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  • The median age in the U.S. is 36.8
  • The median income in the U.S. is $51,939
  • The average 401k match is $1 for $1 up to 6%

A 36.8 year old investing 10% of their $51,939 income with a $3,116.34 match:
With just average stock market returns of 10% would have $1,114,479.31 by retirement.

Join 21,000+ other readers who have learned how anyone, even beginners, can easily make this desire a reality. Download the free ebook: 7 Steps to Understanding the Stock Market.




A Guide to Investing for Beginners— Your Path to Financial Freedom

“Investing is the process of laying out money now to receive more money in the future.”

Most people think they need thousands or millions of dollars to start investing. The good news is you don’t. We will discuss how to start investing if you are new to the whole idea.

There are some simple steps to follow to get started as early as today. And the sooner you start, the sooner you arrive at your destination.

In today’s post, we will learn:

  • Why Invest in the Market
  • Things to Consider Before Starting
  • 6 Perfect Investments for Beginners

Okay, let’s dive in and learn more about investing for beginners.

Why Invest in the Stock Market?

For most of us, retirement is a long way off, which we think we will do later. But today is the best time to start, and most people put it off, either because they fear what they don’t know or feel they don’t have enough money to start.

The stock market is one of the greatest places to create wealth. Of course, starting or owning your own business is a great way too, but that is not for everyone, where the stock market is open for all.

Starting to invest in the stock market seems scary and full of noise, confusion, and the potential to lose lots of money.

But investing is like anything else; once you learn the basics and understand the reasons behind the behavior, it all makes a lot more sense.

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IFB211: Brokers, Index Funds, and Cash Flow Statements

Welcome to the Investing for Beginners podcast. In today’s show, we discuss:

  • Finding and choosing the best brokerage account for you, especially ones that offer no fees, partial share purchasing, and DRIP options
  • The different options to build a portfolio using ETFs and some of the important details to look for when choosing different ETFs
  • The impact of the cash flow statement and some different items to look for and how to read the story they are telling

Today’s show was sponsored by:

Koch Industries – Good Profit

Wealthfront.com/investing

Charityvest.org/ifb

Nordpass.com/ifb

For more insight like this into investing and stock selection for beginners, visit stockmarketpdf.com

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Transcript

I love this podcast because it crushes your dreams and getting rich quick. They actually got me into reading stats for anything you’re tuned in to the Investing for Beginners podcast led by Andrew Sather and Dave Ahern with a step-by-step premium investing guide for beginners. Your path to financial freedom starts now.

[0:33] DAVE:  All right, welcome to Investing for Beginners podcast. Tonight we have episode 211. We’re going to go back to the well in terms of requests for questions that we got recently. So, without further ado, I will go ahead and read the first question, and then Andrew and I will do our usual give and take.

So here we go. Hi, Andrew, I just started listening to the investing for beginners podcast, and I didn’t know where else to get in contact with you. My wife and I have a TD Ameritrade and were wondering, the recommendation is Different for every trade and is that the same across all brokerages. Thank you, Christian. So Andrew, what are your thoughts on Christians questions. 

[00:39] ANDREW: The brokerages I use or do not charge me to make trades. So you know, obviously, you want to open a brokerage account if you want to buy stocks, you want to invest in the stock market, buy ETFs, anything of that sort. And so, the ones that I use personally are Fidelity. I use Merrill Edge; I use ally invest. One more than something like Schwab. So they all work pretty well, but none of them charge. Are you getting charged to charge?

[01:12] DAVE: No, I am not getting charged. I use Fidelity and Schwab, and I do not get charged for it. So I strongly, strongly recommend both of them. They’re both super easy to use, easy to open the accounts and do the funding, they have some pretty decent information on there and learn about different things we want to pick both of them also offer the stock slide or partial shares of stocks which I think is really beneficial, especially if you’re starting out, you don’t have a ton of money to throw at something like Amazon, at 3400, plus shares and dealing $50 You can still buy $50 with Amazon. It also allows for dripping on the stock. It’s super easy to do. So yeah, I’m a big fan of them.

