99% of Financial Advice Simplified

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I’ve worked in finance for 6+ years.

I’ve also spent over 4,000 hours on Spaces discussing investing with experts.

99% of investment advice can be boiled down to these 21 sentences:

1. Knowing a little about 50 companies won’t make you money, but knowing a lot about 5 companies will.

2. If you want to get rich, invest with weeks in mind. If you want to build wealth, invest with decades in mind.

3. 1,000s of people try to predict the stock market. One of them will eventually be right. This doesn’t mean they knew it.

4. Investing is 10% buying and 90% patience.

5. Losing money investing hurts more than making money investing. Remember this when you take risks.

6. If you're starting from little or nothing, build your Emergency Fund first before starting to invest.

7. Picking stocks is fun, but you’ll probably lose money. 90% of people are better off focusing on indexes like the S&P and Total Stock Market.

8. Personal finance > Investing. Prioritize financial literacy over just learning how to invest.

9. The stock market’s movement shouldn’t determine your investment strategy. Pick a plan and stick to it.

10. The stock market has averaged 10% a year over its history. Don't worry about the short-term.

11. Don’t put more than 5% of your portfolio in a single stock.

12. Risk comes from not knowing what you're doing.

13. A falling stock price is not a good reason to sell. Focus on the business, not its market movement.

14. It doesn’t matter if you own index funds or individual stocks. If you don’t control your emotions, you’ll still lose money.

15. Bull and bear markets both call for celebration. There is opportunity in everything.

16. Rebalance when small positions increase or decrease by 25%. Rebalance when large positions increase or decrease by 5%.

17. If you need money in less than 3 years, don’t invest it. If you need it in 3-10 years don’t invest in 100% stocks. If it’s any time frame above that, invest however you want.

18. You’ll never be able to remove your emotions from investing, but this doesn’t mean you can’t control them.

19. If you want bonds in your portfolio invest the difference of 120 - [your age] in stocks and the rest in bonds.

20. Stocks are short-term risky but long-term safe. Bonds are short-term safe but long-term risky.

21. Volatility and uncertainty are the price you pay for high investment returns. It’s always worth paying.

There you have it!

99% of financial advice boiled down into 21 sentences.

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