm never gonna put anyone down for not wanting to be a dividend nerd like myself because I think there's more to life than analyzing numbers all day long and at the end of the day money is just a tool meant to give us freedom it's nothing more and it's nothing less now I don't actually obsess over my portfolio right here unless it does this just picture this it's 2:00 a.m. doing my thing I open up Robin Hood and then all of a sudden where the number is supposed to say $200,000 it says this 50,000 40,000 30,000 50,000 the first thing that comes through my head is Trump just got impeached huh I knew it I knew it but no that wasn't it and then I thought to myself okay did the stock market crash I knew it this was the big one this is the big one that everyone is talking about since 2014 it finally happened and lo and behold that also wasn't it but you know what it was it was just Robin Hood being Robin Hood because that's what Robin Hood does so let's just begin with the three investments starting with number one here's the secret US market index number two international market index number three bond and or REIT market index now if none of that made any sense to you and I might as well have set it in a different language don't worry I'm about to explain everything exactly which ones to buy where to buy them how often to buy them and exactly how so I got you covered boo I got you covered like the Harry to your Potter I got you covered like the impeachment proceedings like the area to your 51 man I've been sick for two weeks and this is what happens you just get delusional sorry so number one US market index now let me ask you something do you want to retire later at 67 with more money or do you want to retire earlier but with less money I asked because the route that I have chosen is to retire earlier but with less money because my portfolio right here with Robin Hood the goal is to never sell these stocks now I'm going to sell some of them because I'm sure some of the ones I've picked here are does and they're not going to do well over the long term so I'll get rid of them and I'll buy something else but ideally I'm going to keep most of the stocks inside my portfolio for the rest of my life because I earn money off of just holding these stocks every single month and I'm getting paid about $550 off of my portfolio and you might be saying 550 off of 200k that's a terrible investment it's actually not an accurate picture because from this 200k nearly 200 I've put in only 1 30k it's not only it's a lot of money but 130k earning 550 is a closer learning's rate of 4% that's the dividend yield 4% is really good but on top of being paid monthly $550 my portfolio is also growing which to me doesn't really matter much because when I'm ready to retire I'm not going to sell this stuff remember that's that strategy that is the dividend strategy that I'm doing but notice I have a lot of stocks in here and you may not have the time to pay for all of the services that I'm paying and all the newsletters that I get that automates this process for me and tells me sometimes aundray consider selling this stock as dividends is not safe or Aundre consider buying more of this one because it's a really good value not everybody has the time nor the energy to devote to maintaining such a large portfolio which is why this video is dedicated to buying indexes which allow you to essentially recreate what I have right here but with like 1% of the work on your part and it's going to basically replicate and in some cases do better than I'm doing so for a dividend index or ETF rather that we're going to look into because I can't say buy this one that would be very illegal but I can't say consider researching the following so one is s PhD that we can go into robhinhood and it's this one the one that is yielding a 4.8% dividend yield which is just incredible and s PhD is an exchange-traded fund or an ETF that tracks the top 50 least volatile companies out of the S&P 500 oh and it's also tracking the top 50 paying dividend ones out of 75 of the highest paying S&P 500 dividend companies so now that sounds really complicated but let me break it down so right now each stock is worth about $40 in the $40 price range it'll obviously be different by the time you watch this video but one share if you buy it is going to spread out your 40 some odd dollars amongst 50 different companies which is how you can recreate what I'm doing with Robin Hood with all of these stocks by owning just one ETF now there's lots of different ETFs but this one in particular happens to track dividend-paying companies that pay you every single month you'll actually be paid which is super cool another one that you may want to consider looking into is vanguards ETF which is called the Y M so that is vanguards high dividend yielding ETF and it is giving us 3.3 percent which is still lower the price is higher but it doesn't make it worse or better necessarily but it's just - that you may want to look into so the alternative to building our first pillar instead of going with a dividend index strategy we can go with the growth index strategy so instead of focusing on passive income paying indexes we can instead focus on growing a final number