Help Your Child Build Wealth (eBook)

A Parent's Guide to Teaching Children To Be Successful Investors

Michael Sincere (Autor)

eBook Download: EPUB

2024
244 Seiten
Wiley (Verlag)
978-1-394-25725-6 (ISBN)

Infos

Build a better future for yourself and your children by making the stock market work for your family

In Help Your Child Build Wealth: A Parent's Guide to Teaching Children To Be Successful Investors, bestselling author and investing educator Michael Sincere delivers an exciting and illuminating new take on the stock market. Perfect for rookie investors with children, this book explains exactly how you can get started as a long-term investor using index funds, ETFs, and individual stocks. You'll also discover how you can teach your kids about investing in a way that gets them excited about building wealth for their futures.

In the book, the author walks you through what the stock market is, how to open a brokerage account, how much cash you'll need to get started, and how you can protect yourself and manage risk through diversification. You'll also find out:

• About new and interesting ideas such as a 529 or custodial plan and their proper place in a well-managed portfolio
• What the difference is between 'active' and 'passive' investing and which path is right for you
• How you can find stocks that perform well over the long-term and how you can use compound interest and dollar-cost averaging to multiply your profits
• Learn about the best investing apps and how to use them with your children

An essential and easy-to-read financial guide for young parents looking to introduce their families to the stock market, Help Your Child Build Wealth is your (and your children's) ticket to a brighter and more prosperous future.

Michael Sincere is a full-time nonfiction finance author with two bestselling books under his belt. His work has been translated into thirteen languages. Sincere is also a featured columnist for MarketWatch and Equities.com.

Textauszug

INTRODUCTION

Thank you for buying my book. I wrote this book for parents and their children, or relatives, or for anyone else who wants to use the stock market to build wealth. Teenagers who are interested in the market can read this book on their own.

I did my best to make this one of the most helpful books about investing you will ever read. If you believe that investing in the market is complicated or time-consuming, I hope to surprise you. I wanted my book to be a fast, enjoyable, and easy read. I teach only the most important ideas—what you and your child (or children) need to know right now.

Believe it or not, making money in the stock market is not that hard, as long as you have a strategy (i.e., an investment plan) and follow a few rules. Even more amazing, you and your child can beat the pros who analyze the markets for a living on Wall Street (where the New York Stock Exchange is located).

According to statistics, your child can beat more than 90% of the Wall Street pros. Maybe you think this isn’t possible or that I am making this up. Nope. Anyone in the financial world knows that 90% of the pros fail to beat the S&P 500 index each year. This fact is not a secret, but it’s not information the experts like to share.

What is the S&P 500 index? To learn more about this valuable financial product, keep reading. I’ll show you exactly what you need to do to beat 90% of the Wall Street pros, and also help your child generate wealth.

Before you or your child can expect to outperform the experts, however, you must know more about the stock market.

WHAT YOU AND YOUR CHILD WILL LEARN

By the time you have read all or even part of this book, you will learn about the following subjects. (Don’t worry if you don’t understand everything on this list, because it will be explained later.)

• Begin by opening a stock brokerage account for yourself. By having your own investment account, it’s easier to explain it to your children. Later, you can open an account for them.
• Invest at least $20 or $25 into an S&P 500 index fund, an investment that matches the performance of the S&P 500 index. In this book, you are going to learn everything you need to know about index funds, one of the smartest financial products ever created. Part I is all about investing in index funds.
• Invest a set amount of money each month into the same index fund, a strategy called dollar cost averaging.
• Hold the index fund indefinitely.
• When you’ve gained more experience as an investor, you may decide to buy individual stocks. Choose the right one and you can make good money. Investing in stocks is explained in Part II.

SHOULD YOUR CHILD INVEST IN THE STOCK MARKET?

Your child may ask why they should invest their money in the market. The answer is simple: tell them that the stock market is one of the greatest wealth-building systems ever created. It is how many people got rich in the past and will continue to do so in the future. The good news is you can get started with a small amount of money.

Since the US stock market was created in New York in 1792, the market has moved much, much higher. Here is a fact: the S&P index has an average yearly return of about 10.26% from 1957 to 2024 (https://bit.ly/3RtDQ9Q).

Depending on other factors (i.e., dividends and inflation), some analysts claimed that the actual yearly return is closer to 15%, while others caution that a return of approximately 7% is more reasonable.

Most important, by following the basic investing strategies introduced in this book, your child can be millionaires well before they are ready to retire. Many people made a lot of money investing in index funds, and your child can do the same.

Fact: If someone had invested $100 in the S&P 500 index in 1928 (before the 1929 stock market crash), that $100 would be worth more than $700,000 in 2024. In comparison, investing that same $100 in a 10-year Treasury (i.e., cash) in 1928 would be worth a little more than $8,500 (https://bit.ly/3XGIOUX).