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How Visa Makes Money: A Business Model Breakdown

Visa Inc (V) is one of the leading payment brands globally, as is its cousin Mastercard (MA). Visa provides payment services to over 200 countries, ranging from individual consumers, merchants, financials, and governments.

Visa provides a broad range of services, from authorization, clearing, and settlement for merchants and financials. Fun fact, Visa doesn’t issue any debit or credit cards; instead, the cards come from its clients such as JP Morgan and PayPal.

Visa makes money by selling its services as a middleman between the merchants and financials. Unlike American Express or Wells Fargo, Visa doesn’t make money on interest charged on credit cards.

Visa is one of the more dominant brands globally. It started as one of the first credit card programs in the 1950s and morphed into the global giant it is today by creating a network and protocol that enables it to ease the transfer of money between parties globally.

Learning how one of the global leaders in payments makes money helps us, as retail investors, understand how we can profit in the payment sector with others such as PayPal, Square, and Stripe. Studying some of the world’s best businesses is also a good idea to help us analyze others in the same field, but also others outside of payments and financials.

In today’s post, we will learn:

  • The Visa Business Model
  • How Visa Makes Money
  • Visa’s Competitors
  • Investor Takeaway

Okay, let’s dive in and learn more about how Visa makes money.

The Visa Business Model

Visa’s mission statement is to “connect the world through the most innovative, reliable, and secure payment network – enabling individuals, businesses, and economies to thrive.”

To achieve this vision, Visa works through the many different mediums of payment, such as:

  • Contactless payments
  • E-commerce
  • Digital wallets

Visa is the perfect example of a “multi-sided platform.” Visa’s platform creates cross-side network effects by enticing Visa cardholders more usage, which encourages more acceptance by merchants and round and round the flywheel goes. We can consider the merchants on the money side, and the consumer on the subsidy side of the equation. Visa spends the majority of its efforts to encourage the consumer usage side, which drives the adoption by merchants.

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Dividend Theory: For Big Tech, Dividends are a Moral Imperative

The theory of dividends has long been disputed. As interest rates have declined, dividends have become less attractive. As growth stocks have reigned supreme, dividends have taken the backseat.

In today’s fast, high, and big tech world, we need to reconsider dividend theory.

Shareholders need to push companies, like the big 4 tech companies, to pay dividends as their moral duty.

I’m not saying this altruistically—this ongoing movement away from dividends is sowing the seeds of value destruction for many years to come.

There are several moving parts which are making this clear:

  • Company lifecycles
  • The undeniable upper limits on:
    • Reinvestment
    • Entrepreneurship
    • M&A
    • Stock buybacks

But shareholders aren’t focusing on these.

People, it’s about time to wake up and think about dividends again. My theory on dividends is that there’s a morality about them. Dividends are good. And big tech needs to starting think about them.

To understand why, let me take you through the dreaded upper limits in business.

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The Free App I Use to Find Local Gas Stations That Do Cash Back

With gas prices on the rise, you might be looking for relief at the pump. Rather than sift through long lists of gas stations that do cash back in your area, why not try an app that does it daily for you?

I’m talking about an app called GetUpside.

When you first sign up for a free account, you can get an extra 15 cents per gallon, plus the cash back that local gas stations will offer.

That can mean as much as 30 cents or more cash back on your first fill-up—on a 15 gallon tank that’s a clean $4.50 back! (Have to use a referral code for the extra bonus, feel free to use “FAAPK”, which is Andy’s secret code 😉 ).

What’s great about GetUpside is how you’re not locked-in to a single gas station. At any time you could shop different gas stations, and the amount of cash back available will shift depending on how much they want your business at that time.

So what’s the catch?

