The Simple Path to Wealth with JL Collins (Unedited- ENTIRE SESSION)

rashad hey good good afternoon mr collins how are you doing good afternoon it's jl i thought we oh we i thought we confirmed that in an email man am i pronouncing your name correctly rashaan rashad you are one thousand percent correct hey i'm very am i correct about anything hey i'll tell you one thing you correct about this right here bless you bless you i appreciate that this this is very kind in your in your comments when you uh sent me the first uh email i appreciate that you know i'm just i'm just keeping it honest i i don't come from much financially i come from two parents and we we you know we grew up broke and it was a struggle you know and we have that in common i mean now we're at the point my wife and i where we just we can't believe how well we're doing financially and it really is a simple path like all of my stuff is in vtsax uh my four my 457 however is in the vanguard 500 form because they don't offer vtsa so 457 you're uh a teacher public employee so i'm i'm a i'm a principal i'm i'm a school principal my wife is a teacher okay and and your who's your audience that's going to be listening to us today well we got some people that i think are going to be some from some of the the fi groups because i believe these educators by and large yeah for the most part educators and friend educators and friends of mine on facebook and then i'm gonna so my youtube channel i'm gonna be creating is really really geared toward educators and public servants police officers firefighters because for the most part we get you know our paychecks are pretty much in the same same range right right and for the most part we get a we we get a pension you know so you're a principal i am i'm an alternative school principal i'm in my 11th year as an administrator you're the guy i used to be terrified of i'm not i'm the guy let's say it again i said i'm the guy i used to be terrified of myself that's one way to get over the fear is become the guy become the guy yeah yeah the story man i was i grew up i was born in hartford connecticut and i grew up in piscataway new jersey uh-huh i don't know if you know much about piscataway it's where i think half of rutgers is in piscataway the other half is in new brunswick yeah i don't know anything about the area okay okay okay well you know my we used to have career day and one time they asked me what do you want to be when you get older and everybody like i played football you know i was an eight-year-old playing football and yeah everybody says i want to be in the nfl but i said i won't be a principal one day oh wow that's early on well the reason is because i remember our principal i can't remember his name he was a he was an older white gentleman but he was really i remember i always picture the principal being the person in the school of authority the person who spanks your butt when you get out of line right right and this particular day i i got taken to the principal's office i can't remember why but he showed me quite a bit of empathy he didn't he didn't want me or anything you know and ever since then i said man that guy was pretty cool i'm gonna be a principal one day and sure enough i became a principal so wow and and so are you showing empathy are you whooping we can't whoop hey hey fyi i'm at the alternative school too so i'm the principal of the campus when kids get in trouble but and i i might have time to mention it today but the reason one of the reasons i started this is because i saw a disturbing trend you know you have the 60 65 year old educators and you know you think hey he's been doing it for 45 years he absolutely loves the kids you know which they do you can't do it that long because you necessarily you don't love the kids but one thing i was seeing was that they were doing it out of necessity because they had to like they just didn't have the money to even though they they were eligible for a pension your pension might not be where what they wanted to be or it didn't cover all the debts that they had you know right so i said man how can we you know when i when i retire i don't want to just rely on my pension which is going to be a generous pension but i want to be able to travel the world i want to be able to do whatever i want to do without you know worrying too much about it so right and you don't necessarily want to have to wait until you're 65. no i'm it's great nice to have the option to step away earlier if you want it yeah absolutely so in texas my wife and i moved here in june of 2007 yeah june of 2007 september of 2007. they changed the pension plan so they took it from the rule of 80 to the rule of 90 so i beat it by like a couple months i started actually working in the school district about two weeks before they changed the pension plan so now i can retire at 53 with 27 years of service and collect my full pension instead of you know teachers that are coming in now i have to go to like 61 or something i was like there's no way oh wow so you snuck under the wire yeah i made it like right in time and so i can leave at 53 and about how many years how many years do you have in right now i have i have four i'm completing my 14th year so so did you start as a teacher or did you go into administration right away so i started as a teacher i taught two years in daytona beach after i graduated college and then we moved here i taught three years and then i became an administrator and i've been doing that for 11 years and your wife's a teacher too she's a special ed teacher yep is she in your school or in a different school no that's that's nepotism so my next question is going to be do you have her under your thumb or i couldn't i couldn't handle too much of that but i got i can't work with people i see all the time you know yeah yeah she's in my district though her her her school is five minutes from my school and then all of our kids were in the same district so you know we're proud of that how many kids you have three kids three yeah i know you've got one that's gonna turn 10 tomorrow yes baby girl's going to turn 10 tomorrow yeah she's your she's your youngest no i have we have a 14 year old son and he we call him our anniversary baby because our first anniversary was spent in a hospital giving birth to him well since we've been married we've really been with chi with children so he was born on your anniversary he was born on our first anniversary now from a male point of view i could say that's ideal because because that's one less state you have to remember that's true when my wife was pregnant with our daughter uh my wife's birthday is april 9th and it was pretty clear that that the baby was going to come in april and i'm rooting for the night because now i've only got one birthday to remember but she was born in the first so i have to remember too yeah i know some guys that have that got married on valentine's day and then i know some guys that were able to pull off a february 29th wedding no that's that's brilliant thinking hey that's that's that's brilliant and they must have the best wives in the world i don't know yeah one guy in my life a guy used to work with who was born on february 29th really that's pretty cool that is pretty cool yeah it's unique if you think about it i mean there's not too many people that can say that you know when you live right i guess it would be for the most part one one 365th of the population is born on any other day you know so right so it would be four times yeah four times lately yeah you're a master i used to be a math teacher yeah and i mean you know we're assuming of course that the distribution of births is equal across the calendar and i don't know that's true i'll bet that there's some i bet there's some parts times of the year where births are higher than other for some quirky reason but that's a you know what that's a i think that's a great theory because if you think about it the summer might be nine months after summer months might be when a lot of people give birth because you know they're they're frolicking yeah yeah yeah you know maybe nine months after the holidays because it's so cold and may you know so i don't know so is your is your tenure what's your ten-year-old's name so my so my ten-year-old is nia nia yeah nia yup and then we have a an eight-year-old her little brother and so we have three kids god nia and amari and they're great kids well now of course nia is my favorite hey i know all due respect to the others because she's the one you told me recognize my voice is nia going to be listening today she is so nia i so i interviewed a buddy of mine on saturday and nia i saw i looked down after my interview and i saw a friend request from nia i was like so she she created a facebook account just so she could support her dad that's nice so now i added her as a friend and she she said she'll be tuning in today she's more excited than me i am no kidding so she is gonna be tuning in today she said she's gonna tune in so now you're not you're not you're at your office i think right i'm at my office i'm trying to make it look like i'm not at my office you know so she's not well you you the only reason i know that is you mentioned in your in one of your emails that you can do this in your office so i assume she's