Title: Rebel Finance School 2026 — Week 1 Monday Transcript
Session: Why Index Funds Win: Lower Fees, Less Stress and Smarter Investing | RFS 2026 Week 7
YouTube Link: https://www.youtube.com/watch?v=_8q-6mH2R-g
Course: Rebel Finance School 2026
Creators: Alan Donegan and Katie Donegan, Rebel Donegans
Canonical page: https://rebeldonegans.com/finance/rfs/course-notes/week-7/
Course hub: https://rebeldonegans.com/finance/rfs/course-notes/
Website: https://rebeldonegans.com/
Copyright notice:
Copyright © Rebel Donegans. All rights reserved.
This transcript is provided for personal educational use as part of Rebel Finance School. You may read it, search it, download it for your own learning, and use it to help you understand the course. Please do not copy, republish, sell, scrape, or redistribute this transcript as your own content.
Attribution:
If quoting or referencing this transcript, please credit Rebel Finance School by Alan and Katie Donegan and link to:
https://rebeldonegans.com/finance/rfs/course-notes/
Disclaimer:
This is financial education, not financial advice. Rebel Donegans are not regulated financial advisers. You are responsible for your own financial decisions.

YouTube Description:

Week 7 of Rebel Finance School goes deeper on the strategy introduced last week: low-cost index investing. Alan and Katie Donegan make the full case - why index funds consistently outperform most actively managed alternatives, how fees that look small quietly destroy your returns over decades, and why the biggest risk to your wealth isn't the market crashing. It's you panicking when it does.

That last point is where this session goes beyond the usual investing guidance. They cover the emotional side of investing — why fear drives people to sell at exactly the wrong moment, and how understanding that impulse is worth more than any stock pick.

By the end, you'll:
• Understand why low-cost index funds beat most alternatives over the long term
• See the real cost of fees compounding against you year after year
• Know why time in the market matters more than timing the market — and how to actually stay the course when things drop
• Have a simpler, calmer approach to investing that doesn't require daily attention

This video is part of a free 10-week personal finance course called Rebel Finance School. For access to the notes, spreadsheets, and more that accompany the course, please sign up here - https://rebeldonegans.com/finance/rfs/ 

Join the Facebook group to get friendly support from like-minded people:   / rebelfinance  

🔗 Links 

Impact of fees on investments: https://rebeldonegans.com/finance/inv...

Can you really judge a fund by fees alone? https://rebeldonegans.com/%F0%9F%92%B... 

Impact of fees tool: https://rebeldonegans.com/finance/res...

The cost of waiting. Just start! (Once you’ve held your horses)
https://rebeldonegans.com/finance/inv...

Disclaimer: We are not financial advisers 💼 This is not financial advice 💰. We are not regulated. We are not trained financial advisors 🎓 We are never going to try and sell you any investments 🛍️ You make your decisions 💭 Sharing our opinions and ideas 💡 These ideas may not continue to work for us or for you. You are 100% responsible for your financial future 💸 There are no guarantees here. For our full disclaimer, please visit: https://rebeldonegans.com/about-us/di... 

#RFS26 #IndexInvesting #WealthBuilding #FinancialFreedom #RebelFinanceSchool #PersonalFinance #FinancialLiteracy