that's larger so that if we're ready to retire by the age of 67 the traditional age that number will be a lot greater but there's a catch psychologically getting there is a lot harder because you're gonna see when I did my index strategy I hated it because I invested for over a year and then in one week I saw all of my gains just completely vanished and that's not to say it's not a good strategy but it means it takes somebody who psychologically built like a tank and I'm not I'm a human being I'm not a robot sometimes seeing that money fluctuate especially in the begin can be extremely difficult but if you can stick with it some of the ones that you should consider our vti and full disclosure I own vti in my m1 finance brokerage and you guys can see it right here it's a hundred percent of my pie this is in my Roth IRA or my retirement account and I decided to go with this strategy because it's different from my Robin Hood one where I have all of these individual stocks that I own I figure by the time I'm 67 years old money is gonna be less important to me I might need more of it obviously because of health reasons but it's gonna be less important to me and because of that it's held in a retirement account I don't wanna have to worry about maintaining all of these different stocks and I don't wanna have to pay taxes on any of this money I'm just letting it kind of grow and do its thing and I maximize it every year so vti is a great way to do that right now each share of vti is about a hundred fifty seven dollars and that 157 is gonna be spread out amongst three thousand six hundred twenty four different companies which is huge diversification and it's amazing but another one you might want to consider is vo o and vo o super similar index and the performance of the two are virtually the same at this point in time you can just pick one and you'll do really well for the rest of your life so if you love passive income pick either s pH D or B ym and if you love to be a growth person then just either pick vti or vo and just take as much of your income that you get paid from your job save it invest it into one of these and you'll be set for the rest of your life but you can go one step further the second pillar of an automatic investment portfolio or a minimalist approach is exposure to the international market because let's face it if the US economy tanks then maybe your money will still be making money in the international market but nowadays you can debate all day about the correlation of international markets with US markets because virtually every index holds companies like Apple McDonald's Disney and those companies are worldwide they're everywhere so that's neither here nor there but if you guys want to be exposed internationally you guys may want to look into vx us or the wo which is the emerge international markets and either when you go with you really can't go wrong either way but personally I would go with VX us because it's a lot broader and the next logical question is how much money do we put away into the US market versus the international market then like how do you split it up evenly 50/50 well you can go 6040 US international you go 70/30 8020 90 10 whatever you feel most comfortable with personally I would go with 80 percent US market and 20 percent international exposure and that's a really healthy mix but you can also go one step further and add a third pillar to this portfolio by adding bonds into the mix it's not necessary at all but I did do a separate video discussing stocks versus bonds at what age you should own how much if you're interested in checking that out as well so if you've gotten this far you pretty much own the world's economy at this point so let's recap if the world is moving forward your money is going to move forward so if you have a thousand hypothetical dollars that you're not sure how to invest but you don't want to worry about managing so many different stocks like I'm doing and you just want everything automated you may want to put $800 into something like vti and the other 200 into VX US or if you're a passive income guy like me but don't want to deal with all the individual stocks you can go 800 into s PhD or vym and the other 200 into also VX US the international market and that would pretty much cover the entire world you see investing like a minimalist doesn't have to be so complicated that just takes care of most of your needs and guys I know this video is pretty complicated usually I make much more simpler funner videos perhaps but I just wish I had this video to show myself when I was in my early 20s and just starting to invest love you guys hope you enjoy the rest of your weekend I'll see you guys very soon all right [Music] [Music]

Channel: Andrei Jikh

Views: 1,137,842

Rating: 4.9379773 out of 5

Keywords: minimalist, minimalism, minimalist money, how to invest, 3 investments, dividend investing, robinhood, robinhood app, m1 finance, stock market, stock market for beginners, minimalist investing, personal finance, passive income, financial independence, simple living, best index funds, vanguard funds, how to retire early, andrei jikh

Id: OoHUtsssyLs

Length: 15min 20sec (920 seconds)

Published: Fri Nov 15 2019