Speaker 1 (00:02)
Welcome to Old Money, a show dedicated to helping you build the trust fund you wish you were born with. Ladies who lunch, listen up. Life is not about looking rich. I want you to build a life and a legacy that feels rich in every sense of the word. If you're ready to stack cash, talk shop, and trade insider secrets, you're in the right place. These are the new rules to Old Money, so let's get after it. Hello, Rich Girls, and welcome back to Old Money. I'm your host, Amber Frankhuzien. I am so happy you're here today. And welcome, a new listeners. I see you. I see you on the numbers. I'm so happy you're here. Yes, we are talking about old money, values, being wealthy, generational wealth, also living well. And it's not about glorifying old money or things being handed to you. It's about how we're building our own fortunes, both from an internal state of wealth, but also tactically. And that's what we're talking about on today's episode today, my most requested ask yet. I have three questions in my DMs about the same exact topic. And you guys, investing is a big deal.
Speaker 1 (01:11)
We're going to go through so many different topics, things, making it really easy. I want to make this short, sweet, digestible snackable for you. So today we're going to get into a little bit of investing, get you started and help you put your blinders on so you're not overwhelmed by all this financial nonsense like, No, you should not be buying meme stocks. I'm going to walk you all through it. But before we get into that, let's start with this week's Birdie and Bogey. So the Birdy this week was going to be a tourist in my own town of San Diego. Justin and I went to the Delmar Races and watched the Pony's Run. I know that can be controversial for some, but that is what we do here in San Diego. And I find it to be just culturally incredibly interesting. The type of people that show up to the races, you have new money, you have old money, you have young people, you have old people. I saw some kids betting on horses, picking out their favorite names. That's how I do it. I'm not much of a gambler, as you know. But the interesting thing really about this whole horse racing culture is there is so much money in it.
Speaker 1 (02:11)
And we were actually walking past one of the private club areas and Justin grabs me and goes, Oh, my gosh, that guy. He's won three triple crowns. And it's this old guy and a sports coat, long hair. It's like a fat cat in Del Mar. And people are walking up and giving him fist bumps. And it's crazy when you're in these industries and the amount of people that it takes to run the show, I mean, from picking up the sh*t to being a jockey on the horse, it's an incredible industry. And one of the things that we talked a lot about this weekend was this whole new program that's becoming more popular of people investing in racehorses. Now, I don't know if you knew this, but you can actually buy shares of a racehorse. And the way that they do this is it's called a syndicate. Syndicate. You'll also hear the term syndicate in real estate investing. A lot of multifamily investors will create a syndicate, meaning they pool a bunch of people's monies together to invest in a project or a place or whatever. In this case, it's investing in a race horse. And these syndicates pool money.
Speaker 1 (03:17)
And when they're selling you, they're like, Oh, it's this breeder and this is the stud and la la la la la la. And what's really interesting now is watching these people who are getting involved in investing in resources, walking around in Del Mar, feeling big, feeling like the big guy on campus. And we were watching the paddock where they take the horses out before they race them and they also cool them down when they bring them back off the track. And you could tell there was this group of young... I was young couples. They were probably in their early 40s and they were all dressed up. Here's the thing. Just a hot tip. You're not supposed to wear a hat or a fascinator to the races unless it's opening day or the Kentucky Derby. It's just not appropriate. You only wear it on opening day, if at all. And these women were so dressed up and they were not dressed appropriately for the track. I mean, we're talking club wear, stilettos. And you should probably in a T-length or longer dress definitely wedges if you're going to do a heel, preferably boots if you're going to be walking on the track.
