Millionaire Tries The Investing $100 Challenge (This Is How to Invest For Beginners EP. 1)

hi it's mark so have you ever had a hundred dollars in your pocket and wondered how you could turn it into a thousand ten thousand or even a hundred thousand dollars well sadly this isn't something they teach in school come to think of it it'd have been pretty awesome if they had because of this lack of knowledge it seems pretty scary for most beginners to get started in investing but in today's video i'm going to simplify the whole process invest in my money allow me to become a multi-millionaire and guess what i started with that's right a hundred dollars well probably less than that to be honest i'm not saying becoming rich is easy but by taking calculated risks you'll be able to grow your wealth over time i understand everyone has a different risk tolerance so today i'm going to be revealing how to invest for beginners with a hundred dollars and as we go through the video the risk is going to increase but remember as the risk goes up so does the potential reward i'll also be putting my money where my mouth is and investing a hundred dollars into each one of these options so you can see exactly how to do it i'm just about to invest in something i never thought i'd actually do it goes when someone asks me how they should invest a hundred dollars i usually say invest in yourself you can do this by buying books and improving your skills but assuming you've already done this now we're going to be talking about the specific places you can actually put your money now i'm a businessman i'm not a financial advisor these are just some of the ways i've invested my money over the years and they've worked for me you can also sit back and relax because i'm not going to try and sell you anything at the end just remember if you enjoyed the video then smash that like button because it really helps push this video out to more people and also consider subscribing if you want to grow your wealth the first investment is a high interest savings account this is a one out of ten on the risco so the lowest possible risk that you can have nowadays it's extremely hard to find any savings account that will pay a substantial amount of interest but that's not the main reason it's on the list by putting your money into a savings account you're actually starting to create what i like to call an emergency fund which i believe everyone should have this is money that you can access if something unexpected comes up and it's extremely low risk and by having money on hand you can avoid getting into debt and having to pay crazy fees back i remember when i bought my first apartment i had a minor crisis after about two months as a hot water system went wrong and it needed replacing because of my emergency fund it saved me over 200 as i didn't have to take out a payday loan when you leave your money in the bank it slowly loses its value so when i am looking for the best savings account to combat this i look for two things the first of course is a good interest rate which depends on the economy mostly the second thing is having the ability to access my money instantly some banks that are really worth looking at and consistently have a good rate of interest are ally bank markets by goldman sachs and citibank i currently have an account with markers by goldman sachs and their interest rate is 0.7 which isn't very high but it is currently one of the best available so there we go nice and easy 100 deposited into my savings account now for gold often referred to as a safe haven i'll give this also a 2 out of 10 on the risk out did you know that since the creation of the federal reserve in 1913 the us dollar has lost 95 percent of its value so you're actually only left with five percent of its original purchasing power so if you want to stop your money losing value then maybe gold is for you if you had a hundred dollar nugget of gold in the year 2000 it would now be worth approximately 580. the piece of gold hasn't actually changed in size it's still the same piece of metal but what has actually changed is the value of your dollar and how much gold you can buy with it gold was actually our original currency used by our forefathers i remember those days well it's perfect as it can't be manufactured and it lasts for thousands and thousands of years so if you've ever watched gold rush on tv you'll know how hard it is to actually mine this stuff out of the ground now you may be wondering if it's so safe why have i given it a 2 out of 10 on the risco it all comes down to opportunity cost you have to ask yourself if you really want to just protect your 100 against inflation or if you want to invest it in other opportunities which could make it grow a lot quicker if you invest in gold then you would be missing out on these potential profits making it a little bit risky i would say that this is the perfect investment if you have a lot of money already and all you want to do is just protect it there are two different ways that you can invest in gold the first way would be to actually buy physical gold but if i bought jewelry i know gold bars coins and that sort of thing i'd probably be paying too much because the person selling it would want to make a profit which means i would be paying more than the true value of the gold itself the alternative is to invest in gold within a broker app like robin hood in the usa or trading 212 in the uk then you're able to buy gold at its true value and have the option to sell much quicker in the usa i would look for the gld etf on robin hood which is one of the largest gold etfs in the world as of june 2020 they hold over million ounces of gold in vaults all around the world as i'm currently in the uk i'm gonna invest using trade in two one two in a similar share and with just a click of a button there you go i'm now mr gold man if that doesn't sound exciting enough for you then why don't you try a simple low-cost index fund i'll give this a 3 out of 10 on the risk scale if you invested just 100 per month into an index fund with a 7 annual return then after 30 years you'd have 123 thousand dollars that's the power of compound interest you can do all of this without having any knowledge of the stock market i remember when warren buffett one of the richest men in the world placed a million dollar bet that a simple s p 500 index fund would outperform a professionally picked portfolio of hedge funds over a 10-year period now this contest