This has been a big week in stock market news. In terms of “retail investor” news, it doesn’t get much bigger than this. This story has naturally reached a lot of people who otherwise aren’t tuned into how investing works. And newly curious investors are asking reasonable questions like “How does this impact me?”, “Should I be doing this?”, “How do I invest?”. Well, I’m going to give you an answer:‎
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This news doesn’t impact you at all. You shouldn’t be speculatively be buying stocks in failing companies trying to take advantage of the very unusual oddity that occurred this week. It’s academically interesting and certainly is headline news, but it does not change my investing strategy one bit, and it shouldn’t change yours.‎
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What should you be doing? The following:‎
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1. Spend less than you make. If you don’t do this, you have nothing to invest and all is list.‎
2. Invest early and often. Regularly scheduled investments. Monthly or whenever you get paid. ‎
3. Buy and hold index funds. You can open an account with Vanguard, Fidelity, Schwab, Betterment, or WealthFront. My favorite way to invest is to choose a single target date index fund that contains thousands of stocks inside and is tailored to your age.‎
4. Stay the course. Don’t change strategies when you read fantastical headlines about redditors hitting it big or looming market crashes. Keep plowing that money into the market each month. ‎
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This strategy above will make you a millionaire and beyond. Chasing get rich quick headlines is more likely to leave your broke for the rest of your life. So, enjoy the news, but remember to stay the course with the rational way to invest.‎
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As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.‎
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-Jeremy‎
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