Stop making these 7 money mistakes!

10 Steps to Super Simple Investing

  February 14, 2024  |    #Make Money

Simple investing for the not-so-simple

Life’s like a good grilled cheese—sometimes it’s better when it’s a bit crispy, but simplicity reigns supreme when it comes to investing, like finding out your favorite Netflix series just got renewed for another season.

Simple investing help you join the Investing Class ASAP

After years of navigating the murky waters of finance, deciphering economic trends, and reminiscing about the glory days of Destiny’s Child (yes, there were four original members, and no, we won’t hear otherwise), we’ve stumbled upon a revelation: just like there are four fundamental food groups (pizza, tacos, sushi, and everything else), there are four financial classes.

Think of it like assembling a boy band—each class has its own vibe, its own signature move, and its own die-hard fans. Some folks dabble in a few classes, like trying out different hairstyles in high school, while others commit to one like it’s their favorite flavor of ice cream.

But fear not, financial voyager! Just as you can upgrade from a flip phone to a smartphone (finally, emojis!), you can level up your financial game. Without further ado, let’s meet the cast of characters in this financial sitcom we call life: the Savers, the Spenders, the Debtors, and the Investors. So, grab your popcorn and let’s embark on the journey to join the illustrious Investing Class—where the grass is greener and the returns are sweeter.

The Four Financial Classes

1. The Leveraging Class

The Leveraging Class—aka the magicians of money, turning plastic into purchases faster than you can say “Abracadabra!” These folks are like the Stanley Burrells of finance, strutting their stuff with their credit cards like their own entourage.

Picture this: they’re the ones who never met a sale they didn’t swipe for, the masters of the “buy now, worry later” philosophy. They might have a credit score that makes banks swoon, but they’re also shelling out more interest than a Hollywood gossip magazine.

You’ll spot them at the mall, credit cards gleaming in the fluorescent lights, as they transform retail therapy into a high-stakes game of financial roulette. And hey, if keeping up with the Joneses means going into debt, sign them up—they’ll be dining with the Joneses in no time (albeit at a table financed by Visa).

2. The Spending Class

The Spending Class—a group who treats every paycheck like it’s burning a hole in their pocket, spending it faster than you can say “cha-ching!” These folks live by the motto “Mo’ Money, Mo’ Shopping Bags.”

They’re the ones who make it rain cash at every opportunity, leaving their wallets as empty as a politician’s promises. Savings? Ha! They’re only saving a spot in line at the next big sale.

Sure, they might occasionally dabble in the world of credit cards, but their credit score resembles a rollercoaster ride—full of ups and downs, twists and turns, but ultimately leading nowhere good.

You won’t find them with a long list of possessions or a shiny credit history like the Joneses. Instead, they’re more like Madonna without her Vogue moves—struggling to keep up appearances while secretly wishing they were elsewhere.

So, next time you’re at the mall and see someone tossing around Benjamin Franklins like they’re Monopoly money, you can bet your bottom dollar they’re a card-carrying member of the Spending Class.

3. The Saving Class

The Saving Class—the financial ninjas who make budgeting look as easy as pie (and who wouldn’t mind a slice of that pie for themselves). These are the folks who could squeeze a nickel so tight it’ll cry out for mercy.

They’re the masters of thriftiness, the Jedi knights of frugality, carefully calculating every expense like it’s a math problem on steroids. But when it comes to investing in the stock market, well, let’s say they’re more cautious than a cat in a room full of rocking chairs.

Blame it on the rollercoaster of Wall Street or the allure of stuffing cash under the mattress—it’s hard to say no to the safety net of savings when the stock market’s track record resembles a teenager’s mood swings.

In today’s world of rock-bottom interest rates, this class is as rare as a unicorn sighting at the local zoo. But fear not, you’ll spot them at the mall, not splurging on designer labels, but casually sipping wine and indulging in the ultimate pastime: online window shopping. Because who needs retail therapy when you’ve got a scroll hole on Amazon to fall into?