at home she's at home she's they all three of them work so they're doing virtual learning for for now yeah and they're all with my in-laws today okay that's been going pretty well but yeah she's there yes that's another i didn't even think about that uh rashad is is your your school are your schools are shut down i assume or they're not shut down their kids are back yeah we just kids wear masks and matter of fact governor abbott just he just uplifted everything so texas is going back to 100 percent maybe tomorrow i don't know exactly coming up no next wednesday on wednesday we're going back to 100 so obviously teachers and everything are already creating chatter about that yeah are they concerned about it or they're like yeah their their concerns but you know i told i just emailed my teachers and said hey don't you know don't assume anything if you're talking to your friends about it just wait to hear from official word from the the district office so yeah well hey we're almost at four o'clock well i'm i'm ready to rock and roll when you are i should have called in earlier i'm enjoying this this little private conversation let me just i'm gonna step away just to turn the heat down i'll be okay i mean seconds that's fine that's why there we go okay i'm gonna go ahead and start working on getting started on this going live on facebook right now all right how many people do we have showing up do you have any idea let me check let me check i think it's gonna be quite a few let's see a lot of people said they're showing up and you know people will come you're not gonna have everybody up front so right now is preparing a live stream you're gonna record this too and oh yes sir i'm gonna record it and put it on youtube so you'll make it available for other people if you want me to uh put on my social media just send me a link when you get it up and i'll i'll share it i will absolutely do that you do not have to ask me twice let me see important information there right now looks like i got a little bit of uh glare on my face here you up are you are we doing video as well or just our video yes sir let me see if i can make the how does that look better it's still a little glare still a little glare let me see if i can shut this one how are we doing now that's better all right so let me see so i'm gonna go i'm gonna hit go live right now and it takes a second we are going to give it a few minutes before we get started just let us get in are we live for those few people yes sir we are live right now oh there you go now i got to behave myself yeah you got to you got to put on a smile for the camera now miss colin jl i get rid of my sour face okay we will be getting started in a minute alrighty okay good afternoon thank you for tuning in to another episode of the wealthy educator where we recognize and empower educators and others alike before we introduce our guests let me tell you about a great opportunity we will be giving away five copies of the simple path to wealth for your chance to win please like and share this video on facebook then head over to the wealthy educator on youtube and subscribe to the channel once these steps are complete email the wealthyeducator gmail.com with your name and location and you will be entered into the live drawing that will take place at 5 p.m central standard time on friday march 5th what if someone told you that the path to wealth is very simple not easy but simple that's exactly what my guest is here to discuss with us today mr j.l collins is known for his stock series and his book the simple path to wealth he has been featured on many podcasts and documentaries he is known as the godfather of the financial independence movement simply put i refer to him as the fi goat ladies and gentlemen i welcome mr j.l collins jl how are you today rashad i'm doing great thank you it's it's an honor to be here wow what an introduction but before we go any further i just want to send a shout out to my favorite soon-to-be ten-year-old happy birthday tomorrow happy birthday tomorrow nia from your pal junior thank you for recognizing my voice awesome well okay i guess i have to tell the story then is that okay with you that's okay with me or we could just let everybody wonder who nia is and what this connection is but it's up to you well i'll quickly tell it well basically mr khal is a jl as he would like to be referred to jl is one of the most requested speakers in our country especially when it comes to finances and financial independence so people wonder dave even asked me how did you get jl collins to agree to interview with you well it's simple you know i was listening to youtube one day and as i always do and his voice is always on my youtube channel and my daughter was sitting with her brothers one day and she just said hey is that jl collins so i looked around and said what did you say she said is that jl collins i said yeah that's j.l collins how'd you know she said daddy you're always playing mr collins true story so i happened to go over to the choose fi group on facebook and i just said hey my f i win for the day is that my nine-year-old daughter recognized jl collins voice and someone happened to actually tag dj l collins in that post and then i trolled him and i sent him a message he actually responded in the rest is history so here we are i'm delighted to have him here i think that anybody who wants to create a financial path for themselves you know will will really benefit from what he has to say today give me a hug for me when you when you see her tonight i will give her a big huge hug for you just for you got a big place in my heart oh i appreciate that i appreciate that well so why don't you go ahead and tell tell the audience about the story with your daughter and just let everybody know you know the why behind your blog and your book and then you know just go just go ahead with that and what is the simple path to wealth well that well that covers a lot of ground i'll start with the with the story of my daughter and and we can go from there uh all of this evolved i i have a very firm belief that we live in a complex society and the most powerful tool we have at our disposal to navigate and survive and prosper in the society is money and the better you understand money in investing the easier your life will be the less well you understand it the harder your life will be and of course like any parent i wanted my child's life to be as good and to have as many opportunities and the path to be as smooth as possible the problem is i started pushing this stuff way too young for her i mean who would have thought that uh that a four-year-old wouldn't want to dive into the wall street journal with me but turns out she didn't and the net result of that is i turned her off to these financial things and because i turned her off and because none of us know how long we have on earth at some point i decided i better write these things down in case i'm not around when she develops hopefully an interest in this so i started writing a series of letters to her about things financial and a business associate of mine who i shared them with said you know that's kind of interesting stuff you might want to create a blog for your friends and family and i didn't particularly have any interest in creating a blog but i like the idea of of that way to archive the information rather than just sheets of paper lying around somewhere so i created the blog and i began to put these things down for and and i sent an email around to friends and family letting them know because why not of course none of them cared and but slowly or surely as i wrote more of this stuff i began to develop what's turned into an international audience today and uh i wound up writing the stock series and the stock series has 32 posts to it i think something like that now my original plan was only five when i first conceived of the idea i had the first five posts in mind and then with questions and feedback from my readers other topics came to light so that's how that evolved and from the stock series came the book you were kind enough to mention the simple path to wealth and and now i get asked to do interviews from cool guys like you so here we are that's awesome that's awesome well you know a lot of my audience of course you know as i told you before are educators and also look at public servants because i really appreciate firefighters police officers you know like that and a lot of time we aren't necessarily educated we don't really know much about finances uh you know when we had the whole game stop fiasco you can't tell i can't tell you how many messages i receive from people saying hey i want to start investing in stocks and i'm like hold on now first of all i don't invest in stocks i don't invest in single stocks i don't play around with that and you know if you do that you're going to get burned so then i always refer people to your stock series on choose if i always send one of those links or or your book or something like that so if you could kind of explain to the audience you know what are what are stocks what are bonds mutual funds index funds those things sure so uh stop when you own stock when you buy a stock what you're doing is you're you're buying an ownership a piece of the ownership of that company so you