How to get rich: start with stocks
What I've learned from my first year in the stock market.
“They don't know about them sleepless nights,
“Them lookin' for a reason nights,
“They say it's six degrees in life,
“Opportunity. Preparation. They meet. It’s nice.” — Nipsey Hussle
I was lucky when I purchased my first stocks one year ago.
It was Sept. 26, 2022, which means I stumbled into the market at the bottom of a brutal year. I had no idea what I was doing. Like I said, I got lucky.
When I look back on it, my first memory of the stock market will be watching our money rapidly increase. It was a pleasant experience to say the least. But more significant than the temporary thrill of making a few quick bucks is the mentality shift my early investing success prompted. It showed me a sensible way to multiply our money. It made the stock market look simple and left me yearning to learn more. It forced me into lifestyle changes that would help fuel my success.
Had it gone the other way, I wouldn’t be investing today. Had it gone the other way, I wouldn’t have launched Money Talks.
I’m glad it didn’t go the other way. I’m glad I got lucky.
I told you in July that before Money Talks became a thing my original idea was to jot down all my thoughts presented here and shove them in a blue accordion folder. Someday, I figured, Parker could rummage through them. But the deeper I plunged into the stock market, the more I understood I’d have too much to handwrite. Meanwhile, only one person would benefit — someday, maybe.
The shift to a blog, newsletter and podcast just made sense. I could use my media training and lifelong love of writing to leave an impact in a way I haven’t. There also were so many additional lessons I began learning about personal finance that I knew I needed to teach Parker. Now she’ll always have my words as a guide if she needs them.
So what have I learned in my first year of stock investing?
My journey is just beginning. But I have great respect for my first year and all that I accomplished. Most of all, investing has boosted my discipline. It’s helped organize my life in ways I previously only admired in others. My mindset and approach to health and wealth have evolved, and I feel I’m being prepared for a higher place.
I paid a cost to get here. I’m still paying it through unrelenting discipline, education and sacrifice. But the first year of my transformation, the first in my five-year plan to get rich, is complete.
The transition is much smoother now, but the early days were brutal. I logged insanely hectic hours. I woke up early and stayed up late. Me and 4 a.m. became fast friends. By 7:45, I was back up, wiping sleep out of my eyes to prepare to watch the ticker again.
I cut off all radio and television programming that didn’t help me progress. I stopped binge-watching sports. I gave up dating. I dialed back drinking, eating out and hanging out. I replaced my time wisely. I devoured personal finance podcasts and YouTube videos, dug into articles, books and documentaries and followed social media accounts that made me smarter.
People and channels I had never heard of became invaluable resources for how to be a savvy stock investor: Kenan Grace. Chris Sain. The Wallstreet Trapper. Trader TV Live. And others on YouTube and Twitter.
The process stretched me beyond basketball, the comfort zone that had made me too content throughout my career. I didn’t do it because I had to. I did it because I wanted to. Because in the blink of an eye, I saw a better way forward for my family. It felt like learning a new — highly profitable — language and being unable to get enough.
I experienced some exhilarating highs and excruciating lows. But they were needed. They taught me to keep my emotions in check. They helped me learn how to properly ride the roller coaster of stocks, from green to red and back.
I’ve messed around with different methods and found that long-term investing, often described as buy and hold, best suits me. I learned that less is more and that I can use index-fund investing as the primary vehicle to grow my money. I also learned to take advantage of dividend-paying companies to generate additional passive income.
I’ve dabbled in swing trading, or buying stocks and holding the positions for anywhere between a day and several months before ideally turning a profit. I’m also exploring day trading and options trading, or what I like to think of as fast money. I’m committed to learning options to secure an additional source of income. I plan on it being a prominent component in my wealth-building journey. But I’ve been extremely cautious with the method to this point to make sure I don’t lose my shirt.
I’ve learned to be patient but decisive. I’ve learned to keep enough buying power to be in position when the right time comes but to not buy every dip or, as Trap says, you’re going to run out of chip. I’ve learned that time in the market is better than timing the market.
And I have a lot more to learn. But when a $20,000 windfall came my way last year, I knew just what to do. I got lucky on the timing. But I believe my opportunity collided with my preparation.
It made my first year in the stock market really nice.