4. The Investing Class

The Investing Class is the financial wizards who treat the stock market like their own personal playground, channeling the spirit of the CEO of hip-hop himself. These are the folks who understand that money talks, but investments sing, and they’ve got front-row seats to the concert.

While others lament the pitiful interest rates of savings accounts like it’s the latest tragedy on Netflix, the Investing Class is too busy making their money work overtime, clocking in like it’s getting paid by the hour.

They’ve cracked the code of credit, turning it from a necessary evil into a powerful tool, with credit scores so shiny that they practically blind the banks. And while they may have a bit of debt hanging around, their net worth is as positive as a cat in a room full of catnip.

Unlike the Joneses, who are one step away from taking out a mortgage to keep up appearances, the Investing Class knows the real secret to wealth isn’t in flashy purchases but in savvy investments that keep the cash flowing.

They’re the landlords of the mall, thanks to their savvy REIT investments in their 401(k), raking in returns that would make Scrooge McDuck jealous.

So, where do you fit in? If your answer is “Sign me up for the Investing Class, pronto!” then buckle up, because I’ve got 10 super-simple steps to help you join the ranks of the financial elite.

10 steps to super simple investing

1. Open a simple investing account online

Opening an Individual Retirement Account (IRA) or brokerage account online is as easy as pie—literally! We’ve mastered the art of multitasking so well that we’ve set up accounts during lunch breaks, all while shoveling food into our mouths faster than a competitive eater at a hot dog eating contest.

All you need is your trusty Social Security Number (because let’s face it, even the stock market wants to know who you are), your home address (because investing doesn’t discriminate based on geography), and your banking information. And voila! You’re on your way to becoming a financial guru.

Plus, with many online firms offering accounts with no minimum balance requirements and zero fees (just be sure to read that fine print like it’s the latest gossip column), there’s really no excuse not to jump on the investing bandwagon.

So, grab your sandwich in one hand, your laptop in the other, and let’s make some money moves—because why wait when you can start investing faster than you can say “stock market sensation”?

2. Set up direct deposits into your online account

Now that you’ve successfully navigated the digital realm and opened your online accounts (cue the virtual confetti!), it’s time to give them some financial CPR—Cash, Please, Right?

If your employer still thinks fax machines are cutting-edge technology, fear not! You can drag them kicking and screaming into the 21st century by setting up direct deposit. It’s like magic, but with money.

And if your workplace is more “Dunder Mifflin” than “Google Headquarters,” no worries! You can still embrace the wonders of modern technology by setting up electronic funds transfer (EFT) or automatic clearing house (ACH) transfers. Just make sure you have your bank’s routing and account numbers handy—it’s like knowing the secret password to the financial kingdom.

Best part? You can set these transfers to be automatic and recurring, like your morning alarm snooze. They’re the Taylor Swift of financial transactions—swift, safe, and always on beat. So go ahead, pay yourself first, and let your money dance its way into those investment accounts like it’s auditioning for a Broadway musical!

3. Buy low-cost Exchange Traded Funds (ETFs) for simple investing

Ah, the world of investing—where acronyms abound, and confusion reigns supreme! But fear not, my financially fearless friend, for I’m here to decode the alphabet soup.

When it comes to ETFs (not to be confused with EFTs because mixing those up would be like confusing your Tinder profile with your LinkedIn resume), think of them as the Costco-sized bags of stocks or bonds—you get more bang for your buck without breaking the bank. Plus, they trade on stock exchanges, making them as accessible as your favorite late-night snack.

Now, to keep things cheap and cheerful, opt for index ETFs. These bad boys track established market indices like the S&P 500 or the Russell 2000, giving you a piece of the action without breaking a sweat (or your budget).