mentioned gamestop so let's just use that as an example if you buy stock in gamestop you now own a part of gamestop probably a very small part of it but nevertheless in a very real sense you own a tangible part of that business for better or worse um if you own a bond uh if you buy a bond from either a government agency like the us treasury or or maybe a state bond that's issued to fund the building of roads or or what have you you're basically now loaning your money out you're not you're not buying a piece of a company or an organization you're loaning the money to them and the way bonds work is they typically have a maturity when the bond has to be paid back and between the date you buy it or the date it's issued and that maturity there's a set interest rate that is depending on what the competitive market says that government or company has to pay to to find people who are willing to buy their bonds to loan the money so if you own stock you own a piece of the organization if you own a bond you've lend you've loaned money to somebody now mutual funds are are run by investment companies and basically what they do is they take your investment money and my investment money and the investment money of many many other people and they pool it together and each mutual fund will have its own set of objectives so there are mutual funds that invest in bonds there are mutual funds that invest in stocks there are mutual funds that invest in both that are called balance funds and then there are all kinds of different ways to invest in stocks so you can they can invest in certain stock sectors they can invest in certain size companies a lot what's called large cap which just basically means a big company mid cap which is means a minimum middle size company or small cap which is small company so they could do it that way i'm a believer in what are called index funds and index funds simply buy every fund that's tracked by a given index and the index i prefer is the total stock market index and that means that essentially when you buy a total stock market index fund you now own a piece of every publicly traded company in the united states and that gives you a very broad diversification which is what i like in a very low cost i when i own bonds to the extent that i own them i own them in the total bond market index fund which is similar to the total stock market fund only now you're owning all these bonds so does that make sense yeah that that definitely makes sense so let me ask you this what if you have someone that decides hey you know i'm going to purchase stock in apple i'm going to purchase stock in nike i'm going to purchase stock in these companies that have been around you know for my 30 or 40 years on earth that have been doing well for a long time i know that they're going to be successful for the rest of my life in 50 to 100 years from now what would your pushback be on that if they say hey i don't need to invest in an index fund well i guess my push react would be how do you feel about polaroid how do you feel about xerox how do you feel about general motors 50 years ago maybe a little more than 50 years ago uh in the late 60s early 70s somewhere in there some of the smart guys on wall street came up with the what they called the nifty 50 which was exactly what you're describing they said you know if you buy these 50 stocks which are the dominant players in in the us economy you know the best companies in the us if you buy them and you just put them away you're done you you know these companies are going to be here for the rest of your life they're going to you know they're going to be the dominant companies forever and you never have to make another decision well you're fast forward to today and a lot of them are unrecognizable names because companies have a life cycle so right now amazon and tesla and apple and what have you are the dominant companies that doesn't mean they're going to stay the dominant companies put that in perspective um the dow industrial average was created sometime in the very late 1800s and i think there were 20 stocks initially now it's the dow 30. and i used to ask people so how many of those are those companies originally on the dow do you think are still on the dow today and my trick answer was there was one general electric well now even general electric has fallen off the dow so companies have lifestyle the the economy is dynamic one of the things that i love about vtsax which is vanguard's total stock market index fund is it's what i call self-cleansing which means that as companies fade away they drop off the index and you're always getting the benefit of the new blood the new exciting growing companies that then become the teslas and the amazons and the apples and the microsofts in the future one of the criticisms of index funds because they're cap weighted which means the more successful the company the greater percentage of of it the index owns is the now for instance it's very heavily weighted towards tech and the critics say you're you're basically you're making a bet on tech which may or may or may not pay off in the future the point they're missing is that there was a time when it was heavily based on energy because those were the dominant stocks and and where financials had their day in the sun or industrials at various times have dominated the index that's a self-cleansing process i don't know how long technology is going to dominate what i do know is that i'll i'll be participating as long as it's dominating and then if and when it fades away whatever comes up to replace it and i have no idea what that'll be i will benefit from that long answer to a simple question i apologize that's a great answer and you know i wanna when you talk about vtsax when you're buying a total stock market what is the benefit so when you think about i like when you talk about the dogs there's today's dogs might be tomorrow's heroes and right you might lose 100 of a stock but you can gain more than 100 so kind of explain or go into more depth about why vtsax can be very beneficial to someone's portfolio so maybe we need to step back a little bit and say that vtsax is an index fund that kind of alluded to that earlier and index funds are funds uh that are different character than actively managed funds so an index fund as we discussed a moment ago buys everything in the index so when you own vtscx you own virtually every company that's publicly traded in the united states an actively managed fund on the other hand is just what the name implies it's it has managers who are trying to pick and choose the companies that will outperform the other companies and one of the problems that sounds so logical uh because you say your self would cheat if i if i could just avoid the dogs that are in the index you know then obviously i'll outperform the index or if i can just focus on the the best companies the high performing companies in the index then obviously i'll do better than the index but as you just alluded to sometimes today's dogs are tomorrow's exciting turnaround stories and sometimes today's hyper successful companies are enron which i might be dating myself but that was a huge successful company that in the collapse of 2008 cratered suddenly unexpectedly so it's very very difficult to accurately predict what the dogs are going to be and what the out performers are going to be if i own them all i don't have to do that moreover i don't have to pay managers to try to do that so my costs are low and there's jack bogle who's a guy who who started vanguard who created the first index fund the concept of it used to say performance comes and goes but costs are there all the time costs are always dragging on your performance so if you buy an index fund you have very very low cost and then you just said something very important and asking the question you said you could only lose a hundred percent if you buy in a stock and that might not sound very impressive until you put in the context of there's no limit to how much you can gain right so if you own the index and some of those companies drift away and by the way they'll fall off the index before they go to absolute zero but still they can go down quite a bit at the same time you'll have a company like tesla as an example that's coming up that it's not just going up a hundred percent or 200 percent but multiple thousand percents over time so in that sense it's a rigged game rigged in our favor if we have index funds because the ones that drift off have a very limited downside the sky's the limit for the ones that that prosper and you will always own the ones that are coming along so there is a big announcement thinking of tesla recently i was in december maybe they they were accepted into the s p 500 which is the largest 500 companies in the us and so people owning an s p 500 index fund now own tesla but in owning btsax a total stock market index fund my funds owned it since it first went public got it okay well you know when i was deciding where to put my money in my 403 being like you know i'm an educator and right choice and i really agonized should i put it in vtsax or should i put in the vanguard 500 fund was my was my agony was it you know should i have agonized over that or not really are they you know is there much so that's a great