One of the first moves, as a young investor, is to let The Golden Rule of Investing sink into the inner reaches of the brain. There is no substitute for this rule. None! Pay particular attention to the word -EARLY.
The second rule of investing, particularly for beginners, is to keep it simple. Assume one is able to save $50 or $100 per month. Further, assume one has at least 30 years until retirement. A very simple model is to dollar cost average or invest that $100 each month in the U.S. Equities market. I recommend using VTI or Vanguard’s total U.S. stock market Exchange Traded Fund (ETF). Buy as many shares as possible on the last business day of the month and keep this up month after month. Don’t deviate from the plan.
This is about as simple as it gets. If the market drops, try to squeeze out a few extra dollars and purchase more shares. Investing regularly in an index ETF is the ultimate in passive investing.
Model #2 is not much more complicated, but it does involve using the Kipling spreadsheet. Assume one now has a second $50 or $100 to invest each month. Don’t neglect plan #1. As for plan or Model #2, employ the Dual Momentum (DM) model as it provides downside protection. An example of this model was recent posted. Check out the Galileo.
For more information as to how the Dual Momentum model works, go to this link and look over titles that include the words, Dual Momentum. More information on the workings and examples of the DM model can be found in the right-hand sidebar. Find Categories and then use the pull-down menu to locate Dual Momentum. The oldest DM blogs will come up first. If looking for the latest blogs on this subject, use the search engine and type in Dual Momentum. This blog post is of interest to Dual Momentum investors.
There you have two simple investing models to use to build a retirement fund. As you gain experience, branch into other investing models explained on this blog. But continue to stick with the first model of investing monthly in VTI, come thick or thin.