Amazon went public back in 1997, if you have invested just a hundred dollars in amazon
back then, you would have made almost 1.3 million dollars ( $1,291,860). Let's say you
would have been a bit more generous and invested a hundred thousand dollars. Your net worth
would be 129 million dollars. Unfortunately, you missed your opportunity. But you shouldn't
be sad because, in the middle of so many worthless online companies that were launched in the
1990s, it was extremely difficult to predict that Amazon will be one that will cross a
trillion-dollar valuation 20 years later. However, we are now in the middle of another
great opportunity, even if you do not have a hundred thousand dollars, you can make a
difference by investing as little a thousand dollars. So, let's start with the first one.
Pick up 2 to 3 stocks.
I know that many of you would point fingers at me and say that you need much more than
that to earn a reasonable amount out of the stock market.
And I totally agree with you. But I want you to look at it from a different angle.
In the last 12 years, the stock market has only been growing. If you take a look at any
well-established company, you will realize that their stock has been going upward. But
due to the unforeseen pandemic, everything is down.
But we all perfectly know that sooner or later the pandemic is going to be over and life
will get back to normal at least to a certain extend.
Companies like apple and coca-cola and a
few others are so great that the risk they would go broke is shallow because they sell
products that people either need or strongly desire and they are perfect at doing that.
But right now their stocks are sold at a huge discount, like 30 to 40 percent, and if we
are going to a recession, then you can expect a further drop.
So it's a perfect opportunity to double
your thousand dollars or even triple in a very short period of time. Take an example
of Adobe. It was down by 20 percent, but since they create products we all need, the stock
price has almost completely recovered. Whoever invested at that already made a huge return
in just a few months.
Don't choose many companies, two to three would be a perfect choice.
You can of course, bet on some of the riskier companies such as airlines that have suffered
more or automakers but remember, if you are going to take a bigger risk, you should be
willing to lose that money in case if things go wrong.
2. my next choice is Gold
Before you throw at me, your angry comments. - you told us not to invest in Gold in a
previous video! Why are you telling us to invest in Gold now?
Let me make my case. Gold is, of course, not a great investment, and it's quite useless
in many cases. I am not denying the fact that it has some purpose, but so does iron and
many other metals, but it does not produce anything, it just sits in the corner and shines,
it might make you feel good when you look at it, but that's about it.
Gold's most important role throughout history has been preserving wealth. The future is
unpredictable, financial crises, wars, instabilities happen all around the world, but the faith
in Gold never fades away. Yes, of course sometimes it's high, other times its low, but its always
there in some form. In fact, when there was a gold standard, inflation
was literally at zero percent.
But why Gold is a good investment now.
During good times, when the economy is doing fine, companies are growing, the GDP is hitting
records high. So, gold prices do not rise that much, they rise together with the rate
of inflation. Investing in Gold would be a horrible choice when you have an opportunity
to invest in the stock market and double or triple your rate of return.
However, when there are chaos and instability.
People are afraid, their primary concern isn't to make more money even though its a golden
opportunity but not to lose the money they already have. And they would do everything
to preserve it. So when they see that the stock market is doing terrible, often people
move their wealth to Gold because they know that, Gold will always keep its value, that's
why during any instability, gold prices soar. In the last 6 month, since this pandemic has
started, gold prices rose from 1450 USD to 1700, and if the crises keep going, gold prices
will keep rising.
But here is a problem, sooner or later, the crises will be gone, and people's confidence
in the stock market will be back. So more and more people will invest in the stock market
and less and less in Gold, which means that gold prices will fall.
That's why you have to exist the market at the right time before gold prices will
collapse. When is that going to happen? Well, that's your job to figure out.
3. Start a low-cost business
Back in the 1990s, when the internet was getting popular, some of the greatest companies emerged,
Google, eBay, PayPal, and a dozen more. People literally made billions of dollars. Mark Cuban
made an online radio and sold it to Yahoo for over 4 billion dollars. And I believe
right now we have a similar opportunity, maybe not as big as the dot com bubble, but essential
nonetheless. Because suddenly we all have to stay at home,
but businesses can't afford that, they have to find a way to keep making money.
So if you are a developer or passionate about that, right now with as little as a
few hundred dollars or even a thousand, you can build up something simple but helpful.
Maybe an app that will help us to stay connected
while we are stuck at home. Since gyms are closed, and a lot of people would avoid going
to the gym until a vaccine will be available, an app that will help you to more effectively
work out at home would be a good idea. For god's sake, if you actively work out, you
can start recording videos on how to work out at home.
Since I stopped going to the gym, all I
do is google and watch YouTube videos on the best home workouts for chest, biceps, shoulders,
legs. I don't want to lose all my gains due to this virus, and I am sure there are plenty
of other people like me as well.
Or even if you don't have any valuable skills. Spend a few hundred dollars to learn one as
soon as possible. Such as online and social media marketing. Spend another few hundred
dollars to test your knowledge. And confront any business that is stuck in this crisis.
They are desperate to find a way to keep the business running.
Colleges and universities were one of the
first places that were closed down. And they will try to go online as much as possible,
sounds like a perfect opportunity to teach online.
There is literally an endless number of opportunities, do not jump into all of them.
You just have a thousand dollars. Pick up one and go all in.
Of course, there is a chance that it might
not work out, but if you make it happen, returns are incredibly high.
4. next, Cover your high-interest debts
Credit cards are great. I believe everyone should use them responsibly, and I want to
underline responsibly. Because if you wish to be qualified for a mortgage, be trusted
by financial insinuations to get a loan for your business, you need a good credit score.
And to build it, you need to use a credit card.
However, quite often, people blow it up,
and interest rates on credit cards are freaking insane like 15, 20 percent. You must be financially
super irresponsible to pay that much interest. 20 percent on a thousand dollar debt is
200 bucks. Of course, that doesn't apply to all of your
debts. If you have a student loan or a mortgage, it will be wise to pay just enough to keep
it going while investing the rest of the money.
But whatever returns you make on your investments, your credit card interest will outweigh them.
Especially, in the long run, those interests will accumulate much faster due to the effect
of compound interest. That's why getting rid of such debt should
be your first priority.
5. And lastly, Give your old self a gift
This is not the best option, and I wouldn't choose this option personally. Nonetheless,
it might be a good option for some. We have already talked a couple of times about investing
in an index fund, but of course, that one grand doest seem to make a difference. However,
numbers tell us a different story.
The returns on the stock market are different every year. Some years its as high as 10 to
20 percent, other times its as low as 5 percent, barely beating inflation. However, over a
long period, the average rate of return has been 10 percent.
And with compound interest, that 1k dollars
turns into 53,700 USD over 40 years. Of course, 54K is going to worth much less 40 years from
now, but still would be a considerable amount.
If you are afraid of taking risks and you literally don't know what to do with that
thousand bucks. I think it would be better if you keep it in an index fund and use it
when you retire. Who knows how your life will end up when you are 60 or 70 years old. That
53K might be crucial for you. Again, it's not a perfect option, but worth
considering for some.
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Thanks for watching and until next time.