And hey, if you’re all about supporting the LGBTQ+ community or championing women’s rights, there are ETFs like PRID and SHE that are as inclusive as a family reunion at Aunt Sally’s. So go ahead and invest in your future while making the world a better place—one ETF at a time!

4. Diversify your investments

The age-old wisdom of not putting all your financial eggs in one basket is wise . . . because, let’s face it, even the most sturdy baskets have been known to sprout leaks.

So, consider spreading your moolah across various asset classes to keep your investment portfolio as diverse as a buffet spread at a wedding (minus the weird jello mold). Think large-cap, small-cap, international, fixed-income index ETFs and a sprinkle of cash for good measure. It’s like creating your own financial potluck—everybody brings something to the table.

But hey, if you’re all about simplicity (who isn’t?), the asset allocation ETF is your knight in shining armor. It’s like a Swiss army knife of investments, with a little something for every type of investor. Whether you’re feeling adventurous or prefer to play it safe, there’s an asset allocation ETF with your name on it. So go ahead and simplify your life and your investments—all while keeping your financial future as stress-free as a hammock nap on a sunny day.

5. Start an employer-sponsored retirement account

Here’s the alphabet soup of retirement savings—401(k)s, 403(b)s, 457s, and all their distant cousins. It’s like deciphering a secret code, except the only secret is how much you can squirrel away before Uncle Sam comes knocking on your door.

But fear not, my financially savvy friend, for these accounts are like the ultimate cheat code in the game of life. First, if your employer offers a match, that’s like winning the financial lottery—free money, baby! It’s like finding a twenty in your pocket, only better.

Plus, investing pre-tax dollars is like giving Uncle Sam the ol’ slip-and-slide—he gets less of your hard-earned cash to play with. And let’s not forget about the magic of tax-deferred growth—it’s like planting a money tree and watching it grow without Uncle Sam taking a bite until you’re ready to cash in.

But here’s the kicker: don’t let your retirement account become a couch potato. Too many folks park their money in cash, watching it grow at a snail’s pace with today’s interest rates (or lack thereof). Instead, get those dollars working for you like they’re training for a marathon.

Sure, the investment options might be about as exciting as watching paint dry, and the expenses might sting like a paper cut. Still, with a little research and a dash of moxie, you can whip that retirement account into shape faster than you can say, “Early retirement, here I come!”

6. Start a Health Savings Account (HSA)

Welcome to the magical land of Health Savings Accounts (HSAs)—where the deductible may be high, but the rewards are higher than a giraffe’s neck.

Think of it like a secret treasure chest buried deep within your healthcare plan, waiting to be plundered (legally, of course). Contributions slip through Uncle Sam’s grubby fingers like a greased pig at a county fair, reducing your taxable income faster than you can say “fiscal responsibility.”

But wait, there’s more! Not only do your contributions grow tax-deferred, but withdrawals are as tax-free as finding a forgotten $20 bill in your pocket—except this time, it’s legally sanctioned.

And here’s the cherry on top: most employers are like benevolent wizards, sprinkling their own contributions into your HSA like fairy dust. It’s like getting a bonus every time you see the doctor—more free money than you can shake a stethoscope!

So go ahead, embrace the HSA life—because when it comes to healthcare savings, it’s like hitting the jackpot without ever setting foot in a casino.

7. Pick automatic annual contribution increases

The wonders of modern technology are wonderful—where even your healthcare savings account is smarter than your average houseplant.

Picture this: your employer, like a financial fairy godmother, waves their magic wand, and voilà—automatic annual contribution increases appear like clockwork. It’s like having a personal financial assistant but without the awkward small talk.

These pre-determined increases keep your contributions growing faster than a Chia Pet on steroids, ensuring they keep pace with your wage increases and warding off budget creep like a superhero in a spandex suit.

So go ahead, sit back, and let your HSA do the heavy lifting—because when it comes to saving for healthcare, why stress when you can let technology do the work for you?

