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The Millionaire Dropout: Fire Your Boss. Do What You Love. Reclaim Your Life! by Vince Stanzione

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30

Making Your Money Work Hard by Saving and Investing

I have a financial background and am successful in trading and investing. This book isn't about trading and investing (anyone interested in that area should look at my specific sites). However, I would like to give a basic overview of investing in the stock market without being taken for a ride.

Money makes money, or so the old saying goes. When you build up extra capital, you should make it grow.

Imagine what would happen if your money grew by 10 percent every year, thanks to clever saving and investment. This is a perfectly possible growth rate. If you started with $10,000, over five years your money would look something like this:

Year 1 $11,000
Year 2 $12,100
Year 3 $13,310
Year 4 $14,641
Year 5 $16,105

Of course, over 10 or 20 years, your money will look even better. The best part about simple investing is that it takes very little time.

How can your money earn you 10 percent per year? You don't have to buy or sell stocks or shares. All you have to do is buy low-cost index funds.

The truth is, even most professional investment firms can't beat the stock market average, yet they charge high fees for investing your money.

You can do perfectly well on your own. Here's how:

1. Open a low-cost broker's account, such as http://www.schwab.com or http://www.etrade.com. In the UK, try http://www.tdwater house.co.uk or http://www.hl.co.uk.
2. Buy an index fund that gives you broad exposure to the stock market (so rather than ...

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