Thursday, October 14, 2021

Investing for beginners

Hey guys, welcome back to Generous lifestyle with me Lyle Weber.

I'm excited to have you with me today in today's video, we are going to be talking about investing in why it's

 important that you are somebody that invests.

 

So let's open straight into today's video.

 

Well, you might be saying, well, I don't have any understanding of stocks and it's just too complicated.

 I'm not an investor. I never went to school. I never studied finance.

 Well, you don't need to be somebody that's gone to school in order to be a investor if I may put it that way.

 But let's take one step back before we get to what investing actually is.

 I believe that there's three important categories that we need to discuss. Number one is gonna be savings.

 Number two speculation, which I think a lot of times people confused with investing and

 then what investing actually is.

 So savings is where you take a sum of cash and you take it to your local bank or your credit union or to your

 bank and you set it aside in the safe place where they keep it for you and they pay you a little return.

 So you get this minimal return.

 And I believe savings accounts are important for short term goals and also for your emergency fund.

 In fact, I've got a two videos, one on how to determine what the emergency fund is and I'll leave the link below

 and then also how to determine where to put your money, where to save your money, how to determine

 what's a good savings account.

 So general, like I said, there was a short term on the other hand speculation or is pretty much trading, it's

 where you are trying to time the market.

 We're trying to buy low and sell high where you're trying to find a gap in the market.

 So you've got some funds and I want to buy the stock and then sell it quickly so I can make a profit.

 And I think that's oftentimes when people think of investing, they think of the ability to pick a stock and

 into salad off quickly.

 And that's not the purpose to me that speculation that's hoping that you're going to beat the market in order to

 make a profit.

 And yes, there are people that have done that in the past meant lots of money.

 But I believe as people who are good stewards of the resources that God and trust them to us, I believe that

 we need to be investors.

 What investment looks at an investor does is they look at things from a long term perspective.

 So I've got goals. I want to retire at some point in the future.

 I believe in the kingdom, we don't actually retire.

 But I call it three purpose mint because I believe that God always has a plan for me whether I am 10 years

 old or whether I'm 100 years old, so just repurposing.

 But just from what people call as retirement when you stop working generally 65 years old.

 Um, I believe that we need to be setting aside funds that we can continue the work

 that God has called us to do.

 So that might be a goal that when you reach the age of retirement retirement, that you've got funds set aside to

 be able to continue to at least maintain the level of lifestyle that you're living at the moment.

 The other goals that you might have is, let's say you want to buy a house in five years time.

 So why put the money into a savings account and earn 1 to 2% where you could possibly put it in the market

 and you can make 7 to 10 to 12% depending on on what you are investing in.

 Again, if you don't have a proper understanding of these things, go out and meet a financial advisor who's

 view on, on investing alliance with yours, who's got your best best interest in mind.

 Somebody who's a fiduciary and I've actually got a video on, on things to consider when it comes to

 investing in what it is that you should be looking out in a financial advisor.

 Okay, so as I said, savings short term speculation trying to beat the mark and then investing looks at the

 long term, something you might be wondering is, is investing, not gambling.

 I don't think so, I believe in investing is where you take your resources and you're giving it either to an entity or

 in person to manage it or in turn is going to generate some form of income for you,

 but it's a calculated sort of transaction.

 I'm not just going to give my money to somebody that hasn't proven themselves to be able to generate some

 form of income.

 Where is gambling? On the other hand, it's like I'm throwing money in the air and hoping that something's

 going to happen with it.

 Something else that you need to consider is that there are different types of assets that you can invest in.

 We've got stocks or shares opinion where you come from and what a stock is is where you take your money

 and you buy a portion of a particular company.

 So let's say you are in the United States and you want to buy shares in walmart

 or stock in walmart, walmart stock.

 So when you buy that stock, you become a part owner of that particular corporation in South Africa, let's let's

 pick and pay no affiliation to any of these companies, but just as for example purposes, I've chosen us to, so

 you're gonna take your money, you're going to invest in these companies and you will benefit in two ways,

 Number one capital appreciation for the value of the stock actually appreciates what gets by More, for lack

 of a better word.

 So let's say it's $5 today and in two years time it's worth $5.50 or $10.

 So the value of your investment has increased, but not only that, you also earn a dividend on what you have

 invested, the next asset type will talk about is bonds and what this pretty much is the best way for me to, to

 explain this is you become the bank.

 So let's say it's the country or the local government in the place that you live in, even a company, they need

 to raise funds for a particular project and they got looking for money and they might issue bonds and you

 are going to be the person that's going to lend money into them and what you normally get back in return For

 your investment, easiest your capital.

 So let's put $1,000 and I get 1000 back.

 But also I get interest back on that investment and that's normally for a fixed period of time.

 The next sort of asset that people could be investing in is commodities.

 So whether it's oil or gas or wheat, you know, when you watch whether it's CNBC or one of these other

 news channels where they talk about the markets L. A.

 Say that the price of this commodity has gone up or gone down, that's where you're actually buying this

 particular commodities, like gold and the price of those commodities are generally very high level affected by

 the demand for those particular items.