Speaker 1 (04:21)
And these women were so excited. They're like, We have to get our picture. Our horse just won. They go to take a picture in the paddock and they were so excited about going to take a picture right in front of the monument. They all walked through a bunch of horse sh*t and got it all over their shoes. And one of the guys was wearing Stan Smith white adidas sneakers and just covered in horse sh*t. And I was mortified for them. But it's the difference between having done it before being there or experiencing it for the first time. And that's something somebody maybe old money would look down their nose at. I just look at them with a lot of sympathy and support because it's embarrassing and it's absolutely entertaining to be on the other side of it. So the thing that I will say is I know nothing about investing in racehorses. We're going to talk a little bit about investing today, but Del Mar races are always a good time. On the bogey side of things, I need your help. I have been waking up every single night for weeks on end now. At 3:00 am.
Speaker 1 (05:22)
On the dot, every single night. I literally wake up in the middle of the night and I haven't been able to sleep through the night for weeks. And no, I do not have a new baby at home. My dog is sleeping through the night. She's not waking me up. There's nothing that's happening that's waking me. It's my own chemistry. And what I've realized in doing some research is that it is my cortisol that is really effective at protecting my sleep. And it was TikTok that brought this to my attention, and I share this in case it might help you as well. But this TikToker did this great demonstration of what happens to your cortisol when you're sleeping. You actually produce the most cortisol, and that's again, cortisol is a stress hormone. It's what contributes to belly fat or keeping belly fat in your mid-region. It is one of the chemicals that is dumped by your body as a hormone in response to stress. And when you have elevated levels of stress over time, your cortisol raises. And it's not great for your body because it keeps you in that fight or flight, panicky mode.
Speaker 1 (06:21)
And I feel as though I've just become so adept at managing high levels of stress that I feel happy on a day to day. But something's obviously going on the underlying. I wouldn't say on a day to day that I'm super stressed out or miserable, but apparently I am because I can't get through the night without sleeping. Anyway, your cortisol releases the most, your body releases the most cortisol at night while you're sleeping, and it releases it in accordance with when you should be waking up, because when you have the most cortisol in your body, it's when you're going to be the most alert. So it produces overnight to wake you up naturally when the sun comes up six, seven, eight o'clock. But what happens is when your cortisol is already at an elevated state, imagine you have two cups of water, and there's water in the cups that determine how much cortisol you already have in your body. If you have a normal amount when you go to bed, your cup should be pretty low. If you have an elevated level, your cup might already be halfway full when you go to bed. And then as your body produces cortisol, so imagine you're pouring more water into both of those cups at the same rate, same amount of time, the cup that already has more cortisol in it, it's going to overflow at three o'clock in the morning, as to the cup that has a lower amount in it, and it overflows at eight o'clock in the morning when you're supposed to actually wake up.
Speaker 1 (07:36)
So my whole life right now has been managing my cortisol and all of the things that I've been doing to manage my stress. So I've been trying to read before bedtime, Less Blue Light. We know that's always really helpful. I'm actually reading a really enjoyable book right now. It's called Block Party by Jamie Day. For my readers out there, it's like a thriller, neighborhood drama. It's light and it's not keeping me up and giving me nightmares like the last book that I read, which freaked me out. And I don't remember the title right now. Anyway, I've been reading Before Bed as opposed to watching TikTok. I'm actually on a TikTok vacation. I'm not engaging on TikTok at all. Adrenal tonic from symbiotica is going into my tea every single night. I'm taking extra ashawaganda. That is a root herb that helps manage stress levels and take care of your adrenals. And I'm doing more yoga. I'm back in yoga game. I'm doing my meditations every morning. And then just the whole concept, like anything you Google online about managing your cortisol, it says just reduce your stress level. Well, that's a great suggestion. Kind of impossible.
Speaker 1 (08:39)
We're all running businesses, running families, doing the most. But what I've really noticed that I could use help with is getting more support in my life. So recently I've gotten additional support in my business. I have gotten additional support in my personal life with a new therapist. So we're trying, we're on this journey. If this is something that's happening to you too, and you have any suggestions on this, please let me know I am dying for a full night of sleep. So if I go off the rails on today's podcast, at least you know why. So let's get right into it. I want to get straight to the point today, and we're going to focus our talk on one thing in particular as it relates to investing. And for me, it's been the absolute game-changer because it has helped me manage my stress about investing. And so we have to kick this off with a new segment. I love a broadcast moment. I love a bumper. I love the birdie and bogey little sound effect is a huge hit. So we needed to come up with another one. And you've heard of the term mailbox money, right?
