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I studied money for 5 months and I finally found it!
This is one of the safest ways to invest your money.
It’s so safe, I could put all my money in it and it almost has no risk.
If you are scared of investing your money then this video is for you!
Trust me, it will blow your mind.
But first, some background!
I am on a 6-month challenge to study money!
How to invest it and grow it!
I am doing this with my friend Yoni, who is the founder of eToro, the largest social investing platform in the world.
If you want to join us, just go to nas.io/money.
Everything I’m learning is available to you there for free.
Shall we start?
Let’s start!
Alright, back to the challenge!
The reason you don’t invest your money is because you are scared – admit it.
You’re scared to buy a stock and it goes down.
You’re scared to buy crypto and it goes to zero.
I get it!
I’m scared too!
The stock markets can go up and down.
It’s called volatility
Sometimes, all the markets, all the stocks go down and some people are afraid of that uncertainty.
That’s why you have to learn about government bonds.
They’re incredible – an incredible way to start.
Let me explain.
Imagine if you have $1,000.
Instead of buying stocks or crypto, you take that $1,000 and give it to the government as a loan.
You can buy a government bond or bond ETF.
The government will take your money and then give you around 4.5% interest on that money.
What does that mean?
It means that $1,000 you invested, you’re gonna get $45 every year from that $1,000.
And when the loan is up, when the loan finished, the government returns to you the entire $1,000 back.
This is called fixed income, and it’s probably one of the safest ways to invest your money.
Why? Because the US government is mostly safe.
They most likely will not go bankrupt tomorrow or in the next year.
And if the US government goes bankrupt, then we have much bigger problems.
In the case of US government bonds or treasury, it is considered the safest investment there is because you’re basically lending money to the US government.
And the US has never missed a payment!
Bonds are a great way to invest your money safely because you can predict how much money you’ll get back.
That’s why it’s called fixed income.
Now, check this, this is a real example.
If you invest $100,000 in government bonds, with a 5% interest, you know what that means?
That means you’ll get $5,000 every year on that bond.
And when the bond is up, when you get back your loan, you’ll get that $100,000 back.
So you made that $5,000 almost risk-free.
Now that becomes your “income”.
It’s almost like a salary that you can predict every year!
This investment is kinda simple!
That’s why I invested millions of dollars of my personal money into bonds.
Those millions of dollars?
I don’t want them to double.
I don’t want them to grow fast.
I want them to grow slow and steady and safe, because that’s my “retirement money” almost.
The stock markets are exciting and volatile.
Crypto markets are even crazier!
But as my grandfather who used to be a Swiss banker says, the bond markets offers a reliable and consistent return to his asset management clients.
Boring but reliable.
And guess what?
It’s not just governments that do it, it’s also companies.
Take Coca-Cola for example.
Coca-Cola has a bond structure of 4.35% for a 3-year bond.
This means, Coca-Cola will take your money and invest it in factories to grow them.
And then, after 3 years, they will give you back your money plus 4.35% every year.
Now that’s incredible and predictable.
If you are still scared of bonds, then check this out.
This is really cool!
Every bond has a grade, just like high school.
A grade from A to D.
“A” means the bond has very little risk, mostly safe.
And “D”, it means it’s very risky, so be careful!
So if you buy a AAA bond, then that’s mostly safe.
If you buy a D bond, then…
You may lose your money!
And the US government, for example, has a rating of AA+, which basically means you can trust it as a safe investment.
So guys, this is the big idea:
If you want an income – additional income – every year, then you should think about investing in bonds, because that is fixed income.
Now you can have 2 incomes: your salary at your job and a fixed income from the bonds.
The bond market is actually the largest market in the world.
$140 trillion, bigger than all the stock markets combined, and that’s because that’s where governments and the largest corporations in the world both raise debt as well as invest their treasury.
Now remember, I say there is no risk, but of course everything has a risk, so be careful.
Number 1: if the government collapses, you lose money.
If the inflation is too high, you could lose money.
If you sell the bond too early, you could lose money.
There are ways in which you could lose money, but that’s the risk.
However, if you are just buying a 10-year US government bond with, for example, 4% return, and you wait for 10 years, you’ll get back 4% every year for 10 years and you’ll get your money back.
And this is the big idea guys: investing money should not be scary.
It’s not scary to make your money work for you.
You don’t have to buy crypto or stocks or whatever.
You could invest your money in a safe and measured manner.
You just have to start thinking about money.
See you next month for 1 last video about money!