great question and and i'm going to kind of almost contradict what i just said in answering it so um first of all you you probably made the right choice vtsax is what i suggest but had you gone into the s p 500 fund that also would have been a great choice so here's the thing i mentioned earlier that these funds are cap weighted which means they own a bigger percentage of the larger companies so vtsax has a very similar portfolio to the s p 500 in fact those top 500 companies that make up the s p 500 are about i want to say 80 percent of the portfolio in vtsax and then the other 20 is made up in those mid cap and small cap which is say mid-size small size companies which is why we grab tesla early on and not now and that's why i prefer the total stock market index but frequently when somebody has a a 401 k or 401 uh plan they may not be offering a total stock market index fund very commonly they'll be offering an s p 500 index fund and that's a that's a fine choice there's nothing wrong with it and if you actually track the performance of these two funds over time they're very very close there's a hair width of difference between them and so you know if you had bought the s p 500 fund and and we compared notes the day you bought it uh 10 years from now we could sit down and compare notes and one of us will have done better than the other but it could be in that 10 years that the large cap stocks were in favor and you might have outperformed so long answer to a simple question but if you can go with the total stock market for reasons we talked about but if the s p 500 is available that's a great choice great great that's awesome that's i really appreciate that information now you know obviously everyone wants to get to the point where they are socking away as much money as they possibly can early as early and as often as they can however we all know that there is one huge hindrance that stops a lot of people from saving money and it's the big the d word debt what what is your viewpoint on debt the worst the worst four-letter word in language yeah so i i mean i i think a debt is is it's a ball and chain around your ankle it is uh as my friend mr money mustache likes to say if you have debt especially if you have consumer debt that's a hair on fire emergency um debt is the single biggest obstacle to becoming financially independent to becoming wealthy um so i've never had that other than mortgages occasionally i've never even had a car loan i have such an aversion to it to me it's it's like being covered with leeches uh and yet most americans accept debt is a natural part of of living and it's like what to my mind you know it's it's like saying well of course i'm walking around covered with leech because doesn't everybody and in our culture everybody does walk around with debt but i say pull out your sharpest knife and start scraping little blood suckers off and until you do that you will never be financially free you'll never be financially independent because every dollar you come in has to not only go to pay for your current expenses and hopefully go into your investments for your future freedom but some of it's getting siphoned off to pay your your creditors so it's a it's a horrible thing and job one if you have it is to get rid of it a good news is if you organize your financial life in such a fashion to free up money each month to pay down that debt you have created a wonderful discipline right so every month you're you're putting the maximum you can to get rid of that debt because again it's it's leeches drawing blood from you once that debt's gone you've got that discipline of setting aside that money and now instead of paying it to your former creditors you pay it to yourself with investing and you've already got that that savings discipline in place so that's the only advantage i can think of it now obviously if you don't have debt you can create the savings discipline and and start from ground zero yes sir so you know let me ask you this you know there are some people who believe that when you're trying to crawl your way out of debt you do the debt snowball you you list from smallest balance to largest balance even if the small you know the smaller balance is a certain percentage i believe you feel that the debt avalanche is more advantageous than the snowball correct well i'm not familiar with the term avalanche i think the snowball is comes from dave ramsey if i'm not mistaken yeah it's supposed to be more psychological like hey i knocked these small ones out then i take that payment and apply to the next one where some people say hey we just listed from the highest interest rate first and then we knock out the highest interest rates and work work like that because you're going to ultimately save more money by paying off the higher interest rate loans before you pay off the lower interest rate loans yeah so i'm i'm a little bit of a hard case in how i think about these things so there's a lot written not just about debt payment but about investing in finance that is designed to cater to to people's psychology right so the snowball is as you called it the the idea is that you have a bunch of different debts and it's psychologically satisfying to pay get something completely paid off so what you should do is you should find the debt the smallest that you have and pay that off to get that psychological carrot if you will for having done it and the idea is that then maybe that encourages you to pay off more debt because you've gotten that psychic reward and i suppose if you need that psychic reward then maybe that's what you need to do but for me i say better to change your psychology because the most financially effective way to do it should be pretty obvious is to look at all the debt you have and say where am i paying the highest interest rate because that's the most expensive debt and whether it's the largest standard the smallest that pay off that i mean because paying that off is what puts more money in your pocket quicker or more accurately is what prevents more money from going out of your pocket quicker so i say change your psychology focus on paying down that expensive debt and do that first so i'm not i'm i'm not a fan of psychological crutches now having said that if you know yourself well enough to know and you say hey jl you know if i don't get a little psychic reward once a while i'm not going to stick to it then god bless you you know maybe maybe dave ramsey is on to something that that that i'm not i'm not on to but if it were me i go with where the numbers take me well and i agree with you because i believe that when you're trying to crawl your way out of debt whether it's ten thousand dollars or a hundred thousand dollars every penny counts absolutely i mean if you save an extra ten dollars a month by paying off the higher interest rate first then you could throw that into your you know into your payment next month so i just i think you have to try to knock out the highest rooms first and i will say this when you're talking about debt i can still remember to this day when we became debt free i remember the morning when i actually looked at all my accounts and they were paid off and i went to work i just felt like a different person i felt like i was empowered i didn't feel like i was going to work for bank of america or chase or anything i felt like i was going to work for my family so i i do think you have to get out of debt as soon as possible yeah i mean it's almost literally like like you know for however many years you had the debt every day you walk out of that door and you're dragging this ball of chain along and maybe you even get so used to it you don't even notice it but suddenly if it's unshackled and drops away from you you're like holy cow this is this feels great you know i am much lighter in in body and spirit than i ever dreamed i could possibly be getting out of debt is one of the great gifts you can give yourself and your family i agree with you 100 so let's kind of shift back to investing he had a married married couple and they have 12 12 000 sitting in their checking account for a roth ira on january 1st do you lump sum invest at twelve thousand dollars six thousand each or do you spread it out five hundred dollars each month hands hands down if you're me you lump summit okay okay and why is that i was hoping you'd ask so so here's here assuming now first of all we're assuming that when you're putting it into your roth ira you're you're investing in stocks that that's the investment we're talking about and that you're investing in vtsax and if it's in a if it's an ira there's no reason you because you can choose any fund at that point you're not limited to the choices of an employer plan so there's no reason not to go into btsax let's say that's what you're doing the key thing to understand is the stock market goes up much more often than it goes down right in fact it goes up about three years out of four now unfortunately it doesn't go up three years and drop four and then go up three years you know that would be nice and predictable but that's not the way the world works but on average it it goes up three times as often as it goes down so when you put your lump sum in you are basically making a bet that you have a 75 percent chance of winning