Speaker 1 (09:38)
That's when you have passive income and checks show up in the mail passively for you. Mailbox money is a good thing. Well, for me, there's nothing more valuable than getting a DM from you, getting a question, an email. It's oldmoneypodcast@gmail. Com, by the way. When you send me something and you ask me a question, that is like a check in my mailbox. Nothing makes me happier. So with that, I am happy to announce our newest segment, which we're calling Mailbox Money. That's when you're sending me your love notes, your questions, comments, thoughts, and prayers about anything related to becoming rich or living well. And I'm going to answer them for you on the podcast. And today's first piece of mailbox money is from Emily. And she writes this great question that echoes two other DMs that I've also gotten, which says, What I don't know a lot about is investing. Where should my money be? Should it be in savings, the stock market, a retirement account? Please help. And what a good question. I think it's something that we've all asked like, Am I doing the right thing? The very annoying thing about building wealth is that it's quote-unquote, relatively simple, right?
Speaker 1 (10:47)
They say spend less money than you make and invest the rest. But how do you know if A, you're spending too much money on yourself, B, investing enough in retirement, C, putting your money in the right places? There are so many things to focus on and there are so many different ways to do this. And the reality is I want to put you at ease because there is no right or wrong way to do personal finance. It's personal to you. Everybody's circ*mstances are going to be different. If you're younger, you don't have dependents, you don't have kids, you don't own a home, your investment strategy might be wildly different from somebody who's nearing retirement or somebody who has kids or somebody who's saving for college. There are no hard and fast rules, but there are principles to investing that will really help guide your strategy and guide your decision making. And these principles and these values, I'm looking at them like, what have we learned from the past? What are the old money traditions? And then what are the new rules to these old money values? And that's what we're really going to talk about today.
Speaker 1 (11:49)
Emily, to address your question head-on, if I were speaking to you point-blank, I would say first of all, before anything else, you're going to pay yourself first and make sure you have enough money in your savings account. That means having an emergency fund where you have money in case the worst happens, like you lose your job and then you need money for rent the next month. So we look at what your burn rate is per month, meaning if you are living at the bare minimum, how much does it keep you to, quote-unquote, keep the lights on, pay your rent, pay your bills, pay your car, pay your insurance. That's what your burn rate is. And then we need to get to a three-month, six-month or 12-month level of savings. Now, I wouldn't be just saving money forever and putting it in a savings account. Go back to the savings episode to talk about high yield savings, but it's prioritizing. And you have these different cars on the track that you're trying to get to go all at the same time. I would get some emergency fund saved, then I would make sure that you're also putting a lot of money into your 401K.
Speaker 1 (12:45)
Let me just pause really quickly. We should play a drinking game on this episode. And the drinking game is every time I say this is not investment advice, you take a shot or you put a dollar in the bank. I don't know. Because I've got to say this disclaimer, I know it's already in the podcast bumper, but this is not investment advice. This is just rules of thumb, principles. These are just ideas. This is what I would do. How about that? But the reality is if you have a employer that's going to have a 401(k) with matching and you can put money into a 401(k) and you get it matched, you're getting free money. And if you don't do that, you're leaving money on the table. If you're a young person, investing in a 401(k), especially one with match, is going to get you so far so fast because it's doubling your money that you're putting away for retirement. Now, we're going to have a whole other episode about retirement. I have people to come on and talk to us about it. I can tell you what I know. There are other retirement vehicles like a Roth IRA, traditional IRA, whatever.
