“The best time to plant a tree was 20 years ago. The second best time is now.” – Chinese Proverb

Investing is a lot like losing weight.

There is a lot to learn, you can study nutrition and exercise for the rest of your life in the pursuit of good health, but you know it is not rocket science.

If you increase your activity level and lower food intake you know you can lose weight. Investing is the same way.

However, if you do agree with the action step, it is time to do something about it. Take action: open the account, set up the automatic transfer to your pension fund or buy your first stock.

While taking action and creating personal finance habits does not guarantee your success every time you make an investment, it will make the odds of your long-term success almost a certainty.


You first.

To be an investor, you only have to add paying yourself money at the top of your list of bills.

As easy as that. Why wouldn’t investing in your future be as important as paying your telephone bill or your mortgage?

Even $100 a month will get you $1,200 a year, this is a good start. It is great over the years to see your account go from $1,000 to $5,000 then $10,000, $25,000, $50,000 and then $100,000.

Look at it as a monthly bill that its actually not gone, but is paying you back.

Set a periodic, automatic transfer from your day-to-day account to your savings account the day you receive your pay-check.

You can take the next step and buy stock of a top company.


Gavin Belson in HBO’s Silicon Valley

If you are working for a publicly traded company, chances are that you can buy company stock at a discount. This is called ESPP (Employee Stock Purchase Program) and it is tax-efficient.

In the United States the discount can be as much as 15% lower than the market price over a period of usually 6 to 12 months. 

That is free money, my friend.

You are benefitting from the growth of the stock +15%, always. If growth is negative you are still getting the 15% without doing anything.

Now you are not only an employee, you are an investor getting rewarded when the company increases earnings, grows its sales and beats Wall Street expectations.

You are getting paid twice, you will be a capitalist benefitting from your company’s financial success while you work towards your financial success.

You can read more about ESPP here or just ask your company to give you more info about the specifics.


Ron Swanson would be proud.

Two truths in the world, we die and we pay taxes.

We can postpone death with a healthy lifestyle and avoiding physical danger. We can also avoid short-term income taxes by contributing to a tax deferred retirement account.

Depending on the country you live in, pension funds and tax deferred accounts are treated differently.

In the US, you have 401k (employees of businesses), 403b (non-profit workers) and 457b (government workers) limited to $18,000 to contribute that will deferred that amount in tax. Check out the specifics of the country you live in, it may be even better.

As an added bonus, you don’t pay capital gains tax on the returns of you tax deferred account until you withdraw the money.

Your capital grows tax-free. And in the long term, this will save you tenths of thousands of dollars if not more.

4. the 100% return that most people miss

Barry is not “most people”.

Most of the best money managers in the world like Warren Buffett, John Paulson, Paul Tudor Jones and Peter Lynch have about 20% annual returns on average over long periods of time.

What if I told you there is a way for most employees to get an instant 100% of return on their money?

This type of return can be found as near as your own employee sponsored 401k or pension plan program.

So, if you make $50,000 a year and put in 5% of income each month, by the end of year you have contributed $2,500, and your company have matched with an additional $2,500.

Each month around $200 becomes $400 at a start.

In addition, this is pretax money, so you are deferring taxes as well until you take the money out for retirement.

Capital gains and dividends from that investment also grow tax-free.

Now you’re getting higher % returns than Warren Buffett. Boom.

5. THE S&p 500 index beats mutual funds

S&P500 looking at mutual funds.

Over the long-term, 80% of mutual funds don’t beat their benchmarks.

What that means is that the SPY ETF beats 80% of all active managed mutual funds.

This is for three primary reasons:

  1. It has a very small management fee of 0.09%
  2. It follows the S&P 500 index rule based system. It’s managed in a mechanical way and not based on a manager’s opinion or emotions. This is an edge.
  3. It can’t underperform the market because it is the market.

CONCLUSION: what you can do today

  1. Set an automatic transfer to your savings account.
  2. Don’t just be an employee, be an investor via ESPP.
  3. Pay yourself first: contribute to a tax deferred plan.
  4. Set an automatic payroll deduction for your employer to match. Get the 100% return by next month.
  5. Leave your money alone so it can grow over time. Use Index instruments like the SPY.