which is that every month from there on the market will go up and go up and go up over the course of the year and it will be up by the end of the year there's a 25 chance you'll be wrong and if it happens to be that year you would have been better off dollar cost averaging but you've got to play the odds it seems to me and and and if i have a choice of going making a choice that i've got a 75 chance of winning versus 25 it seems to be a pretty obvious choice the only time dollar cost averaging works is if the stock stays flat and that doesn't help you it trades within a very narrow range or in this case the fund or if it goes down and as we've said that's very unlikely now the reason that dollar cost averaging is so appealing to people is they have the very reasonable fear of what happens if i if i put that money in my roth all at once and then tomorrow's the day that the market plunges 40 and the market is a very volatile beast it is it is possible that it could plunge 40 the next day it's unlikely that it'll be that particular day but the market does plunge by 40 on a fairly not frequent basis but on a regular basis that's just part of the process and i can understand that fear but would you what the way to look at it is you say well let's suppose you took that money and you and you dollar cost averaged it in equal parts over the course of the year and let's suppose the the market stayed flat basically so it didn't hurt you to do that didn't help you particularly didn't hurt you and in december you make the very last of those payments and then the next day that's when it plunges 40 so by dollar cost averaging you haven't eliminated that risk you've eliminated for that immediate day but the moment you've made that last payment you're at risk in fact another way to think about that is every moment of every day that you're invested you're running the risk that the next day is going to be when it drops 40 percent and this gets on into a whole another topic we need we might want to talk about which is volatility and and why that really doesn't matter long term and the short answer to that is because while it drops 40 percent is what dropped last spring just about this time actually last year with covet it dropped i think 32 percent within a week or something as a great example what i'm talking about but of course it came back and the market always comes back and it always marches on to greater heights which is why two things to think about market drops one is they're part of the process they're common they're not unusual it's not the end of the world like the media will be telling you at the time and it's just something you have to live with you can't predict it so you just keep going and you just keep investing and by the way last thing on dollar cost averaging obviously if you are building your investments out of your earned income and you're putting aside uh part of your monthly income into your investing by definition now you are also dollar cost averaging but you don't really have an option then you can only invest money that you have right so in that case i'm in favor of dollar cost averaging but the way you presented it which is the correct way is what if you have a lump sum because that's the only time you actually have a decision to make yeah it's it's interesting you say that so last year i you know my wife and i we were we had our money tied up in uh investment property in the flip so when the market when the market tanked i was like man i need that money so i can max it out like i was excited because i figured i can get way more shares so then we end up selling an investment property and then we put some money into it but the chatter was that it would drop some more so i waited to put the rest into our roth iras it didn't drop it went up so i got less shares than i would have gotten if i just put everything in at once so that kind of goes along with what you just said you know it's it's interesting because uh last spring uh i am a big proponent if if anybody's aware of my work or if they after listening to us today they turn to it and they they read it i am a big proponent that market drops don't matter they're always temporary unless until until the united states of america disappears or until civilization ends the market will always recover right because if it were not to recover from a collapse of what for whatever reason then by definition the country is is at an end um so i have a great confidence in that uh with covet last year i had a lot of people telling me you know jim i i understand what you've said i agree with you but this time it's different because this time it's a pandemic well it's always something different i mean the market crashes on a on a you know fairly regular basis it it drops more than crashes too of course in a fair even more regular basis and it's always there's always something that triggers it and it's always something we don't expect and it's always different so what i was telling people the time is it's not different i mean it's different in that that it's it's a pandemic that's triggering it and that's a different trigger but the fact it's dropping is not different the trigger is just different and this trigger is particularly heinous because of course people are dying and that makes it different but in terms of how the market's going to perform it doesn't matter whether it was it was the over-extended uh housing situation in 2008 or the pandemic in 2020. got it so let's let's have a hypo let's create a hypothetical situation we have two best friends they both graduated from college in 2011 they get your book they read your book and they each decide to put ten thousand dollars into vtsax in 2013 unfortunately let's say around march 1st of 2020 one of those best friends he he passed he died the other one on march 25th he saw where the market was going and he decided hey i need to put my money in bonds and keep it safe how would those two individuals accounts look today on march 2nd 2021 well obviously the the fellow who died not that it will do them any good but for the benefit of theirs because he doesn't he didn't tinker with his holdings he has done much better the worst thing you can do with tinkering with your investments is to tinker with them uh warren buffett uh famously said in an interview that i'm going to get the numbers a little bit incorrect but looking at the last century in 1900 the market was trading at 60 i think and buffett said it was trading at 60 in 1900 in 2000 it's closing at 11 650. how do you possibly lose money in a market like that of course the answer is you try to dance in and out of it that's the answer buffett gives nobody can time the market so your hypothetical guy who says i'm you know i see this covert thing coming i'm going to go into bonds uh let's suppose that that he he made that decision before the market crashed he just had better vision than everybody else around and he got out and the market crashes that he's safe in his bonds and then his vision is so good that when it gets down to that 32 level point he says ah this is the bottom and then he gets back in and he's holding until now obviously he's done far far better he's also done something that's not really possible i mean it's it's he's got to get two things right and then if you're gonna that's the way you're gonna invest you've got to get those two things right over and over and over again and i certainly wasn't hearing anybody who was selling because of covet and the market dropping when it was down 32 saying now's the time to get back in they were all saying it's going to go lower nobody can can time the market and how can i say that so confidently well if you could time the market in the way i just described reliably you would be a hundred times a thousand times richer than warren buffett and far more lionized it would be the ultimate financial superpower and so if anybody actually had that superpower we would be aware of it just like if superman were out around leaping tall buildings in a single bound we'd notice and there was only one person i think in the 80s that actually accurately predicted it but it was by luck correct because everybody was predicting yeah so i i'm not sure who you're referring to there's are you if you're talking about the uh black monday in 87 yes 87 yeah yeah so in 87 there was a there's a woman on wall street i think she was very fairly had a fairly junior position with one of the firms her name was elaine garzarelli and in for anybody who doesn't know in in october i forget the exact day but in october 1987 the stock market took the single biggest single day plunge in history to this date dropped 25 in a day it's never happened before hasn't happened since in one day and this woman elaine garzarelli and this happened like october and somewhere around late august early september she predicted that it was going to do this maybe not in a day but it was going to take this massive dive in the very near future and she was right and it was documented a lot of people after the fact claimed to have predicted things but in her case you know she was on the record with her clients as telling them that this was going to happen so was documented of course she immediately shot to great fame because she'd made this prediction and everybody was