Speaker 1 (13:42)
That's not what we're talking about today. We're talking about just building wealth. We're talking about, should I invest in stocks and bonds and real estate, other businesses, gold, commodities? There's a lot of different options out there. And I want to debunk what you think you need to do, because what I hear a lot of people talking about is that they don't feel comfortable investing because they can't keep up with the economy, with the markets, with CNBC, with the ticker tape. You all, it's absolutely chaotic. And it's not good for your cortisol or for mine to watch any financial news or try to stay up to date on what's happening with all of these individual companies that we would be potentially investing in. Get this, day traders, those are most retail traders that are trading on a day-to-day basis lose money. They're gambling. They are betting on racehorses. They're doing as much as I am doing at Del Mar racetrack of picking out a horse with a cute name and saying, Let me put my money into that and see how it does. And sure, you might have some information about the company or the horse like, I heard this guy talking at the races and he goes, Oh, they're running a mile on the track and it's on grass and that particular horse is from Ireland, so it's going to do well.
Speaker 1 (14:52)
Okay, maybe that's rationale for why you have a better chance of things winning. But the reality is if you're going to play day to day, it can very quickly turn into gambling because you'll never really know what's going to affect an individual company. And that brings me to what we're talking about today and what I want to introduce you to, which are index funds. I don't know if you've heard of an index fund, but I could guess that you've heard of a mutual fund. It's a term that's thrown around a lot more quickly. But let's break down what this means. A fund is a collection of stocks, a collection of different companies in one fund where you can buy shares of this fund and your share of the fund represents a little piece of all of these different companies that are included in that fund. Let me give you an example. Let's look at Bravo, the television channel, as a mutual fund. And within the mutual fund of Bravo, there are all these different companies or shows, if you will, that would be a part of this fund. So you've got Real Housewives of New York, you've got Real Housewives of Potomac, you've got Summer House, you've got the random shows like Dancing Queens on Peaco*ck or my favorite, Real Girlfriends of Paris, which I am so sad to report did not get canceled.
Speaker 1 (16:09)
So you have big shows, big budgets. You have small shows, small budgets, and they all might perform differently or be profitable. And overarching on this mutual fund is our finance bro who's overseeing what's happening, who is Andy Cohen. So he's managing this fund. He's seeing what's working. He's got advisors, et cetera, et cetera. That's one mutual fund. Well, what about another mutual fund that might be run by another finance bro? Let's look at like Barstool Sports, Dave Portnoy. Do you want to put your money in Dave Portnois's hand? Because he's really representative to me of a couple of finance bros that I know, but no shade to finance pros, but let's consider it. You have all of these different shows. You have Dave Portnoy getting in trouble in the media. You've got deals that fall through with ESPN or Penn Sports. You have the dissolution of Alex Cooper and Sophia with an F over what's that called? Call Her Daddy. You guys are screaming at me, Call her daddy. And that was one of the biggest pieces of the portfolio, and then it's totally changed. And there's a lot of volatility there. And the reality is that both Andy Cohen and Dave Portnoy, as the head of these media companies, are like the head of the mutual funds because that's the key to a mutual fund.
Speaker 1 (17:20)
It is a collection of stocks or companies or shows or media pieces, whatever you want to call it, whatever analogy works for you, and they're controlled by a person. They're controlled by a human. And that, for me, can be an interesting place to be in because not only are you relying on somebody else's judgment to make decisions about what's best for the mutual fund, but that person is often making a lot of money in commissions and in management fees. And we're going to talk about this. I have a great question from my friend Jordan about her financial advisor, and we can talk through a decision tree about, is a financial advisor a good investment? Depending on where you're at in your wealth-building fund, because I have a lot of opinions about that. And while, again, this is not investment advice, I would say that mutual funds are probably more commonly known and talked about, and people really invest in them a lot, especially through something like a 401(k), but index funds are where I want to turn your attention to. And the reason that I like an index fund, it's because if, for example, Bravo was managed by an algorithm like your TikTok For You page, and it automatically adjusted what was shown on the channel based on what you liked or what was popular or what was performing well.