8. Open an emergency savings account

Ah, the financial equivalent of hiding your emergency fund under the mattress—except with less risk of getting eaten by moths.

Step one: Open a basic account at a bank or credit union, but leave the bells and whistles at the door. No debit card, no credit card, and definitely no fancy bill pay or EFT capabilities. Think of it as the financial equivalent of a hermit crab shell—simple, unassuming, and unlikely to attract attention.

Next, set up recurring direct deposits or one-way EFTs into this account. It’s like feeding a piggy bank but without the temptation to break it open for late-night pizza runs.

Continue this until you’ve squirreled away three to six months’ living expenses. Think of it as your financial safety net—a cozy hammock to catch you if life decides to throw a curveball (or a curveball-sized bill) your way.

So go ahead, embrace the bare bones approach to banking—because when it comes to emergency funds, sometimes less is more.

9. Open a custodial and/or college savings account

The wild world of custodial accounts is where grown-ups play the role of financial superheroes for the minors in their lives. It’s like being a money-savvy Batman, but instead of fighting crime, you’re battling financial illiteracy (cue the dramatic cape swish).

First up, we’ve got the UGMA/UTMA accounts—custodial accounts where you, the designated adult, get to play financial fairy godparent, investing money on behalf of the lucky minor beneficiary. It’s like giving them a head start on the road to financial independence—because, let’s face it, college isn’t the only thing worth saving for these days.

And here’s the kicker: the growth in these accounts is either tax-free or taxed at the minor’s marginal income tax rate. It’s like finding out your favorite dessert is guilt-free—sweet!

But wait, there’s more! Let’s not forget about our other custodial and college savings account options:

  • 529 Plans—state-sponsored education savings plans where you can squirrel away up to a whopping $310,000 in some states. It’s like giving your future Einstein the keys to the academic kingdom (and maybe a few textbooks).
  • Gift accounts—a simple yet effective way to stash cash for your loved ones without running afoul of the taxman. Just remember to stay under those annual gifting limits—because nobody wants a surprise visit from the IRS.

So there you have it, folks—the superhero’s guide to custodial and college savings accounts. Because when it comes to securing a brighter financial future for the next generation, why settle for anything less than heroic?

10. Assign beneficiaries to all accounts

Let’s diver into the thrilling (after)world of beneficiaries because even in the afterlife, paperwork reigns supreme.

Step one: Add beneficiaries to all your accounts, like sprinkling confetti on a birthday cake. But don’t stop there—throw in some contingent beneficiaries for good measure, just in case your first choice decides to skip town (or the afterlife).

And here’s the kicker: beneficiary designations are like the VIP pass to your financial party—they supersede wills, trusts, and even those questionable IOUs you wrote on cocktail napkins. It’s like being the bouncer at the club of life, making sure your money goes exactly where you want it to.

But beware of the wrath of the financial gods—if you neglect to assign beneficiaries, your money could end up in the hands of your next of kin. And let’s face it, leaving your hard-earned cash to your long-lost cousin twice removed is scarier than a haunted house on Halloween night.

So go ahead, update those beneficiaries annually—because when it comes to the game of life, it’s better to be safe than sorry.

Investment types for super-simple investing

Now, buckle up, because we’re about to dive into the wild and wacky world of investment options.

First up, we’ve got stocks—aka little slices of ownership in companies. It’s like playing Monopoly but with real money and fewer arguments over who gets to be the banker.

Next on the list, we’ve got bonds—basically IOUs from governments or corporations. It’s like being the lending library of the financial world, except instead of books, you’re loaning out your hard-earned cash for a tidy profit.

And let’s not forget about mutual funds—like the Swiss Army knife of investments, they’re a diverse mix of stocks, bonds, and other goodies, all wrapped up in one neat package. It’s like ordering the sampler platter at a fancy restaurant—you get a taste of everything without committing to one dish.