Well the key is that there are multiple gas stations on the app, and they are all competing against each other for your business.

Gas stations do that in general, and will play with pricing, to try and attract attention.

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The Evolution of a Value Investor with Jason Rivera

Welcome to the Investing for Beginners podcast. In today’s show, we discuss:

  • The evolution of a value investor with Jason Rivera of Value Investing Journey
  • We discuss Jason’s backstory and how he was drawn to value investing
  • Some of the different metrics and techniques he uses to screen stocks
  • How he looks for different companies, and what drives long-term returns
  • The different mindsets we need to have to be good investors, such as patience and discipline

Today’s show was sponsored by:

Koch Industries – Good Profit

Lightstream.com/IFB

For more insight like this into investing and stock selection for beginners, visit stockmarketpdf.com

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Transcript

I love this podcast because it crushes your dreams and getting rich quick. They actually got me into reading stats for anything you’re tuned in to the Investing for Beginners podcast led by Andrew Sather and Dave Ahern with a step-by-step premium investing guide for beginners. Your path to financial freedom starts now.

[00:00:00] Andrew: We are here for our first official YouTube collaboration. We are joined by Jason Rivera. How’s it going, Jason?

[00:00:07] Jason: Doing awesome. How are you guys?

[00:00:08] Dave: We are doing great. Thank you.

[00:00:10] Andrew: Yeah, I got Dave here with me.

I wanted to start with maybe your background just introduced. What do you do or are in the investing realm now, managing money, whatever it is? And then maybe after that, how did you get started?

[00:00:23] Jason: Yeah, so I run the value investing journey blog had for 8, 9, 10 years, which is ancient in the blogging arena.

We also, I also have our masterclass by value investing masterclass, where we teach students how to find, evaluate and value great stocks faster written a couple of books called how to value invest and on the float, teach people how to to value invest and about investment float. And then, I also managed some portfolios as well for some investment portfolios, and that is the short version of my story.

[00:00:55] Andrew: Like a CFA kinda thing.

[00:00:56] Jason: No, I’m actually self-taught; I’m completely self-taught. I wasn’t able to go to college due to severe health issues in the past. So I’m completely self-taught, and when I say self-taught, most people are like whatever. And they learned from mentors.

I, 99% of what I know is that I know about investing finance is self-taught from books, Google. Because when I first started about 15 years ago, there were no online courses with this stuff. And because I couldn’t go to college, I didn’t have a network of people like to reach out to talk about. My dad was in the air force, and my mom was a stay-at-home mom slash flight.

She worked as a receptionist, so we didn’t talk about things like investing. So I’m completely self-taught no, no certifications, no degrees. I haven’t even taken it. I was about to say I haven’t taken one college course. I took one college course on valuation firms from Aswath Damodaran. I think that’s how you pronounce his name.

Years ago, I could finish the course. Yeah, completely. A self-taught.

[00:01:55] Andrew: You’re in good company. That’s Dave and me too. Or both self-taught then go to school for anything. I’m a huge fan of Damodaran. I know Dave is too; I’ve got several of his books, including those big thick textbooks, his, and yeah, it’s interesting. Like when you’re passionate about something, how.

It can really learn, and things can stick in your head that might not necessarily happen even if you are enrolled. What was it that got you interested? You mentioned you didn’t really have a network of people that introduced you the finance. So was there something that kind of drew you to the stock market investing?

Like, how did you even end up? Like from the very beginning.

[00:02:36] Jason: Yes. So it’s a fantastic question. So this my I’ve always wanted to make money and become wealthy ever since I was a little kid, I don’t really know why. I can’t remember why other than, of course, to make lots of money, who would want to do that?

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Scott Lynn of Masterworks Talks All Things Art Investing

Welcome to the Investing for Beginners podcast. In today’s show, we discuss:

  • The art market with Scott Lynn, CEO, and founder of Masterworks.IO.
  • How art is one of the undiscovered asset classes of the investing world and the opportunities in the art market for regular investors.
  • The different ways that Masterworks helps investors get started investing in art.
  • Some of the great returns, over 14% over the last ten years, that investors can earn with art as an asset class.