assuming this woman has the magic touch she can see the future well of course she can't and she was never able to repeat that accomplishment not because there's anything wrong with elaine garzarelli or not because she suddenly got stupid i'm sure she was the same bright accomplished woman after is before it's just that the world must took luck for skill so the analogy i like to draw and and we do this all the time and people on wall street prey on this they try to create the image that they have this skill because of course money flocks to them if they do but the analogy i use is let's suppose as recently you know the lottery was up to some extraordinary amount of money right so you know let's let's suppose you're sitting around and and you're talking about it with your friends and you all go buy lottery tickets because why not you know if you can win a billion dollar lottery and by golly one of your friends wins you know one of your friends happens to be the the person who who had the winning numbers now you're all going to be congratulating you're all going to be trying to be much better friends with him but none of you are going to sit back and say holy cow charlie figured out how to win pick winning lottery numbers no you're going to be sitting back saying holy cow charlie really got lucky because of course that's what happened charlie didn't discover some new way to pick lottery numbers somebody's numbers were going to come up and it just happened to be charlie's going back to wall street at any given time somebody because there's so many people predicting what's going to go on in wall street somebody is predicting what's going to happen just because there's so many predictions being made so somebody in fact more likely some several somebodies are going to be right no matter what the market does doesn't mean that they have have predictive powers it means that everybody's buying a lottery ticket and somebody's going to get somebody's numbers are going to turn up great great points well you know i will say this and people they think i'm a financial expert because i talk about finances a lot so i do have people reach out to me quite often and one thing that frustrates me is when you know people ask me for advice or whatever and i say like for instance last year when the market tanked i said i told you do not sell don't sell don't sell you sell when the market is low then you're locking in your losses and i know at least three people that sold you know at the bottom of the market so that just proves like when you get in you have to stay in long term and you can't dance in and out the market like you said yeah i you know i i think that might be the single most critical thing to being successful at least if you find the simple path that that i advocate and i have said on many occasions and i've written it on my blog that my approach doesn't work if you're gonna panic and sell in fact if you're gonna if you're gonna panic and sell when the market's down my approach will leave you bleeding by the side of the road you should not you should not be doing what i recommend it depends on you being willing and able to weather the storm in fact i i did a guest post from a friend of mine a couple of years ago i can't think of the exact title but if you if you go on the blog you're curious and in the search bar you put in warm because that's the acronym he uses and i don't remember what those letters stand for but you put in warm and he talks about an all-cash strategy so it's very important in investing before you put in a dime to to really understand the philosophers say know thyself right it's critical and there's nothing wrong with with looking inside yourself and saying you know what i know that i couldn't tolerate seeing 40 of my investment disappear overnight there's nothing wrong with that you know that doesn't make you a weak person or a lesser person it's just your psychology and if you feel that way if you're looking deep inside yourself and you say you know i know that if the market drops 40 50 percent i it's it's it's i don't just don't want to deal with that i don't wanna it's not a psychological thing that i wanna have to deal with then you should find a different investment strategy than the one i outline because you've gotta be willing to ride those storms and you've got to be willing to know not just in your head but in your gut that the storms however terrible they seem with all the media screaming about you know the world's coming to an end that it's not true and that things will get better might take a while might take a couple of years you know the turnaround last year was phenomenally quick we can't expect that all the time but you have to know and then if you're if you're building your investments over time those drops actually actually work in your favor because if you're putting the same amount of money in every month as my daughter does now then every time the market drops you get to buy shares on sale that's a good thing in fact i've said that for young people who are beginning to build their wealth the best thing that could possibly happen for them is a major market crash because they're just beginning to put their money in and as long as you keep putting money in the market crashes actually work in your favor but again you gotta you gotta tie yourself to the mass not let the sirens lure you onto the rocks i agree with you 100 so let's say someone is ready to you know begin saving for their future and they they're you know they're terrified of the market they whatever you said today doesn't make any difference to them they say i'm just going to put it in a online savings account or in bonds or something very safe what would you say to them especially considering they have maybe 30 to 40 years until retirement yeah well that that's the first thing i'd say i would say is is go to my blog and put in warm and and read that guy's post on basically holding and investing in cash um you know it's i would never try to talk somebody out of that because they may what they may be saying to me or to you is that hey i understand my psychology well enough to know that well i might know in in my head that when the market crashes it's gonna come back in my gut i know i'm gonna i'm not gonna be able to handle it and i'm going to sell and then as i say if you sell when the market crashes my approach is going to leave you bleeding by the side of the road you'll be better off with just cash or bonds the problem with that is especially long term is that stocks so dramatically outperform that you will have a much longer road in accumulating wealth than you would otherwise and so again i would i would never say to somebody who said i i just don't want to take the risk of stocks i would never try to persuade them to take it but on the other hand i think it's a great tragedy to invest your money for 30 years in something that is you're going to be running hard to stay in place because you're also losing money to inflation you know the value of your cash is going down so stocks are an incredibly powerful engine for building wealth but they're incredibly volatile and you have to be willing to tolerate that volatility and when it comes to balancing so question i get frequently is well how much stock should i have versus bonds right and bonds are balanced in your portfolio that's why they're there they're there to to smooth the ride the wild ride of stock volatility so the more bonds you add the smoother the ride will be but stocks dramatically outperform bonds over time so the more bonds you add the lower your performance over time will be and only you know every individual has to make the decision for themself as to what's more important to them performance or a smooth ride this goes back to the psychology thing we talked about earlier um with debt where i say you know i'm i'm a believer in adjusting your psychology rather than adjusting your investments to your psychology because adjusting your investments to your psychology is is expensive over time in terms of lost but again if you got to be sure you can actually adjust your psychology there's some great points this is great questions by the way thank you yeah i appreciate that i appreciate that so you know obviously we talk about financial security and i believe part of being financially responsible and being financially secure means that you have to have a solid emergency fund in place what do you think about emergency funds how much should you have and where should you park that money so i i'm a little bit of a contrarian when it comes to emergency funds so i i don't i'm not sure everybody needs to have one i don't have one as an example so the wealthier you are the less you need an emergency fund and that's probably pretty logical depending on on on what you have in your life also depends on whether you need an emergency fund so for instance let's suppose you live in a city and you rent an apartment and you don't own a car well there are very few economic emergencies that are going to affect you well let's suppose that you own a house and you're out in the suburbs and you own a car maybe a couple of cars and maybe the cars are older because you haven't fallen into the trap of car payments so that's a good thing but now you know older cars break down