Last but not least, we’ve got the ever-mysterious world of ETFs—exchange-traded funds that trade on the stock exchange like stocks but give you the diversification of a mutual fund. It’s like getting the best of both worlds—like having your cake and eating it, too (with a side of extra frosting, of course).

So there you have it, folks—a crash course in the vast and wonderful world of investments. Because when it comes to making your money work for you, the sky’s the limit—just make sure you’ve got a parachute (and maybe a safety net or two) on standby.

1. Cash and cash equivalents for simple investing

Good ol’ cash—the kind of stuff you can use to buy everything from a cup of coffee to a giant inflatable unicorn (because who wouldn’t want one of those?).

But wait, there’s more! Cash equivalents are like cash’s fancy cousins—U.S. Treasury Bills, bank CDs, and Money Market Mutual Funds. They’re short-term investments as stable as a cat on a windowsill and as liquid as a slushie on a hot summer day.

Now, let’s not get ahead of ourselves—these babies might not be guaranteed never to lose value, but they’re about as close to financial rock stars as you can get. And hey, even though they won’t make you rich overnight, they’re like the reliable sidekick in your investment portfolio—always there when you need them, never causing any drama.

So go ahead, sprinkle some cash and cash equivalents into your investment mix—because when it comes to financial stability, a little liquidity can go a long way.

2. Super simple investing with bonds

Bonds—the financial equivalent of lending a hand to your favorite government agency or corporation. Think of it like being the friendly neighborhood banker, except instead of giving out toaster ovens as gifts, you’re handing out chunks of money with a fancy IOU attached.

So here’s the scoop: you, the savvy investor, lend money to the issuer—whether it’s Uncle Sam or your favorite Fortune 500 company. In return, they hand you a shiny new bond with a promise to pay back the principal (the amount you lent) plus interest (aka the icing on the financial cake) when the bond matures or hits its due date.

Now, let’s talk flavors. Government bonds are like the vanilla ice cream of the bond world—safe, reliable, and backed by the “full faith and credit of the U.S. government” (whatever that means). And just like ice cream, they come in three delicious varieties: bills, notes, and bonds, depending on how long you want to wait to cash in.

But wait, there’s more! Municipal bonds are like the caramel swirl to government bonds’ vanilla—slightly riskier, but still a tasty treat for your investment portfolio. And let’s not forget about corporate bonds—the chocolate fudge brownie of the bunch. Sure, they’re riskier than government bonds, but with great risk comes great reward (and maybe a few heart palpitations).

So why invest in bonds, you ask? Well, they’re like the middle child of investments—less risky than stocks but with more flavor than cash and cash equivalents. Just be careful not to play it too safe, or you might find yourself trapped in the financial equivalent of a flavorless tofu burger.

3. Investing in stocks

Let’s now take a wild ride through the ups and downs of owning a tiny piece of your favorite (or not-so-favorite) companies.

First off, let’s talk dividends—aka the sweet, sweet cash bonuses that companies hand out to their loyal shareholders. It’s like getting paid to be a part-time company owner—except instead of a corner office and a fancy title, you get a check in the mail (or a direct deposit, if you’re fancy).

But let’s not forget about the show’s real star: the company’s performance. When your company is killing it in the marketplace, it’s like riding a unicorn through a field of rainbows—your stock is soaring, your dividends are flowing, and life is good.

But when things go south—well, let’s say it’s more like riding a donkey through rush-hour traffic. Companies like Radio Shack or Enron might ring a bell—when they crash and burn, your stock goes up in flames faster than a marshmallow at a bonfire.

Now, onto the main event: common stocks and preferred stocks. Common stocks are like the rockstars of the stock market—they come with voting rights, dividend potential, and the chance for big-time growth. It’s like being front-row at a concert, with all the perks and none of the groupies (unless you count your fellow investors).

Preferred stocks, on the other hand, are like the VIP lounge—no voting rights but guaranteed access to those sweet, sweet dividends. It’s like having your butler—predictable, reliable, and always there when you need them.