Speaker 1 (18:35)
They have below deck marathons like every other day on Bravo. And we're like, okay, cool, that was a really sh*tty season, and we don't need to see it again. But what I would love to see is just like, Give me some scary island. Give me some Did you go to Bass Lake? Surprise me, delight me. And that would be something that would be on my channel regularly because it automatically adjusts. And that's what an index fund typically does. An index fund is going to use an algorithm, and normally they're in exchange-traded funds. Again, these are pooled investment security. It operates like a mutual fund, but it's often very much less expensive. There are much less fees. There's not a human controlling it. There is an algorithm controlling it because an ETF is going to be structured to track specific investment pools. So again, an ETF would be adjusting what's playing plate on your channel based on what's performing really well, and that's exactly what an index fund does too. With that being said, just to make an example, and this is not investment advice, but to make an example, one of the most popular ETFs in the first ever was the one that tracks the S&P 500.
Speaker 1 (19:42)
The S&P 500 is a collection of 500 different companies that a company called Standard and Poor's uses to really track the health of the overall market. And the S&P 500 has companies come in and come out. They change all the time. There's criteria of how to be included in that. And again, it's just this benchmark of what's going on in the market. The reason that I invest in index funds is because I cannot keep my eye on every single ball. It's like expecting me to know that Vanderpump rules was about to pop off because of Raquel and Tom's scandoval. And needing to know that I was going to invest money in that ahead of time in order for my stock to pay off like, you guys, I'm trying to run a business. I'm trying to walk my dog. I'm trying to get a blowout. I do not have time to track every single thing that's going on in the market. But when an index fund can automatically make those adjustments for me and get the overarching vibe of what's going on, it tends to work out historically pretty positively. And I'm going to talk you through some numbers.
Speaker 1 (20:41)
Stick with me. I know numbers on the radio are tough, but check this out. If 20 years ago you looked at the top eight S&P 500 companies, they would be General Electric, Microsoft, Pfizer, Exxon, Walmart, City Group, Intel, IBM. You have not heard about all of those companies in a long time. Just to give you an idea of what it is today, Apple, Microsoft, Amazon, Invidea, we can talk about that later, Google again, Tesla, and then Berkshire Hathaway and Meta. That's nine companies, but I thought you should know that Mark Zuckerberg is still on that list. He's hanging on for dear life. Anyway, my point is, 20 years ago was 2003. So when I say things like General Electric, Walmart, City Group, Intel, especially my Folsom girlies, you say Intel, you say, Hey, we get it. Those were things we thought we were going to do well. They're strong companies at the time. But if you would have invested $10,000 20 years ago into each of those eight companies, it wouldn't have worked out so well for you. Get this. If you would have invested $10,000 in General Electric in 2003, today you would have $11,240.
Speaker 1 (21:44)
It's only a 0.6 % rate of return. Pfizer, you would have gotten a 4.7 % rate of return. So you'd double your money a little bit more. Twenty-five grand, ten thousand dollars in ExxonMobil, you'd have 8.9 % returns. 55k in the bank. Walmart, you would have 41k in the bank. That's 7.4 %. City Group, you would have a negative 8.8 % return. You would have only $1597 of that $10,000 left in that investment until you'd get a 4.4 rate of return for $23,500. Same thing with IBM. The only one that performed really well was Microsoft at a 16.3 % rate of return for a total growth to $204,000 from your original $10,000 investment. They're still in the top eight list on the S&P 500. None of these other companies are. And that's how quickly things can change. But if you compare that to a 20-year return of a low cost, very simple S&P 500 Index Fund, such as V-O-O or SPY. Those are ticker symbols. So if you are looking to go buy a share of this index fund, you would look for either of those, V-O-O or SPY. Over 20 years, if you put $10,000 in one of those 20 years ago, you would now have $66,733.
