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emotions are enemy number one when it comes to investing,
Robbins carefully and thoughtfully shows how you can be the master of your investment fate instead of sitting fearfully on the sidelines or getting whipsawed by reacting to market volatility in panicky, damaging ways.
What should you do when stocks plummet? How can you find opportunity when everyone else sees disaster?
Enemy number two is fees.
“the purpose of business is to produce happiness, not to pile up money.”
From 1929 to 1932, the Dow Jones Industrial Average went down what today would be the equivalent of 17,000 points!
That’s a plunge of almost 90%.
never forget about these two ferocious foes of stock market success: fear and fees.
our scheduled 45-minute interview ended up lasting four hours. It was one of the most wide-ranging and probing interviews I’ve done in my 65-year career in the mutual fund industry. Tony’s energy and passion are contagious and energizing; I knew right away his book would have a huge impact on investors.
His first book on investing, Money: Master the Game, has sold over one million copies and spent seven months at the top of the New York Times Business Best Sellers list.
Unshakeable presents insights from some of the most important figures in the investing world, such as Warren Buffett and Yale endowment fund manager David Swensen. Both Warren and David have said time and again that index funds are the best way for investors to maximize their chances of investment success. This book will help that message reach even more investors.
index funds simply buy and hold all of the stocks in a broad market index such as the S&P 500.
Index funds work by paring the costs of investing to the bare-bones minimum.
they follow the ultimate buy-and-hold strategy. We can’t control what the markets will do, but we can control how much we pay for our investments. Index funds allow you to invest, at minimal...
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By simply owning the entire market, index funds also earn the market’s return at minimal annual cost: as low as 0.05% of the amount you invest.
the high costs of investing can confiscate an astounding 70% of your lifetime returns!
Despite these risks, if we are to have any chance for meeting our long-term financial goals, invest we must.
we don’t have to put up 100% of the capital and take 100% of the risk only to receive 30% of the reward
By buying low-cost, broad-market index funds (and holding them “forever”), you can guarantee that you will receive your fair share of whatever returns the fi...
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When others are afraid, you have the presence of mind to take advantage of the turmoil swirling all around you.
Howard Marks, a legendary investor who oversees nearly $100 billion in assets, recently told me, “If you’re not confused, you don’t understand what’s going on.”
Greenspan ultimately served as the Fed chief to four presidents before retiring in 2006.
have seen incredible changes in the world economy,” I began. “So, in this world of intense volatility and insane central banking policies
around the globe, what is the one thing you would do if you were still the Fed chairman today?” Greenspan paused for a while. Finally, he leaned forward and said: “Resign!”
one of the greatest lessons I’ve learned from these money masters is that you don’t have to predict the future to win this game.
None of us likes putting effort into things that make us feel unsuccessful and out of our depth!
Once you absorb this information and put your plan in place, it will likely take you only an hour or two each year to keep things on target.
The list of legends who ended up sharing their insights with me includes Ray Dalio, the most successful hedge fund manager in history; Jack Bogle, the founder of Vanguard and the revered pioneer of index funds; Mary Callahan Erdoes, who oversees $2.4 trillion in assets at JPMorgan Chase & Co.; T. Boone Pickens, the billionaire oil tycoon; Carl Icahn, America’s most formidable “activist” investor; David Swensen, whose financial wizardry transformed Yale into one of the world’s wealthiest universities; John Paulson, a hedge fund manager who personally earned $4.9 billion in 2010; and Warren
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the stock market has risen for seven and a half years in a row, making this the second-longest bull market in US history.
that 96% of mutual funds failed to beat the market over a 15-year period.I
learn to profit massively from the opportunities that fear and turmoil create.
investment success is largely a matter of smart “asset allocation”—
of knowing precisely how much of your money to put in different asset classes such as stocks, bonds,...
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index funds charge minuscule fees, saving you a fortune over the long run.
most people find it really hard to sit tight and stay in the market when everything is going haywire.
the S&P 500 returned an average of 10.28% a year from 1985 to 2015. At this rate, your money doubles every seven years. Thanks to the power of compounding, you’d have made a killing just by owning an index fund that tracked the S&P 500 over those 30 years.
Let’s say you’d invested $50,000 in 1985. How much would it have been worth by 2015? The answer: $941,613.61. That’s right. Almost a million bucks!
example, “we tend to put money into the market and take it out at exactly the wrong time.”
You may also know people who got scared and sold all their stocks in 2008, only to miss out on huge gains when the market rebounded in 2009.
there’s that nagging feeling that a bear market is overdue after years of strong returns. I don’t know about you, but all this uncertainty is making many people fearful—and this prevents them from building wealth by investing in the financial markets and becoming long-term owners of this economy, not just consumers.
corrections and crashes occur with surprising regularity but never last.
you can’t win this game unless you have the emotional fortitude to get in it and stay in it for the long term.
we’re not rewarded when we do the right thing at the wrong time.
Our capacity for pattern recognition is also the number one skill that can empower us to achieve financial prosperity. Once you recognize the patterns in the financial markets, you can adapt to them, utilize them, and profit from them.
Let’s illustrate the tremendous impact of compounding with just one simple but mind-blowing example. Two friends, Joe and Bob, decide to invest $300 a month. Joe gets started at age 19, keeps going for eight years, and then stops adding to this pot at age 27. In all, he’s saved a total of $28,800. Joe’s money then compounds at a rate of 10% a year (which is roughly the historic return of the US stock market over the last
century). By the time he retires at 65, how much does he have? The answer: $1,863,287. In other words, that modest investment of $28,800 has grown to nearly two million bucks! Pretty stunning, huh? His friend Bob gets off to a slower start. He begins investing exactly the same amount—$300 a month—but doesn’t get started until age 27. Still, he’s a disciplined guy, and he keeps investing $300 every month until he’s 65—a period of 39 years. His money also compounds at 10% a year. The result? When he retires at 65, he’s sitting on a nest egg of $1,589,733. Let’s think about this for a moment. Bob
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after the age...
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Now let’s imagine for a moment that Joe didn’t stop investing at age 27. Instead, like Bob, he kept adding $300 a month until he was 65. The result: he ends up with a nest egg of $3,453,020!
You’re never going to earn your way to financial freedom. The real route to riches is to set aside a portion of your money and invest it, so that it compounds over many years.
Some say you should have a nest egg that’s ten times what you earn currently. Others, who are a bit more realistic, say you’ll need fifteen times. In other words, if you’re making $100,000, you’ll need $1.5 million. If you’re making $200,000, you’ll need $3 million.
