Invest now or wait?

Hi,

I’m a student with a few thousand dollars to invest. I won’t need the money for a while, I’m thinking 25 years. I just want to put my money in a safe passive mutual fund and let it sit for a while. If it grows an average of 8% year-over-year it will be worth over 60 thousand dollars by then.

My question is, is it smart of me to start investing today when stocks are expensive, or save up cash and wait for a crash when stocks are cheap, and start investing then?

Here’s my rational,

If a share today is worth $40 and it will grow for a few years even to $60. But then the market will crash and it will drop to $20 a share. I think it makes sense to buy at $20 later rather then now at $40. If that’s true why would anyone invest now, everyone should be saving money, and if it’s not true then why not?

The best time to start investing is always right now. Waiting around to try to time the market will only cause you to have “analysis paralasys” and you’ll likely miss every opportunity.

If you have some time and patience to learn about stocks and investing, definitely take some online courses so you will know what you’re doing in the future. Either way, you can start automated investing for free on Sofi and they will manage your index funds for you with no fees. I would appreciate if you use my link to sign up, which will give each of us a $50 bonus.

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If you want to go the route of stocks then you should consider low-cost Index funds instead of actively managed mutual funds. The small fees and taxes of mutual funds actually eat away a massive amount of your profits, especially over 25 years.

Now you can also try alternative investments like real estate that can give you a much higher return on investment upwards of 20% year over year.

You do not need a lot of money to begin investing in real estate. The Book on Rental Property Investing is an amazing book that shows you an exact plan to go from $10,000 dollars to $1 million dollars in just 7 years.

Oh, and btw you don’t even need any money to invest in real estate. Watch the video below to learn how.

This book shows you how to invest in rental properties and not have to be busy with managing these properties.

Watch this video which explains why this is an amazing way to invest and grow wealth a lot faster than most other investments.

Let me show you the difference between 8% returns vs 20% returns over 20 years. The difference is HUGE!

You invest $5000 over 20 years:

  • 8% interest = $23,305
  • 20% interest = $191,688
  • 25% interest = $433,681

Now you tell me, which one would you rather? Don’t underestimate the power of compounding and the difference a percent more or less can make on your final return.

Check out this compound interest calculator to see the numbers for yourself.