Chapter 1: The investing rollercoaster
0:00Hello and welcome to Rebel Finance School week seven. We are very excited to have you all here. Today is about the
0:077 secondsroller coaster of the stock market. And boy is it a roller coaster at times?
0:1313 secondsAnd we're smack bang in the middle of the three weeks that we're doing on vesting. Last week we introduced the idea of the stock market. What even is it? What does it mean when they say the
0:2020 secondsmarket's up, the market's down? What does that even mean? And now today we're going to talk about the roller coaster and the three ways that this can go wrong. Everyone on YouTube, welcome.
0:3131 secondsPlease tell us where you're from. The advert should have ended. You should be here with us live now and thank you for joining. So, the opening the opening for
0:4040 secondstonight comes from uh 2015 stroke 2016 and we had sold a couple of properties and we had a lump sum of cash to invest.
0:5151 secondsAnd I don't know if you remember that point. It was the point where Brexit was close to happening and there was a new
0:5959 secondspresident in America. Trump was on the edge of getting voted in. Uh the dollar and pound exchange rate was changing and
1:081 minute, 8 secondsI was scared of investing. We had this big lump sum and I did not want to put it in the market. I was scared and my
1:171 minute, 17 secondsfear was backed up with very intellectual stories of geopolitical changes.
1:231 minute, 23 secondsThat sounds of currency exchange rates. I backed up all my fear with very logical stories.
1:311 minute, 31 secondsBut let's be honest, I was scared of investing and I was scared the market would collapse as soon as we put our money into the market. So, we didn't do
1:401 minute, 40 secondsit. We didn't invest. We left the money on the sidelines. What do I mean by that? It was just in a bank account.
1:471 minute, 47 secondsJust in a bank account earning interest, being devalued by inflation and we just left it on the side. So what we've done,
1:551 minute, 55 secondsKatie very kindly [laughter] created a chart to prove how dumb my decision was.
2:012 minutes, 1 secondIt was more to help people to learn and understand. It was not personal.
2:052 minutes, 5 secondsI know [laughter] I have been known to use charts for personal attacks. This was not one of them. So this is uh the Rangguard Footsie developed world index in 2016.
2:162 minutes, 16 secondsUh you'll see 11th of March. Uh that was when we got our first lump sum. So we could have invested it then but we
2:232 minutes, 23 secondsdidn't. We left it. Uh the second lump sum arrived on the 14th of September. So that first
2:322 minutes, 32 secondslump sum had been out of the market from 11th of March to 14th of September. Is that 6 months?
2:372 minutes, 37 seconds6 months. And the market had gone up 15% in that time. So I'd missed out on 15% growth. And then the next lump sum came.
2:482 minutes, 48 secondsWell, actually when we then eventually invested and we left that out until when we actually invested, which was the 15th of December. The price at that point of the
2:572 minutes, 57 secondsfund was £292 a unit, which was another 11% up. Uh any guesses to how much that
3:063 minutes, 6 secondsfear cost me? Put it in the chat. Tell me, Alan, your fear cost you £1,000, £2,000, £50,000. What do you think it
3:153 minutes, 15 secondscost me? Any ideas? Uh Nikki's looking over going, I don't know how much that is. How much is that fear? Uh well, my
3:233 minutes, 23 secondsfear cost us personally £44,000 that year. 44 grand.
3:323 minutes, 32 secondsAnd would you like to know the total cost of Alan's fear? Because it didn't stop there.
3:383 minutes, 38 secondsUh my fear meant that because when we bought later in the year at a higher price, we owned less units and those units have not compounded in the same
3:463 minutes, 46 secondsway. So we have owned fewer units in that fund forever. Katie very kindly updated the figures to show what I've
3:553 minutes, 55 secondslost us this month. And the total but like we updated it this month. So like the running total so far,
4:024 minutes, 2 secondsthe running total so far is just shy of £140,000.
4:084 minutes, 8 secondsSo my fear has cost us personally £140,000.
4:134 minutes, 13 secondsAnd that's a lot of Lego and pizza food.
4:194 minutes, 19 secondsAnd SB is like, why did you do that to yourself? Just forget it.
4:254 minutes, 25 secondsIf it wasn't for teaching this point, I wouldn't have bothered working out these figures. But I work it out so that I can help you avoid the mistakes we've made.
4:344 minutes, 34 secondsCuz there's no point you making the same mistakes we've made. You can make new mistakes. And I do feel guilty. I do
4:414 minutes, 41 secondsfeel bad. But past Alan was doing the best he could. And I have to forgive past Alan. And then I have to go, well,
4:494 minutes, 49 secondswe learned and we will never ever ever make that mistake again. And if I can save you from making those mistakes,
4:564 minutes, 56 secondswell, that's even better cuz I made 140 grand mistake because I was full of fear.
5:025 minutes, 2 secondsAnd I don't want you to ever have to go through that again. And that's where we are starting this week's course.
5:095 minutes, 9 secondsAnd the other part of the story is that yes, we have made mistakes along the way and we've still turned out all right.
5:165 minutes, 16 secondsSo, you probably have made mistakes with your money. We all do. It doesn't mean that you're doomed. It means you've made a mistake. just learn from it and keep going and carry on.