Fact: A $1,000 investment in the S&P 500 in 2014 would be worth $3,300 in 2024 for an impressive average annual return of 12.68%. A $5,000 investment in 2014 would have returned $16,498 in 2024. A $10,000 investment would have grown to $32,997 in 2024 (https://bit.ly/3VrJmLo).

Money provides financial security. With the right investments, your child (or relatives) can buy what they need, travel, and enjoy the quality of life that only money can bring. I’m not saying that money is all-important, but it does make life easier. As your child goes through life, they will feel confident knowing they can handle most financial emergencies (and without relying on credit cards).

In fact, financial security is one of the best gifts you can give your child. They can achieve this goal by using some simple investment strategies. The idea is to build wealth over a lifetime so they don’t have to worry about their next paycheck or paying for a medical emergency.

Some people spend their money on the lottery, hoping for a miracle. Your route will take longer but the odds of success are thousands of times greater. Fortunately, your child can have a comfortable life without waiting for a miracle.

Your child will discover that over time, stock market investing is the easiest, and one of the most dependable ways, for generating wealth. They will learn to set aside some money each month to buy shares of an index fund. Growth begins slowly, but a pot of cash could be waiting for them when they are older (as long as they follow a few rules).

Your child has a fantastic opportunity to become wealthy. Why? Because time is on their side. In fact, the earlier they start investing, the more money they can make. When you ask many older folks if they have any regrets about their finances, many say they wish they had started investing sooner. Don’t make that mistake: teach your child how to invest in the stock market now. This gives them a chance to have a financially comfortable life.

The good news is you already took the first step: you bought this book. I’ll do my best to make you happy with that decision.

As you keep reading, you’ll find that it’s not difficult to make money in the stock market. The hard part is having the patience and discipline to follow the strategies and obey the rules. If your children can do that, they can continue to build wealth for their entire lives.

Some of you may think that you need a lot of money to make money in the market. Sure, it helps, but it is not true. All you need to get started is a few dollars (or other currency).

The goal is to get into the habit of investing, even if it is a small sum. You can invest as little or as much money as you want. Later, as your children grow older and their income increases, they should be able to invest even more of their own money.

As you may have guessed, this is not a get-rich-quick book. The strategies in here are for long-term investors. The plan is to teach you and your child how to use money to make more money.

On the other hand, I know that for some children, the stock market is about as exciting as learning geometry or trigonometry. If that sounds like your child, be patient. One day, after they see how much money is in their account, their attitude is likely to change.

Right now, my goal is to teach you what you need to know about the stock market so that it is understandable, and hopefully, rewarding. Then you can pass that knowledge onto your children (or other relatives).

Note: If you are a teacher interested in teaching your students about the stock market, my book should meet your needs, no matter their age. This information can be adjusted to any grade level.

Speaking of teaching, it’s unfortunate that most teachers aren’t given much time to introduce their students to investing or money management. Ideally, children should learn about saving money early in life. Instead, most learn how to spend (usually with credit cards), but not how to invest. Perhaps that’s why so many people get into financial difficulties later in life.

HOW TO PARTICIPATE IN THE STOCK MARKET

There are two main ways to participate in the stock market. The preferred way is to be an investor, which means buying and holding index funds and other financial products for long time periods—which could be for years. This has been a proven method for generating wealth.

The other choice is to be a trader, which means buying and selling stocks over a very short time period. It could be a day, week, or a couple of months. Trading is a risky method best left to the professionals who do it for a living. Why? Because being a successful trader takes a tremendous amount of skill and discipline. It’s extremely difficult for anyone to predict where stock prices are headed in the next few minutes, days, or months.

For most people, and especially your children, the only way to be in the market is as an investor. This is because investing is far less risky. Also, it’s easier to make money, you buy but rarely sell, and it doesn’t take a lot of time to learn.

IS INVESTING COMPLICATED?

Some people stay away from investing because they believe it is too difficult to learn. Others believe they...

Produkt-Details

• Erscheint lt. Verlag: 4.11.2024
• Sprache: englisch
• Themenwelt: Sachbuch/Ratgeber ► Beruf / Finanzen / Recht / Wirtschaft ► Geld / Bank / Börse
• Themenwelt: Recht / Steuern ► Wirtschaftsrecht
• Themenwelt: Wirtschaft ► Betriebswirtschaft / Management
• Schlagworte: 529 plan • apps for teenagers • custodial plans • educational savings plan • ETFs • exchange-traded funds • How do I invest in stocks? • how do I teach my kids about money? • How do I teach my kids about stocks? • How do I teach my kids about the stock market? • index ETFs • Index Funds • indexing • index mutual funds • introduction to investing • investing apps • investing for beginners • investing for kids • investing for teenagers • Is the stock market risky? • is the stock market safe? • Mutual Funds • prepaid tuition plan • retail investing • UGMA
• ISBN-10: 1-394-25725-2 / 1394257252
• ISBN-13: 978-1-394-25725-6 / 9781394257256