So whether you’re in it for the thrill of the ride or just looking to cash in on some sweet dividends, there’s a stock out there with your name on it. Just remember to hold on tight and enjoy the rollercoaster—because when it comes to stocks, the only thing guaranteed is a wild ride.

4. Super simple investing with mutual funds

The financial equivalent of a buffet dinner, with a little something for everyone, a mutual fund. Picture it: a smorgasbord of stocks, bonds, treasuries, and cash, all mixed together in a delicious stew of investment goodness.

But here’s the kicker: managing a mutual fund is like running a miniature circus. You’ve got the mutual fund manager cracking the whip, the support staff juggling paperwork, and the marketing team trying to sell tickets to the greatest show on earth. And let’s not forget about research and development—because even in the world of finance, innovation is key (or so they tell me).

Now, onto the not-so-fun part: the annual operating expense. It’s like the cover charge at a fancy nightclub—except instead of getting access to a VIP lounge, you’re paying for the privilege of having someone else manage your money. And let’s be real, those fees can add up faster than a toddler in a candy store, especially when dealing with retirement accounts like 401(k)s and 403(b)s.

But fear not, dear investor, for there’s a silver lining to this financial cloud. Enter index funds—the unsung heroes of the mutual fund world. These bad boys track standard market indices like the S&P 500 or the Russell 2000, giving you all the benefits of mutual fund investing without the hefty price tag.

So go ahead, dip your toe into the mutual fund waters—but remember to keep an eye on those expenses because every penny counts when it comes to investing.

5. Pick Exchange Traded Funds (ETFs)

ETFs are the chameleons of the investment world, blending the best of both stocks and mutual funds into one glorious financial creature.

Picture it: a magical basket of investments pooled together like a potluck dinner at your weird cousin’s house. It’s like getting a little taste of everything without committing to one dish—or, in this case, one stock or bond.

But here’s where it gets interesting: unlike their mutual fund cousins, ETFs are like the Energizer Bunny—they keep going and going, trading throughout the day like stocks on a caffeine high. It’s like playing a game of financial ping pong, with prices bouncing around in real-time faster than you can say, “Buy low, sell high.”

And let’s not forget about everyone’s favorite part: index funds. Just like in mutual fund land, these bad boys track standard market indices like the S&P 500 or the Russell 2000, giving you all the benefits of diversification without the headache of picking individual stocks.

But wait, there’s more! The rewards of owning ETFs are like finding a pot of gold at the end of the rainbow—tax advantages, diversification, and lower fees, oh my! It’s like hitting the investment jackpot without having to break a sweat.

But beware the dark side—some ETFs are like that quirky artisanal cheese shop downtown, lacking liquidity and making it harder than a Rubik’s Cube to get in or out when you need to. So choose wisely, my friend, and may the investment odds be ever in your favor.

6. Real estate investment trusts (REITs)

REITs are the secret sauce of the Investing Class, turning everyday folks into real estate moguls faster than you can say “open sesame.”

Think of it like this: while you’re busy fixing leaky faucets and dodging tenants with questionable taste in interior decor, your friends in the Investing Class are lounging poolside, sipping mai tais, and raking in the rental income without lifting a finger.

REITs are like the real estate version of a well-oiled machine—companies that own, operate, and finance income-generating properties, from swanky skyscrapers to cozy apartment complexes. It’s like having your own personal property empire, minus the headache of dealing with unruly tenants or unexpected plumbing disasters.

So whether you’re dreaming of owning a piece of the Big Apple or just looking to diversify your investment portfolio, REITs are like the golden ticket to real estate riches. And let’s be real, who wouldn’t want to own a piece of the mall without dealing with the headache of managing it yourself?

So go ahead, join the Investing Class, and stake your claim in the world of real estate—because when it comes to building wealth, why get your hands dirty when you can let your money do the heavy lifting?