occasionally and so maybe you gotta you'll be hit with a 1500 transmission repair out of the blue or maybe the water heater in your house goes out well now you need a different emergency fund especially if you don't have a lot of invested assets so the more invested assets you have the less of an emergency fund you need so if you are completely out of debt and you have some assets going on and you have good credit which you probably do i would say i wouldn't i wouldn't have an emergency fund because again and if you have one by the way and you need to hold it in cash so cash is pretty unproductive i'd rather have the say two thousand dollar emergency fund invested in earning money for me and then if i have an emergency i'll drop it on my credit card and because emergencies by definition don't happen all that often so there's a lot of different ways to look at them but if you're going to have one if you decide yeah you know i i don't have a lot of invested assets uh maybe i'm still working my way out of debt actually if you're working your way out of debt i would not have an emergency fund i'd put it against the debt because you can always use your credit card for the emergency if you have to better to pay off the debt now and if you have to add the debt later you know then you do that but if you're even and you know you've you've got some things that might cause you emergencies like a house or a car then keep it and keep it in cash yeah so we had the vanguard money market fund and that's where we have our escrow for our home taxes that's where we will keep our escrow for the next year roth ira and that's where we will basically hold everything but i will be incredibly frustrated because when you look at it it's like there's zero yield basically i'm like man i could really be doing something else with this so this year for the first time we actually have that money sitting in stocks and well index funds yeah yeah so it's like hey if if the market goes up 60 to 75 at a time it makes more sense to keep that in in index funds than in a cash account which is literally bringing you nothing so yeah i appreciate that if somebody wants to get started with vtsas because they read your book they listen to this particular video or the podcast i will tell you the only thing that frustrates me about vt sax is that you need three thousand dollars to get started right yeah so the alternatives i've seen if you have a thousand is that you can do like a retirement 20 60 account and i believe there's only it's only a thousand dollars but it's like 90 in vtsax and then a little bit in the bond fund or something like that or you can do vti which isn't etf can you kind of explain what an etf is so that if someone who wants to get started with vtsax they can go ahead and get started through a vti or some kind of etf sure so first of all let me say that i i agree you just you just name two really good ways to get started so i agree with you on both those uh and vti which is as you mentioned is an etf etf stands for exchange traded fund and without getting too deep in the weeds vti home owns exactly the same portfolio as vtsax so when you own vti you own the same portfolio as vtscx they are interchangeable in that regard vti the exchange traded fund it was designed to allow you to buy the fund like you'd buy a stock and so you can buy just one share of vti and i haven't looked at it recently i think that's like a hundred bucks a share or something now so you could literally go and buy one share of eti from vanguard so there'd be no uh commission on it and and now you're in the game for a hundred bucks or 150 bucks or whatever the shares are going for this at this time um and you could hold vta you could hold vti forever and you'd be holding essentially the same portfolio so there you go i i you know i prefer vtsax i prefer the fund probably because when i started investing there weren't exchange traded funds and i'm more comfortable with it and i'm not you know exchange traded funds were created to facilitate trading in these things and i don't believe in trading i i will own my vtsa x literally forever i'll never sell it uh you know when i'm living on it i might sell off tiny little pieces of it to you know to to provide for my spending but i'll never sell it i'll pass it on uh to my charities and and and my kid and and uh she has the instructions never sell it i mean there's just no reason to sell it because you own basically you own the publicly traded segment of the united states which i think is a pretty good bet and by the way if if you don't have faith in the future of the united states and some people don't uh then obviously my approach is also not one that you that you want to follow it does so it does suppose a a belief that the united states has a a good future and that is my belief that's pretty awesome and i agree with you 100 now you know i'm also a fan of fidelity not as much as vanguard but i do love the fact that with fidelity you can drop in 25 a month and that's how i got my my kids started with their ugma uniform gift transfer to miners act or something yeah yeah and and they're doing it into fzrox which is the zero zero fee fund which is pretty similar to vtsax now if someone decides hey we're gonna go ahead and do 25 a month into fzrox once you hit three thousand dollars would you recommend them just go ahead and stay there or would you recommend it to transfer that over to vtsax um so uh i don't like fidelity but not because it's a bad place to invest so anybody who's invested with fidelity can feel confident that you know they have a good investment and i i forget that ticker you mentioned but it is exactly it's fidelity's version of btsax and like vtsax it holds the total stock market index so you're buying the same kind of investment um so what i and i'll talk a bit about my feelings about fidelity which don't have anything to do with investment so much but would i switch it over to vanguard i probably would because vanguard is unique in all investment companies in that it is structured again by jack bogle who's passed away now but he structured it so that we the people who own the funds own the company so there is a direct alignment between vanguard's best interests and the investors best interest every other investment company has to serve two masters vanguard's the only one that doesn't have to as we the investor are both the owners and the investor but fidelity which is a privately held company um has two masters it has you the investor which of course they want to serve well enough that you'll stick around but they also and more importantly from their point of view they want to serve the owners of the company this is true of let's say t row price which is a publicly traded investment company so they certainly want to serve their investors or the investors will go away but more importantly they're trying to serve their shareholders which are their owners so they're their interests are not precisely aligned with ours um the other thing and this is this goes back a long time when jack bogle created the first index fund in 1975 the industry was horrified because it gave a better deal to investors which of course took money out of their pocket and collectively they they did everything they could to strangle the idea in its crib and fidelity in particular that took the lead in that charge fidelity came out with a series of ads making serious charges about indexing including that it was un-american a jack bogle in a brilliant move by the way took those ads and framed them and mounted him in his office class act so i have a little bit of a hostility towards fidelity for those reasons we index funds um are the greatest thing to happen to the individual investor ever and if it had been up to fidelity and the other companies i don't they certainly weren't alone in that they never would have seen the light of day now they provide them because competitively they have to and the last thing i'll say is that with that no fee fund that's great that is no fee and that's certainly good for you the investor but from an ethical point of view it bothers me because it's not like there's no cost to running that fund so by definition they're taking the cost of running that fund and putting it on their shareholders that own other funds and i have a bit of an ethical issue with that so i would rather pay this 0.04 uh expense ratio to btsax loss leader or something like that yeah i think it's a loss leader obviously what they're hoping is they'll get you into their into their fold and you'll be happy with them and by the way in fairness from everything i've ever heard fidelity provides great service uh you know it's you're not going to have to worry nobody at fidelity is going to steal your money or anything like that so it's a perfectly sound place to do business with i don't mean to apply otherwise but clearly they don't want you in the index fund they would much rather have you in their actively managed funds and that will be their hope is that you know you'll make a move over and again in fairness vanguard also has actively managed funds um i'm a little horrified by that personally because it's it's straying from the one true faith in my view that jack bogle created but you know like any organization they want to