wrapped up in 2017 and the results were made public warren buffett had actually won a million dollar bet which really shows the power of index funds and that the everyday person can take on the pros with little to no knowledge imagine an index fund is like a bag of haribo gummies the machine in the factory puts a range of the most popular candy into one bag so you can enjoy the best of the best without having to pick and buy each and every one individually now just replace the candy with companies that's what an index fund is you can buy your own selection bag of the most popular companies in the world such as apple microsoft amazon and facebook and your money is split between all of them now let's go back to the haribos imagine you left these on the side and they're open for a few days or so they'd go hard and they certainly wouldn't taste as good would they but by putting them in a container you can stop that from happening this is very much like index funds is if you leave them unprotected the government will start taxing you on the profits you make but you can protect them with a sort of container like this which is known as different things in different countries in america it's called a roth ira and in the uk it's an isa these containers allow you to protect your money after tax and then any profits you make are yours to keep but because they're so good and they're so powerful there's a cap on how much you're allowed to invest each year so if i was you i would take full advantage as soon as possible and max out your allowance there are more in-depth strategies you can use but for the purpose of this video i'm going to be investing a hundred dollars into an s p 500 index fund which over the last 20 years has an average yearly return of seven percent drop a like if you'd like a full video covering this topic because there's so much on this we could talk about but mark a hundred dollars isn't enough as the s p 500 is over three thousand dollars a share well you don't actually have to buy a full share to invest my favorite brokers are fidelity child swap and vanguard so if we head over to vanguard's website now and we find the s p 500 here you can see what companies are in the index fund so you can buy the right one so all you have to do is create an account i already have one and deposit some money and then click there you go job done the fourth way to invest is in a real estate investment trust otherwise known as a reit i'll also give this a three out of ten on the risk scout now imagine your friend collected a hundred dollars from three thousand people he will have three hundred thousand dollars then he takes this money and he buys a property he rents it out and splits it with all three 000 people that helped him buy the property which helps them start generating some of that sweet passive income that's the basic way of explaining a reit it lets everyone benefit from investing in income producing properties without actually buying one think of it like buying a small share in a property let's say you own the front door someone else owns the windows and a few other people own all the bricks but all together you own the property equity reits own things like offices shopping centers apartments hotels and much more and they get their income through the rent by law they have to pass on 90 of all profits to the investor like a dividend however they're taxed a little differently the cool thing is that at the start of 2019 the 10-year average return for re-etfs did better than the s p 500 with an average return of 10 if you're in the usa by investing in the vg slx by vanguard you can average a 12 percent return which beats the average real estate investor how awesome is that as i'm in the uk i'm going to use the trading 212 website to put a hundred dollars into a similar reit it has high global diversification meaning i can invest in all the up and coming property markets around the world the next option is buying and selling items the risk on this really depends on how good you are at finding great deals but i'll give this a i know four out of ten on the risk scale the good thing about doing this is that you can buy and sell something that you're interested in and have knowledge about which can lead to bigger possible returns now i'm going to invest my hundred dollars in either pre-owned radio control model gear or golf equipment both of these i've got an interest in so i should have a reasonable idea of what each item is worth pokemon cards would be a great area to have some expertise in as their value at the moment is skyrocketing logan paul just bought a charizard card for over 150 dollars how mad is that so i've been on facebook marketplace as most people have access to that platform and i found myself a model engine that i'm going to go and try and buy it's up for 75 pounds which is approximately 100 us dollars we sent a few messages back and forth and i'm going to go and have a look at the item now hello there i've come about the engine oh in the box as well cool that's good cool it looks right so would you take 70 for it no i've got 75. this box in good condition can you do a bit better i'll tell you what i can do there you go i'll throw that in really that's what it came out of 75 quid that's that's a deal okay there you go i'll give you 75 quid there you go and we're videoing this for our youtube channel do you mind no that's fine all right then see you again thanks a lot thanks for that so i've done a listing on ebay for the model engine and the model plane i'm going to actually advertise on a specialized website for model flying as i'm sure i'll be then selling to the right people and hoping for big profits now we're starting to get serious it's time for individual stocks this gets a 6.5 out of 10 on the risk scale there's a certain amount of risk that comes with investing in individual stocks but if you pick your companies well then it can be really exciting is there's the potential to make a lot of money during a dot-com boom back in 1995 i was really lucky to pick a few great stocks which i cashed in and i made a lot of money in a very short period of time when the bubble burst some of the companies i'd held on to which has cost me very little went completely out of business luck and timing can be a very crucial part of stock investing i picked these stocks using what's called fundamental analysis which means i looked at the business financial statements their market and also the leadership of their