Today’s show was sponsored by Masterworks.IO

For more insight like this into investing and stock selection for beginners, visit stockmarketpdf.com

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Transcript

I love this podcast because it crushes your dreams and getting rich quick. They actually got me into reading stats for anything you’re tuned in to the Investing for Beginners podcast led by Andrew Sather and Dave Ahern with a step-by-step premium investing guide for beginners. Your path to financial freedom starts now.

[00:00:00] Dave: All right, folks. Welcome to investing for beginners podcast. Tonight. We have a special guest with us. We have Scott Lynn, founder, and CEO of Masterworks. IO. He is joining us to talk about all things investing in art. So Scott, thank you very much for joining us today; we really appreciate it. And we’re looking forward to this conversation. So I guess let’s start off a little bit. Touch about your background because I think that has a bearing on where you are today. So I saw that you started entrepreneuring when you were 15. So you’re obviously a late bloomer.

[00:00:30] Scott: I liked the word entrepreneuring.

[00:00:33] Dave: Yeah. I don’t know if that’s in the English language or not, but anyway, so I guess, how did you start, being creative? Where did this drive for you come from?

[00:00:41] Scott: It’s a good question. I always think that entrepreneurs are just people that like building things; I’ve always liked building stuff. And I guess in some way, shape, or form, it just eventually translated into building companies. So I’ve always, I’ve always been driven like that actually had a friend of mine.

Who’s a successful CEO. Now we started our first company ever together, I think at age 11. Wow. We just did it as kids. And then this internet thing happened. It’s all history.

[00:01:08] Dave: Yeah. That’s awesome. So you started off in gaming and advertising. So how does that kind of parlay into what you’re doing now?

Did the lessons you learned from that kind of help shape what you’re doing now?

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8 Major Stock Market Factor ETFs and Which Are Likely to Outperform

A factor in the stock market is a set of characteristics, or style, of a group of stocks. Factor ETFs allow investors to immediately gain exposure to different stock market styles. At any given point in time, there will tend to be certain stock market factors which are performing well, and those performing poorly, compared to the overall market average.

Buying factor ETFs can be a great tool in managing a portfolio by giving an investor a chance to participate in the outperformance of a given factor without taking on company-specific risk.

Additionally, staying alert to the recent performance of various factor ETFs can be a great tool in understanding what type of market we have seen lately, what type of market we are currently in, and which kinds of stocks can be likely to outperform in the near future.

Sometimes it is not the skill level of a portfolio manager but rather his/her exposure to a stock market factor which has driven their recent performance compared to the average.

The performance of stock market factors tends to move in cycles, similar to the way that the stock market itself moves in cycles. A factor outperforming in one cycle can tend to greatly underperform in the next, and vice versa. We will discuss ideas around the performance of factors later.

To start, here are the 8 main U.S. Equity Factor ETFs, as defined by Seeking Alpha:

  • Value = $IUSV
  • Growth = $IUSG
  • Quality = $QUAL
  • Low Volatility = $USMV
  • High Dividend Yield = $VYM
  • Momentum = $MTUM
  • Dividend Growth = $DGRO
  • Equal Weight = $RSP

What’s nice about the Seeking Alpha website is that they present the recent performance of these factor ETFs on their homepage, which looks like this:

Click to zoom

When the media claims that growth investing has been outperforming value investing, or that “quality” has been beating “high dividend yield”, you can check their claims by looking at the performance of these ETFs compared to the market and the other factors.

Let’s breakdown each of these major factor ETFs and their components.

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18 Essential Money Saving Tips for When You Are Broke

Facing reality when you are broke is the only way you will get out. Being broke can be temporary if you accept your situation and work really hard to break out of it.