grow and prosper and they know certain investors want actively managed funds and so they provide them okay you know we're we're getting in the flow we're kind of getting closer to the end you've just dropped some serious knowledge on people let me tell you when i the first thing i learned financially out of college was to buy term and invest the difference when it comes to to life insurance what is your what are your thoughts on that so i i'm not an insurance guy um i've never owned a life insurance uh other than occasionally i've worked for companies that provided it and obviously i you know i took what they provided um everything i've ever heard suggests the term is the way to go because when you buy term insurance you are you are just buying insurance for a given period of time for a given amount of money so that if something bad assuming that you're taking insurance on yourself that if something bad happens to you if you die there will be money to help support your family other kinds of life insurance and again i'm not an expert in them combine aspects of being an investment with providing insurance protection the loss of life and they tend to be very high fee and they tend to be lower performance so i think you're making the right decision to split the two your investments are investments insurance is insurance and that means term is the way to go the other thing i'll say is the only person the only people who should carry term insurance are people who are earning an income that their family is dependent on so if you're single there's no reason to carry life insurance nobody's depending on you if you are married without children and your wife is working or your husband's working there's no reason to carry insurance unless you've created a lifestyle that requires both incomes which i would suggest is a mistake at least in my world if you're married and you have children whether you're both working only one person's working now it's a different story because if one of those incomes goes away you now have a single parent with only one income and also the burden of taking care of those children by his or herself so in those cases i would look at insurance but the more financially strong you become the closer to financial independence you become the less you need insurance because the more you have that powerful investment portfolio backing you up and the whole idea of having an investment portfolio is to ultimately replace your need to trade your labor for income and now your investments are creating the income you need to live on and every every dollar you save and invest makes you that much stronger so it's not an on off switch right the moment you start you get a little bit stronger a little bit stronger a little bit stronger until finally you're there 100 and the further along that path you are the less the less awful it would be to suddenly lose your income and so the less you need life insurance makes total sense that makes total sense to me well you know you have a teacher who is graduating college she's 23 years old and you know she knows she's going to get a pension from her state maybe 60 to 65 percent of pension after she works for about 35 years in order to supplement her retirement what kind of advice would you give to her right now moving forward so i you know i i think that pensions and for that matter social security are probably likely to be there in 35 years for but i wouldn't put all my eggs in that basket and i've never had a well i had a small pension at one point that i cashed out but i haven't had that kind of teacher pension over 35 years which theoretically can be a lucrative one as i as i understand but i would say i'd want to invest so that i had a backup and the worst that's going to happen is the the pensions there and i've got my backup investments and and i even i have even more resources so i guess that would be my advice is i wouldn't personally rely just on a pension and of course the other side of that coin is 35 years is a long period of time and no matter how much you love teaching you know in 10 years you might say you know i this has been a great 10 years i've loved every minute of it but i want to go do something else there's some other new opportunity opened up and now that tension is not necessarily going to be what's definitely not going to be the same as it would have been otherwise so if you depend on that pension you're also locking yourself into the time frame to earn it got it so simply put when we talk about the simple path to wealth you really want to get out of debt and stay out of debt and invest long term early and often in index funds such as dtsax with vanguard if i just had to put it in simple terms that's kind of what we're looking at correct yeah it's it's avoid debt live on less than you earn and invest the difference and if you do those three things you'll you'll wind up wealthy and you'll end up wealthy in more than just money because it's a it's a psychologically healthy way to live it seems to me that's that's great well i have one question before i let you go he said what is the main difference between investing in btsax and bym which is vanguard high dividend yield etf i get the logic of investing in vtsax but it only has a dividend yield of 1.42 while vyms is 3.19 i'm wondering what's the difference between the two so great question um the difference is is it v-y-n v-y-m so v-y-m if it's if it's yielding a high dividend is by definition investing in large uh at least currently stable companies that because those are the kinds of companies that pay high dividends btsax as we talked about earlier invests in the entire stock market so you're basically investing in large cap value funds when you're investing for a dividend and the important thing to understand is that the dividend is only one way that companies return value to shareholders and in many ways it's the least desirable of all the ways because it's a taxable event so the moment your the the year the company pays the dividend now if you have a tax advantage account like an ira this doesn't count but if you own it outside of that the moment you get that dividend it's a taxable event that year you have to pay tax on it so a company instead of paying a dividend for instance might buy back some of its shares that has the effect of making the remaining shares worth more money that puts more money in the in the stockholders pocket a company like tesla for instance isn't going to pay a dividend because elon musk is saying you know rather than paying out the money that tesla's earning i can make much more money for my shareholders investing that money in the business and building it so that's true of a that's called a growth company that was apple until fairly recently apple started paying a small dividend so if you focus on just dividend-paying companies you're going to miss the powerful growth of companies on on the way up and you're going to be investing in a lot of companies that might be on the verge of becoming the next general motors or general electric or xerox or polaroid that had been great companies but are entering the twilight of their existence rather than the the sunrise of it and so there is that risk too dividends are only one part of the of of the equation of how you get value from owning stocks and in many ways it's in my view the least desirable i'm much more interested in growing along with the business i'm happy to get the dividends that bts x goes off so it's nice to have a nice to have that is a little bit of spice on the on the plate if you will yeah and i always have them reinvest my dividends so yeah i do too well jl it's been real i mean we can do this for hours and hours and hours of course i'm up for it if you are we're not going to hold you that long my kids probably are ready to for daddy will come home and have dinner but you know i just want to remind the audience you know we're giving away five copies of the simple path to wealth because whatever jl talked to us about today it's not going to be nearly enough you know when you talk about his stock series on jlcollinsnh.com and his book the simple path as well so once again please like this video share the video and then go over to youtube the wealthy educator subscribe and then shoot an email to the wealthyeducator at gmail.com and you will be one of well we'll pick five people on this coming friday to receive a free copy of the book if you're not one of those lucky five people please be sure to spend the money and get this book and then google jl collins and he there's so much youtube content out there and if you want to change your financial lives today please listen to this man he is amazing he is the fi go and we really appreciate him jl thank you so much for being on the show today we appreciate you and i hope you stay safe out there well the same to you it's been an honor to hang out with you and i appreciate all the great questions and let's do it again another time yes i will definitely take you up on that all right man have a great evening and and uh happy birthday uh to nia hey thank you so much she will be happy to hear that bye now bye-bye

Channel: The Broke Millionaire

Views: 2,632

Keywords: JL Collins

Id: nJw7NEi3ICs

Length: 89min 41sec (5381 seconds)

Published: Wed Mar 03 2021