6 critical investing rules to know about

Navigating the investment landscape can feel like tiptoeing through a minefield—every step fraught with the potential for disaster. But fear not, brave investor, for I bring tidings of wisdom: the six sacred commandments of investing, designed to steer you clear of financial peril and lead you toward the promised land of prosperity. So heed these words well, and let us embark on this epic journey together.

1. Front running will put you in investor jail

Front running is the oldest trick in the book. One investor swoops in like a seagull stealing french fries, leaving the rest of the flock squawking in frustration.

Picture it: your friendly neighborhood advisor or broker, playing the role of financial Robin Hood, except instead of stealing from the rich to give to the poor, they’re stealing from their own clients to line their pockets.

It’s like trying to play poker with someone who can see your cards—a classic case of unfair advantage that leaves you feeling like you’ve been duped by a used car salesman.

So beware, dear investor, for front running is like a wolf in sheep’s clothing—sneaky, underhanded, and always looking for its next victim. Stay vigilant, and may the odds be ever in your favor.

2. Shadowing is shady

Then, there’s shadowing—the financial equivalent of being the kid who copies the cool kid’s homework, hoping to snag a passing grade without doing any of the work.

It’s like being part of a giant game of follow the leader, where one investor makes a move, and the rest of the pack scrambles to keep up. It’s like trying to play hide-and-seek with a group of ninjas—no matter how stealthy you think you are, someone’s always one step ahead.

But hey, there’s a silver lining to this shadowy behavior—sometimes, riding the coattails of those in the know can lead to unexpected riches. It’s like stumbling upon a treasure map while digging for buried treasure—suddenly, you’re sailing the high seas in search of gold with a crew of savvy investors by your side.

So whether you’re a trendsetter or a trend follower, just remember to keep your wits about you and your eyes on the prize. Because when it comes to investing, it’s not about who you know—it’s about who you can piggyback on.

3. Painting the tape is out of line

Painting the tape is the Wall Street version of putting lipstick on a pig, making something look way fancier than it actually is.

Picture it: a group of traders huddled together like mischievous schoolkids, conspiring to pump up the volume of a stock to make it seem like the hottest thing since sliced bread. It’s like throwing a party and hiring a bunch of actors to pretend they’re having the time of their lives—except instead of dancing and champagne, it’s all smoke and mirrors.

But here’s the kicker: once they’ve got everyone drooling over their shiny new stock, they swoop in like financial superheroes, buying low and selling high faster than you can say “market manipulation.” It’s like being the puppet master pulling the strings, with everyone else dancing to your tune.

So beware, dear investor, for painting the tape is like a magic trick gone wrong—flashy, deceptive, and leaving you wondering how you ended up with a rabbit instead of a bag of gold. Stay skeptical, and may your investments always be as solid as a rock.

4. Freeride is not-so-free

The free ride is a classic case of trying to have your cake and eat it, but in this scenario, the cake is stock, and the eater is selling it before you even pay for it.

Imagine it: a trader with the financial finesse of a cat burglar, slipping in and out of the stock market like a ninja in the night. It’s like buying a fancy sports car with Monopoly money and selling it for real cash before anyone catches on.

Here’s how it goes: you buy some stocks on a Monday, thinking you’re a big-shot investor. But lo and behold, it takes three whole days for the transaction to settle—meaning you’re sitting there with stocks in hand but no cash to show for it. So what’s a sneaky trader to do? Sell those stocks on Tuesday, of course, before anyone realizes you’re playing fast and loose with the rules.

But beware, dear trader, for the free ride is like trying to juggle flaming torches while riding a unicycle—sure, it might look impressive at first, but sooner or later, you’re bound to crash and burn. So play by the rules, and may your investments always be paid for in cold, hard cash.

