You've made it to the last leg of the journey.
The climb is steep. You could lose your footing at any time.
There are all sorts of dangers. Freezing temperatures, threatening winds, loose rocks and even avalanches.
Others have tried to climb this mountain. Some have made it to the top.
Most don't make it. Some have lost everything.
But you took the safer path. One that puts an emphasis on preparation and safety. You armed yourself with a safety harness so you can use the climbing rope that's already hooked into the mountain.
Let's get you to the top of the mountain.
Step 5: Wall Street
There's a reason why they call them a bull market and a bear market. At their worst, these beasts are ruthless. Getting in a match with either is high risk.
We all know that investing in the stock market is risky. No matter if you go it alone or hire someone to help you, you are taking on 100% of the risk. And having enough knowledge to make a wise investment could take years to gather.
That's why we hire financial advisors and investment firms to help us.
These advisors and firms tell you to invest in their 401Ks and IRA because they are safe. But 2008 revealed the truth. In just a matter of months, investors lost 40% of their portfolio's worth... many lost more.
Young people had time to recover. Those close to retirement didn't. They had to scramble and find another plan. Some went back to work. Others delayed retirement.
Until then everyone though these were safe investment. But now we know even the "safest" wall street investments aren't safe from a recession or depression. The risk is always there.
None of us have a crystal ball. That's why you built your wealth from the foundation up.
You've protected yourself with a financial safety harness.
You've invested in yourself by starting your own business and gaining new skills.
You've invested in others to create a network of protection. And you've created a cycle of passive income that covers your expenses.
Now, you can take on high-risk investments without putting your retirement at risk. You've reached the last step in the Hierarchy of Wealth. Step 5. It's time to invest in Wall Street.
Wall street has many ways to invest. Today, we'll cover:
401K & IRAs
Mutual Funds
Index Funds
Seed Captal
Hold Investing
Swing Trades
401K & IRAs
This is where most people enter the Hierarchy of Wealth. They've been told by their financial advisor that these are a safe bet as long as you play the long game. Knowing how these types of accounts were formed will give you a better perspective.
Companies used to provide pensions. They had to manage their money in a responsible way to ensure employees had a retirement. But in the 70s wall street came up with an idea where companies could shift the risk from them to their employees. And wall street would profit off the little guy.
They successfully lobbied Congress and viola... the Revenue Act of 1978 was born.
The 401K and IRAs were then marketed as the go-to, safe way to plan for retirement. But investment firms skim the profits off these accounts with fees. According to Nerdwallet, the average American pays over $369,000 in investment fees over the course of their life (1).
And if you need to retire in the middle of a recession, you're on your own.
So are these a bad investment? Not necessarily.
If you're getting an employer match, it's probably worth taking advantage of free money.
No employer's match? Alternative investments like a Feathered Nest Account™ give you guaranteed interest.
Mutual Funds
A mutual fund is a company that pools money from many investors and invests the money in securities such as stocks, bonds, and short-term debt.
These are generally safer than buying stock in a single company, but they usually grow slowly. Because they choose safer investments like bonds, they may not keep up with the growth of the stock market.
With compounding interest, it's possible to make good money if you have enough time.
Check how the fund performed historically before deciding to invest.
Index Funds
An index fund is a collection of stocks that aims to mirror the performance of an existing stock market index, such as the S&P 500.
These are still safer than investing in a single company because you're actually investing many companies at once. And they are companies that have been proven to perform like the S&P 500 or in popular industries like tech or green energy.
If one company goes under it may bring down the index fund a little, but it won't devastate your portfolio.
Look for top performing index funds or ones focused on impact investing.
Seed Captal
Seed capital is the seed money or seed financing used for funding initial operating expenses and development before a company begins to make/take in revenue.
You're basically investing in a startup company and hoping they will turn a profit in the future. Then you can ride their wave of success.
If you get in with the right company, you can make a lot of money. Get in the with the wrong one, you could lose it all.
Doing your research in key here. Just because a company has a good idea doesn't mean they know how manage money. Find people who has a proven track record of using seed capital, learn from them, and validate their research before investing.
Going it alone? That's okay. Consider hiring someone to help you review a company's business plan and financials until you learn the ropes.
Hold investing
Buying stocks and holding them long-term or forever is called hold investing. You hear stories about this all the time.
If you had bought $1,000 of Apple stock in 1980 and held it, you would have $1.26 Million today (2). That translates to a return of 126,360%.
But knowing which stock to buy is the hard part. Companies may go under. They may flourish, then tank. They may grow slowly and be a great investment over time. Or you might find the diamond in the rough like Apple. There's no way to know.
Use caution, know you might lose it all, and don't count on one company being your retirement plan. Diversify across different stocks and different industries spread out your risk.
Swing TradEs
Swing trading is investing in stocks for a short period of time (generally 3 days or more) to try to ride a short-term wave or swing.
You're not committed to any one stock. You're looking for patterns in the market and guessing when to get and when to get out.
You have to be glued to the stock market and news. It's very time consuming.
If you can't manage your emotions, this a very high-risk strategy.
If you want to give it a try, find someone who can teach you how to swing trade and only invest "fun" money... money that if you lost it, it won't matter. If you're depending on $1,000 to turn into $2,000, your emotions will likely get the best of you.
And just so you're not surprised... swing trades are taxed different than hold investing.
You're going to be paying income tax rates for any swing trades held less than year. If your taxable income is $150,000 in 2022, you'd be taxed at 24%. Making $250,000? Now it's 37%.
But if you hold investments more than a year, you'll be paying capitol gains tax at 0%, 15% or 20% rates. In 2022, if your taxable income is under $83,350, you'll pay 0%. Under $517,200 is 15% and over is 20%.
Investing In Wall Street
It's like climbing the highest peaks.
You are taking all the risk. It may pay off, it may end in disaster.
That's why having a financial safety harness keeps you from falling. That safety harness is a Feathered Nest Account™.
You don't want to miss this important step in the Hierarchy of Wealth. You'll have financial security and a solid foundation so high-risk investments have the chance to pay off.
Without the stress of putting your retirement at risk.
That's where I can help you.
Together, we will build a customized account for just you.
It will add the extra layer of security you need before starting on your journey to wealth.
A Feathered Nest Account™:
Earns guaranteed compounding interest. No matter what the market does.
Gives you access to low-interest loans. Even if bank rates are historically high.
Protects you from running out of money in retirement.
Check out my proven wealth building strategy. It's automated, easy to implement, and you earn guaranteed interest.
Unlike crypto or the stock market, your money doesn't fluctuate with the market. It's easy because you don't have to time to stress about what's happening on Wall Street.
You didn't become a successful business woman by following the crowd. Click the button below to get free information on how to build your wealth.
Day Lark Wealth helps women achieve their financial goals and secure their financial future.
This information is for educational purposes only and should not be considered specific tax, legal, investment or planning advice.
https://www.nerdwallet.com/article/investing/financial-fees-study-2018
https://www.nasdaq.com/articles/you-couldve-become-a-millionaire-with-just-%241000-invested-in-this-warren-buffett-stock#:~:text=Since%20Apple%20stock%20trades%20at,more%20than%20%241.26%20million%20today!
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