Speaker 1 (23:06)
So out of those eight companies that were the top of the list for S&P 500 20 years ago, only one of them outperformed the index fund, which was Microsoft. And the thing about it is there's no emotional trauma. You're not worrying. You're not worrying about what Microsoft is doing. Or when Bud Light has its big drama with Dylan Mulvaney and their stock tanks, you don't have to worry or manage or monitor each of these individual companies. There's just too many balls in the air. But what you do have is no worry. You just let it ride. And for an annual return of 9.9 %, it's looking pretty good because you're going to have something that automatically adjusts, as I've shared with you, the companies that are in there now are what we're tracking. And the reality is that index funds are such a powerful tool for the investor because with minimal effort, your money is always going to be reallocated into the best companies for you. This is not investment advice. I'm just letting you know that I love an index fund. Are there other funds out there? Sure, there's target date funds, there's all these different things, but there are really good ways to look at things from a holistic perspective.
Speaker 1 (24:16)
And we have the data now to show us that over the course of time, the S&P 500 has always grown. And no matter what crazy Black Swan event happens, whether it's the 2008 real estate recession, it's COVID, it's the recession, it's the dot com boom, it's always come back again. I am, again, trying to lower my cortisol and trying to not manage so many different things. So there are a ton of different index funds that are out there for you to investigate. And you're wondering, That's great. Should I go on Robinhood? How do I get one? What should I do next? How much do I put in? Well, after you're taking care of your other economical needs first, including your savings, your bills, your fun money, because we don't work so hard to just put it all into investments and never play with it, and also investing in your future, your retirement, you're also taking care of just your general wealth building. And what I have done, this is not advised, this is not sponsored, but I have set up a couple of different brokerage accounts just to see over time which one I like best and what's easiest for me to use for different types of investments.
Speaker 1 (25:20)
And I have had accounts with TD Ameritrade, Vancard, Charles Schwab, and Fidelity. I believe that Vancard is the easiest. And Vancard also has a collection of a ton of low-cost index funds. And when I say low cost, I mean like 0.04 % fee versus a 1 % fee. And we're going to talk about this when we talk about financial advisors. It might not seem like a lot now. You're thinking, 1 %, okay, if I have a hundred dollars and I give 1 % away, that's a buck. It's not a lot. But when you have $100,000 or a million dollars or $10 million under management, those numbers add up very, very quickly. And I'd rather that money go in your bank account than in somebody else's bank account for managing your stock portfolio like Dave Portnoid would. Now, especially for people with lots of assets under management, there is very good reasons to use a manager or work with a financial advisor. We're going to go into it later, I promise. Disclaimer, I love financial advisors, I love finance bros. No shade. I'm just saying for if you're a new investor, you can do this. And don't let your fear or your lack of knowledge, so to speak, I'm putting that in quotes, you just can't see it, get in your way of taking action.
Speaker 1 (26:38)
If you sign up on something like a vangard, so to speak, you can really easily look at all these different types of index funds that are through vangard. The one I mentioned that tracks the S&P 500 V00, starts with a V, it's a vangard fund. There are a ton of different index funds out there that track large cap companies, small-cap companies, mid-size companies, emerging markets, European markets, Asian markets, real estate, all these different places that you can play with that are tracking things and automatically allocating. There is a company called the Morning Star where you can verify and look at ratings on different types of index funds. I recommend you do your research because this is not investment advice. Take a shot. And if you do nothing else, the one thing that I would recommend that you do is just set up an account and start to deposit money on an automatic basis. Now, something that I see, I've seen this on Reddit more times than I care to admit of people saying, I thought I put money in an investment account and then it didn't do anything. Because if you put money in a vangard account, you have to actively buy stuff with it to invest it.
Speaker 1 (27:40)
If you just put money there, it's going to sit in a money market account and not do anything. So you have to actually buy. And don't worry about the limit and the call in the draw or whatever they're called, all these different things. There are very easy get started guides on sites like Vancard that will help you make your first purchases. And the way that I have my system set up is that every single month the same amount of money goes into that vangard account. And then by percentage, I can allocate a certain number of dollars to this fund, that fund, this index fund, whatever. And so it all gets to go into the right place and it's all balanced in my portfolio. I usually look at my portfolio once a year to see if I need to rebalance it, and I don't even know how to do that. So that's when I call in the big guns like a fiduciary to say, Hey, does this look right? And what should I buy next? And that's something we'll talk about again as well. But here's the biggest thing that I want to share with you and why this is good for your cortisol.