5. Margin maintenance call

Then there’s the margin call—a financial thriller that’s not only a trade violation but also the stuff of Hollywood legend, starring none other than the one and only Wall Street heartthrob, Mr. Leonardo DiCaprio himself.

But let’s break it down, shall we? Picture it: you’re a trader riding high on the stock market wave when disaster strikes suddenly. Your marginable securities drop faster than a lead balloon, and before you know it, you’re over-leveraged faster than you can say, “Sell, sell, sell!”

Now, here’s where the plot thickens: your friendly neighborhood broker/dealer, armed with a complex formula straight out of a spy thriller, swoops in to deliver the dreaded margin maintenance call. It’s like being handed a ticking time bomb with a note that says, “Pay up or else.”

But fear not, dear trader, for you have options. You can either cough up the cash faster than a cheetah on espresso or sell off a chunk of your marginable securities quicker than you can say, “I’ll take a loss, please.”

But beware the consequences, for failing to heed the call of the margin can have ripple effects faster than a pebble in a pond, sending shockwaves through the market and economy faster than you can say “cut to black.”

So remember, dear trader, when it comes to margin calls, it’s not just about saving your own skin—it’s about saving the financial world as we know it. So grab your popcorn and hold on tight because this is one ride you won’t want to miss.

6. Fed margin call

Finally, there’s the Fed Margin Call—the financial equivalent of getting slapped with a wet fish right as you’re about to dive into the stock market pool.

Picture it: you’re a margin trader, feeling all fancy with your borrowed cash and your dreams of striking it rich. But alas, in your eagerness to snag that sweet, sweet marginable stock, you’ve bitten off more than you can chew faster than a kid at a candy store.

So there you are, sitting pretty with $3,000 cash in your account, when suddenly, you find yourself on the hook for a whopping $5,000 to cover your margin stock purchase. It’s like ordering a five-course meal with only enough cash for a Happy Meal—oops, did someone say overspend?

Now, here’s where the plot twist comes in: your friendly neighborhood broker/dealer, armed with the power of the Federal Margin Call, swoops in like a financial superhero to deliver the news. It’s like being served a reality check with a side of humble pie—ouch.

But fear not, dear trader, for you have options. You can either pony up the cash faster than a cowboy at a rodeo or sell off a chunk of your marginable securities quicker than you can say, “I’ll take a loss, please.”

But beware the wrath of the trader scorned, for having your securities sold out from under you is like having your cake stolen by the office prankster—sure, it’s technically legal, but it’s still a major bummer.

So remember dear trader, when it comes to margin calls, it’s not just about playing with borrowed cash—it’s about playing with fire. So tread carefully, and may your investments always be as solid as a rock.

An Investing Class conclusion

And there you have it, fellow members of the Investing Class—the wild and wacky world of investing, where fortunes are made and lost faster than you can say “buy low, sell high.”

From the highs of riding the market wave to the lows of navigating margin calls and Fed Margin slaps, it’s been quite the rollercoaster ride. But fear not, dear reader, for armed with knowledge, wit, and perhaps a pinch of luck, you too can conquer the financial frontier and emerge victorious.

So go forth, my friends, and may your portfolios be as diversified as a buffet spread, your returns as bountiful as a jackpot at the casino, and your laughter as plentiful as a stand-up comedy show on Wall Street.

And remember, when in doubt, just think: What would Warren Buffett do? Probably buy low, sell high, and enjoy a nice cherry Coke while he’s at it.

Happy investing, and may the financial gods smile upon you!

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4 responses to “10 Steps to Super Simple Investing

  1. For some reason I cannot download the investment guide from the page – I’ve tried on my two macs and my PC – is there a trick? Thanks for all! I’m ready to start my investment journey!

    1. Hi there! Sorry for the trouble. Are you getting an error message? If not, the only thing we can think of is if you have a blocker that prevents additional tabs from automatically opening on your desktop. When you click any of the links for the guide, another tab should open for you where you can get the guide. Let me know if that works.

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