As someone who waited tables for 3 years after graduating with a master’s degree because I couldn’t find a career, I’ve been broke for a while and came up with some money saving tips along the way.

Whether you are just starting out in the real world, or have felt stuck and broke for a while, implementing any of these tips should save you money.

Use these savings to encourage yourself, and find a way to break out of your current lifestyle by doing things differently and striving to also increase your income. You can’t do the same things over and over again and expect different results (that’s insanity), so try some of these to break out of the cycle of poverty.

Note: This is a guest post collaboration from Frugal Kam. She’s got excellent tips on saving money and is an expert at living way below your means by keeping expenses low.

It’s no fun to talk finance for many people, but we need to start with at least the most very basic.

Stop the bleeding!

If you’re paying late fees on credit cards, or paying overdraft fees on your checking account, that needs to stop ASAP.

You will never get things fixed if you’re constantly bleeding out of every paycheck from preventable fees.

I know it can be hard depending on how broke you are, but you have to stop the cycle somehow. With these tips you should be able to get your spending on track, which will get you back to keeping money in your checking account and staying up-to-date on your payments.

Promise yourself you will stop the bleeding by using these tips. Then, stick to the plan. Once you’ve fixed this first step, getting out of being broke will be much easier and doable.

Now, how can we all save some money even when broke?

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Pin Debit Networks: A Guide to This Unknown World

In a survey recently released by the Federal Reserve Bank of Atlanta, U.S. consumers use their debit cards to make payments 68% of the time. And in 2019, consumers used debit cards for almost $3 trillion in payments. Needless to say, debit card usage is a big driver of payments in the U.S. and around the world, and pin debit networks encompass a large part of that process.

With the rise of personal hacking information, particularly our personal financial information, security features like PINs help protect our data.

Most payment processors or merchants focus on credit cards, but the number of debit card transactions equals or exceeds credit cards. Mastercard has over 267 million debit cards in circulation and with over 46% of those customers using at least the card once a month.

Debit cards, linked to our bank accounts, make managing our money easier and help make payments easier, for example linking your debit card to your Netflix account for your monthly payment. Because who can go without Netflix, right?

In today’s post, we will learn:

  • What Is A Pin Debit Network?
  • An Introduction to Online Routing and PINless Transactions
  • Leaders in Debit Card Processing
  • Investor Takeaway

Okay, let’s dive in and learn more about pin debit networks.

What is A Pin Debit Network?

The debit card in our wallet can be processed either as a signature or PIN-based transaction, and the merchant will be charged different rates depending on our choice.

So what is a PIN-based transaction?

A PIN debit transaction occurs when we, the customer, enter our personal identification number or PIN to make the transaction. Processing the debit card as a PIN causes the transaction to route through the debit network instead of the credit card network; more on this is in a few moments.

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Making the Discount Rate Formula Simple – Explain it Like I’m a 7th Grader

To me, one of the hardest parts of understanding a DCF valuation was the discount rate. It didn’t help that the formula was complex. I’d like to make the discount rate simple, using simple words.

Maybe if you can understand the basic concept of the discount rate, it will help with calculating one for yourself, whether for a Discounted Cash Flow (DCF) model or for a Dividend Discount Model.

In my attempt to make the discount rate formula simple, we’ll go over the following:

  • What’s the point of a discount rate?
  • The main components of a discount rate
  • The two major types of discount rates

Let’s start with the discount rate concept itself. Using three birds.

What’s the point of a discount rate?

Warren Buffett has a fantastic way of helping us visualize the concepts of the discount rate formula and its role in a DCF valuation.

He says using a discount rate and a DCF is like the parable, “a bird in the hand is worth two in the bush”.

Think of a bird in the hand as your cash today.

As part of making an investment, you are letting go of cash in your hand, for more cash in the future.

How willing are you to let go of the cash in your hand?

It depends on several things.

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