Speaker 1 (28:34)
It's the piece, you all. It's the piece. If you had all of your money tied up in Tesla, for example, I pray for you because your stress level, every time Elon does something crazy, like buys Twitter or sells all his shares of Tesla or puts a big X up on his building or hasn't paid rent in his building for Twitter in however many months, he's chaotic. Tracking that and not knowing the future of the company because it's led by a volatile leader can be really, really stressful. And not only are there leaders of companies out there like Elon Musk to watch out for, there are people that are working in this economy and are economists or, quote-unquote, professionals in this space that are doing nothing but freaking us out all the time. And if you haven't seen the movie The Big Short, please go watch it. It is actually educational and very entertaining. I love a Michael Scott, Ryan Gosling duo. His name is not Michael Scott. What is it? Steve Carell. Steve Carell and Ryan Gosling in The Big Short and then also Crazy, stupid love, absolute favorite. They're so good together of such good chemistry.
Speaker 1 (29:40)
Anyhow, they're both in the movie The Big Short. And The Big Short really does revolve around another main character who's played by Christian Bell, and that person's name is Michael Burry. And Michael Burry made the bet about the 2008 real estate bubble bursting. And he basically said he's going to short it, meaning he's going to bet that the market was going to fail. And he was right. And it's just come out in the news again that Michael Burry has done another short against the entire stock market. He is betting on the entire stock market collapsing. And you know what? He's also made that bet and that prediction so many other times before. So yeah, I hear that headline and I'm freaking out. I'm like, God, that's so scary. But what you don't want to do is sell all of your stocks based on what one guy says. Because if Michael Burry says it doesn't mean it's going to come true, he's not Nostradomas, he's not Allison Du Bois. This stock market will never emotionally fulfill you. And if you're looking for somebody like Michael Burry to have the answers to all of your investment problems, honey, you got to check yourself.
Speaker 1 (30:42)
And that's why we have these bigger picture strategies in place. So the strategies, they just come from historical data. And one of the pieces of historical data is dollar cost averaging. That is a idea that if you put the same amount of money in at the same cadence all the time, then you're going to eventually buy at the average of the stock price or the index fund price over time. Because if you're always investing the same amount of money on the first of the month, some months it's going to be high, some months it's going to be low, and over time it's going to average out to the middle. I just taught you that secret by just asking you to automatically invest the same cadence every single month. That dollar cost averaging will make sure that you don't buy high, you don't buy low, you buy in the middle. The other thing is you have to keep your money in the market. Investing in something like an index fund is a long-term strategy. You want to keep your money there for as long as you possibly can. There is this incredible book. It's called Unshakable by Tony Robbins.
Speaker 1 (31:41)
It's dense, but also there's a lot of Tony Robbins talking about this on podcast. In fact, he has an unshakable podcast that I highly recommend. And there are so many keys in there. The number one key that I learned is that you're never going to earn your way to wealth. You have to invest your way to wealth, whether that's in the market or in yourself or in starting a business. But here's a crazy stat for you. If you missed out on 10 market days in the last 50 years, you've missed out on 250 % returns over time. So if you don't have your money in the market on those days, you've missed those big jumps. It really does matter to have your money in the game in order to play, and you can't time the market. Again, we're not here watching CNBC, I'm trying to catch up on Vanderpump Rules. And you're going to ask, Well, if Michael Burry is right or wrong, what do I do? And the reality is that we have the historical data that allows us to be calm, clear, and focused investors, because, yes, there will always be market corrections.