companies back then this was a lot of work but now it's easily found out on yahoo finance a while ago i read an article about an experiment where they simulated 100 monkeys throwing darts like this at the financial pages of a newspaper the stocks the monkeys picked on average outperformed the so-called smartish hedge fund managers on wall street so for this video i thought it'd be fun to put this theory to the test i don't have a monkey so i thought i'd have to do so i'm going to throw a dart at the board and as you can see i've randomly selected 20 different stocks and wherever the dart lands that's what i'm going to invest in now i've just got to put on a blindfold okay here we go right let's see what we got and we've gone into samsung right so i'm going to jump straight onto my brokerage account and set an order for samsung if you want to invest your hundred dollars in individual stock then weibo are currently giving away three free stocks for a limited time when you deposit a hundred dollars into your account i'll just leave the link in the description if you want to pick up those free stocks so now we're going to be moving into the realm of gambling and speculation rather than investing number seven is cryptocurrency this is a 9 out of 10 on the risco so you've probably heard of bitcoin this is currently the most popular type of crypto if you had bought a hundred dollars worth of bitcoin in 2015 today it would have been worth around about five thousand dollars that's a 5 000 return on your investment and that's pretty unheard of therefore many people that invested in bitcoin in the early days became millionaires overnight but a lot of people also lost money if you'd invested around a hundred dollars in december 2017 when bitcoin was at an all-time high by december 2018 you'd have had less than 17 left so really no one really knows what it's going to do next it's extremely risky but still very attractive because it has the potential to make you millions there are three main types of cryptos these are ethereum ripple and obviously the big one bitcoin but let's just focus on bitcoin today if you want to learn more about other types of coins you can read something called a white paper and it will give you all the details the cool thing about bitcoin is that it uses something called blockchain and it isn't regulated by the government you also can't create any more bitcoins which makes inflation absolutely impossible in my opinion this investment will probably only make sense if you're investing an extra hundred dollars that you don't really need so i'm going to jump onto the most popular bitcoin app which is called coinbase and invest my hundred dollars in bitcoin and forget about it by the way if you want to give this a try i'll put a link to coinbase in the description down below and you can pick up ten dollars of free bitcoin at least that gives you a bit of a head start the last is definitely a full-on gamble you may have guessed it already it's the lotto this is definitely a 10 out of 10 on the risco and isn't something i would recommend doing however i thought i'd include it in this investing video as so many people choose to do it in fact 57 of all americans buy at least one lotto ticket per year the chance of actually winning is 1 in 14 million which might sound quite possible but let me just try and put that into a bit of perspective you're 4 000 times more likely to win an oscar than win the lotto millions of people lose their money every year but they keep playing as the rewards are sky high if you win i'm just about to invest in something i never thought i'd actually do it goes can i have 100 scratch cards please lovely thank you very much thank you cheers and thanks bye as you can see this is going to take me quite a while i'm going to leave a counter on the screen so you can see how much i've spent versus how much i've earned back from my investment let's do this [Music] i hope there's a bit more in this lot there's got to be hasn't it so we're halfway through the most we've earned so far is three dollars on one ticket i'm going to need some help i've got 50 more to go come on curtis i know you've been itching to have a go at this have you got your coin ready i do ready let's race to see wait for it who can find the most money in the remaining 50 cards ready okay on your marks get set go y'all ready to go come on 15 really yeah no yeah oh wow 15. he's only just started doing this he's got more than me [Applause] find a 2x to win two times that must be ten dollars we think is that ten dollars ten dollars ten dollars [Laughter] you say you're smashing me but i'll tell you what how about this how about this another dollar [Music] [Laughter] [Music] you're ready now i'm making my move better cause i'm coming through i'll tell you what this has gotta be an astonishing last four cards if we're gonna get any money back from this so we just came back and we double checked it we made back fifty dollars from our hundred dollar investment now you may think that sounds pretty good but that's actually a negative fifty percent return this was meant to be a little bit of fun but it's pretty sad to think that people play this regularly and on average are losing half their money when they could pick any one of the other investments in this video and have a much better chance of being successful i hope this has taken some of the mystery away from the other forms of investing and made them a little bit more understandable for beginners if you'd like me to make a part two of this video to see how these investments have done over a month then make sure to smash that thumbs up button to let me know i'm going to leave the next video here but don't click on it just yet remember to subscribe to the channel and ring that notification bell so you don't miss out on part two okay i'll see you on the other side

Channel: Mark Tilbury

Views: 2,424,723

Rating: 4.9536519 out of 5

Keywords: investing for beginners with little money, beginner investor to millionaire, investing 101, investing for beginners guide, how to start investing with little money, how to invest for beginners with little money, how do i start investing with little money, how to invest small amounts of money, vanguard index funds, how to start investing in stock market for beginners australia, Investing for BEGINNERS with $100, investing for beginners, how to invest, passive income

Id: jw_CWHs2YDU

Length: 18min 50sec (1130 seconds)

Published: Wed Nov 11 2020