 An example is let's say there's a particular shortage of a particular type of commodity, let's say wheat for

 bread, the price that might go up.

 So if you held onto this and or you bought it today and in two weeks time the price goes up because there's a

 shortage, you could then sell it off at a profit.

 The next type of asset class is going to be real estate.

 So you could either go out and buy a house, you could buy an investment property which might be a second

 property or investment properties where you could then rent it out to people and make income that way.

 You could also, if you don't want to be involved in the day today, there's lots of trust that you could set up to

 or the art trust that you could set up to where somebody could manage it for you.

 In fact, they've actually got a friend and he's a into property and he's, he started off by buying trailers in

 the trailer park, it eventually grew to buy another one and another one and then he bought all trailer park and

 then he bought some condominiums and all this guy does is he has an investment company that manages

 the property for him.

 And one day a month for one hour monthly, picks up the phone just to to touch base with the property

 managers just to find out how things are going and he collects his money each month.

 But again, in that case he's appointed people, they can run the operation for him.

 Real estate, if you look at it, even from a biblical perspective, uh, people that make lots of money tend

 to buy real estate because real estate tends to appreciate, or it actually increases

 in value most of the time.

 Something that I want to point out to you at this point in time to is, so you might be saying to, I put all my

 money in real estate to go out and buy another house

 or houses the properties or do I buy stocks?

 What do I do? There's a concept called risk tolerance.

 So what this basically looks at is how much risk are you prepared to take on?

 Okay, So if I buy shares, its by sharing a particular company and put all my money into that chair, there's a

 possibility I could lose everything if the company goes bankrupt.

 So that's more risky. But what you could do is, you know, the old saying, don't put all your eggs into one

 basket because if it falls, you could lose it all.

 They oftentimes talk about they being financial advisors and, and people in the industry will tell you to

 diversify your portfolio.

 So your portfolio is the different types of assets at your own.

 So maybe having some of your assets in commodities, some of your assets in the form of bond, some of your

 assets, in the form of stock and some in the form of property and so on.

 So you're spreading your risk. If something happens to one particular asset, you are

 generally covered in the other areas.

 So that's something called that, linking your risk tolerance with diversification.

 So the more risky and investment is, the bigger the possible return that you could get.

 But if you're going to take all your money and you're gonna put it into a risky investment, there's a chance

 you could lose it all.

 So how do we protect ourselves against that? We go and diversify our portfolio.

 So just to wrap things up real quickly, let's say you've got some extra cash available and you say, okay, cool,

 I want to invest.

 I'm just, what do I do next? What's the next steps?

 So there's a few things you could do, you could either start off small and take some money and go online and

 use a robo Advisor.

 So you go into most investment companies websites  and there's actually prompts you log in and it will ask

 you questions and based off those questions that you answer, it will kind of guide you like two different

 options with regards to how and where you can invest your money.

 The next thing you could do is also you could contact the Financial advisor and again make sure that there

 are a fiduciary and somebody that's got your best interest in mind at all times and have them manage

 your resources and and make the investments on your behalf.

 One thing to point out with financial advisors is they are going to charge a fee and I believe that people should

 be justly rewarded for what they are doing.

 These are professional people that are rendering your service and helping you manage

 your resources and your wealth.

 So I believe that they should be paid by.

 Just remember that there is a fee with that wifey generally going to a financial advisor compared to if

 you are going to do it yourself.

 And then the last where you could possibly do it is to open up your own online account with a brokerage

 where you then in turn go

 and you invest money with them.

 And that could be either going online or using one of the apps in the States.

 They've got apps like Robinhood and Acorn and there's a whole host of them South Africa, we've got

 easy equities not endorsing any of these, just mentioning that, but you could go out and do that.

 But again, only if you feel comfortable investing should you proceed and do it yourself?

 Speak to people that you know in the industry that can help guide you.

 But ultimately guys, it's important to pray and to be led by God's spirit.

 I'll leave you With this last comment.

 I remember a few years ago, I think it was 2008 with the recession that was about to happen.

 Uh, I was praying one day and I just believe God showed me that there was a recession that was about

 to come and as a result of that, I could pivot what I did

 with my resources and I was protected from the recession.

 I heard of other people who made gains in that particular market because they, who are praying about

 what they needed to do with their investments.

 Their advisors are telling them to pull certain stocks or to pull their money out of certain stocks, but they just

 felt no peace to do so and they ended up making more money in the midst of that

 time where people are losing money.

 So it's important to yes, we listen to financial advisors. 

 Yes, we we read up on the markets but always know that God knows best.

 So you're starting out your journey investing and it's going to get you into a place where the more you do

 this, the more comfortable you'll get with it.

 And I believe that as you listen to God's voice, you lead you with regards to making great financial

 decisions and I believe that this will be a mechanism in which you can actually move from where you are today

 to where God wants you to go in this video helped you guys.

 I ask you two things number one, if you could share

 this video with a friend or family member that you

 believe needs to know more about what investing is.

 And the second thing I ask you to do follow us at https://generouslifestyle.org

 

 

 

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