Speaker 1 (32:43)
The market can't always go up, up, up. It does go down, and corrections do happen just the same way winter comes every single year. It's cyclical. A correction is when the market can drop anywhere between 10 and 20 %, and it will correct. And a crash is when it goes more than 20 %. But we know historically that the market has always recovered, even after these crazy events like COVID and things like that. So my point is that you can pick your path. You can choose to become a day trader where you're likely going to lose money. You're going to be betting on racehorses every single day. You're going to have very high cortisol and you're going to be awake at 3:00 a. M. Texting me, asking me how I'm doing at the exact same time. And I don't want that life for you. Here's the thing about investing is that that day trader or being really involved in the markets or knowing the earnings reports, it's very sexy and it's very attractive to people when you feel like you're sophisticated with your money. And the Warren Buffett way is to set it and forget it.
Speaker 1 (33:43)
Warren Buffett still lives in the same ass house he grew up in in Oklahoma, and that's not the life I want for me and it's not the life I want for you. I want you to really enjoy your money, and I want you to enjoy it with peace knowing that once you've got yourself set up with the right systems, wealth will come. We have the historical data and we have the systems in place to get us there. So today we're barely scratching the surface. What I really want you to take away is that this is not investment advice and that Amber loves index funds. But whatever you do with your money, I support. However, here's some data to make good decisions so that you're growing your wealth in a really responsible way. And if I could leave you with one stock tip, one actual piece of investment advice, one thing I would say put your money into, it's going to be a book. And you're like, Bitch, I don't want to read a book. That's why I'm listening to a podcast. But I will tell you this book really did change my life. I bought it in 2009, the week it came out.
Speaker 1 (34:38)
I was just graduating from college. And I did read it in all sincerity then, and I didn't action on it until probably 10 years later. And since then, this book has been re-released. He now has a Netflix series of podcasts. He's all over the place. The book is called I Will Teach You to be Rich by Rameet Saeedi. And I am obsessed. If you are getting started in your personal finance journey, this is one of the best books that I have found that really lays out these overarching principles. It talks about things like negotiation, why you shouldn't ever be paying an overdraft fee, how to get out of it, how to negotiate your credit cards, how to pay down debt, how to navigate student loans, and how to start investing. And a lot of the principles that I talk about now, the ones that I've been putting in practice for the last many years, they're things that I learned from Remet, but they're made certain with the information that I've learned from Tony, among many, many others. I've had many teachers in my financial journey, but those two people have been the cornerstones to my wealth building.
Speaker 1 (35:36)
And I want to offer you that as well. So maybe I should give some books away. Would you guys be down for that? I'm just thinking about this now. We could do something on social. Go check it out on social when this episode drops. Let me say this. I'll buy three people some books from Remeet and we can go from there. I'll have to figure out what we should do to make this an interesting contest. However, I want you to feel financially empowered. I hope this episode gave you the tools to feel rich to implement some richness to your life. Let me know what questions you have. We have so much more to cover about all of these topics. Again, my name is Amber Frankhuzien. Reach me on social at Old Money Podcast or send me a love note and we'll do a little mail box money at oldmoneypodcast@gmail. Com. I'll talk to you soon. Bye-bye. Feeling rich? I hope so. Thank you for joining me on this episode of Old Money. If you have questions you want answered, email me at oldmoneypodcast@gmail. Com or hit us up on social. We are at Old Money Podcast and I am at your service.
Speaker 1 (36:40)
If this episode spoke to you, inspired you, helped you, if you took a single note, it would mean the world to me if you could please just take a minute to write and review the podcast. And if you're not doing so already, subscribe. And if you have friends who like getting rich, please share this episode with them, even if it's just on your Instagram story. And I'd love to be more than Jeff Bezos loves Amazon Prime. Thank you so much and I will talk to you on the next episode. Remember, I'm not your lawyer, I'm not your tax professional, and I'm not your financial advisor. The content presented in this podcast is intended to entertain, educate, inspire, and support listeners and their personal and professional development and does not constitute business, financial, or legal advice. In addition to that, this episode may contain paid endorsem*nts and advertisem*nts for products and services.