5:245 minutes, 24 secondsAnd we thought we were being careful, but actually what we were really doing was timing the market. We thought we knew better and we would time when we
5:325 minutes, 32 secondsinvest our money. And our brains were trying to protect us. My brain specifically was shouting, "Don't do it.
5:385 minutes, 38 secondsDon't invest." And the reason is because losses feel louder than gains. So when you lose money, it hurts much more than
5:475 minutes, 47 secondsgaining money. It's actually like there's a lot of studies about this that show it's about twice as painful. And this fear is helpful when you're near a
5:565 minutes, 56 secondscliff like don't fall off the cliff but it is not helpful in investing. It makes us do daft things. So welcome
6:046 minutes, 4 secondsto the investing roller coaster because boy it is ups and downs out there and we're going to help you prepare for that.
6:116 minutes, 11 secondsSo this idea of people trying to beat the market, what does that even mean?
Chapter 2: Understanding index funds
6:166 minutes, 16 secondsWell, it means that they're trying to do better than the average returns of all the companies that exist in the stock market after costs and fees. Because the
6:246 minutes, 24 secondspeople that are trying to beat the market, to try to get better returns, there's teams of them. They have costs, they have fees that are involved. But
6:326 minutes, 32 secondsthe key here is that index funds are the market and that's what we introduced to you last week. Index funds are this basket of thousands of businesses. you
6:416 minutes, 41 secondsget the average return of all of those companies and 95 and a half% of active funds, the people trying to beat the market fail to do so. 95 12%.
6:546 minutes, 54 secondsSo the theory we introduced last week was don't search for the needle in the haystack, i.e. the one company that's
7:017 minutes, 1 secondgoing to be successful, just buy the whole hay stack. That's what an index investor is. And we had the analogy of
7:097 minutes, 9 secondsgoing to the races and index investing is not betting on one horse. It's owning all the horses in the race. Then we
7:187 minutes, 18 secondswanted to introduce a new concept this week which is indexes are selfcleansing.
7:257 minutes, 25 secondsWhat does that mean? It means some companies rise and they become a bigger part of the bigger part of the market.
7:327 minutes, 32 secondsSome companies shrink and they become a smaller part of the market. Some companies leave and fail and new companies enter when they become
7:417 minutes, 41 secondssuccessful. So in the horse racing analogy, well the racing lineup changes
7:477 minutes, 47 secondsover time and a horse can get faster. It can do better than the other horses and it naturally becomes a bigger part of
7:557 minutes, 55 secondsthe fund. The fund is weighted to the size of the company. So those as the horses as the companies get more successful, they become a bigger part of the fund.
8:038 minutes, 3 secondsAnd a horse can get slower. So the company doesn't perform well and it naturally becomes a smaller part of the fund over time. And this is the magic.
8:138 minutes, 13 secondsYou don't have to do anything. It happens for you. And then you get the tired horse retiring. Yes. Sometimes
8:228 minutes, 22 secondscompanies like retire, shrink, go bankrupt and the company leaves automatically when they fail or they no
8:308 minutes, 30 secondslonger qualify for the index. And you don't have to decide when to get rid of the company. It naturally drops out. One
8:398 minutes, 39 secondsclassic example of this is one of my favorite stores from the 1990s, which is Blockbusters.
8:458 minutes, 45 secondsBlockbusters used to go there every weekend and pick up a movie. Uh they failed to innovate.
8:508 minutes, 50 secondsThey thought people would still be going to a shop to get uh VHS's. If you're too younger to know what a VHS is, please
8:578 minutes, 57 secondsask an old person near you. um and Blockbuster dropped out of the market. They were a very successful
9:059 minutes, 5 secondscompany. And on the other side, sometimes a new horse arrives. When new companies enter the index when they get to a certain size, and we talked about
9:139 minutes, 13 secondsan IPO, an initial public offering when the company becomes listed on the stock market. But here's the thing, you don't have to predict who these new companies
9:219 minutes, 21 secondsare. The index automatically buys them when they become of a size to qualify for the index. And the classic example
9:299 minutes, 29 secondsis Netflix. So the company that replaced Blockbusters grew uh and became a part of the index.
9:399 minutes, 39 secondsSo the lesson here is not just to hold your horses. The message is to hold all your horses.
9:479 minutes, 47 secondsSo you own every horse in the market and the race lineup changes over time and all you have to do is go and live your life. You can ignore all of the noise.
9:579 minutes, 57 secondsYou can ignore everything. All of this chatter on the internet about SpaceX IPO. Ignore it. It's irrelevant. When it
10:0610 minutes, 6 secondsbecomes the right size, it'll become part of the market. And when it doesn't, it won't be part of the market. So, what
10:1310 minutes, 13 secondshappens to the whole race over time or the whole market over time? Over the long run, the stock market always goes
10:2210 minutes, 22 secondsup and that is over the long run. On average over a long time, it is chaotic in the short run. It's a feels like being on a roller coaster. It's a wild
10:3110 minutes, 31 secondsand crazy ride, but over the long term, the stock market always goes up over the long term. So, we showed you this chart
10:3910 minutes, 39 secondslast time. As the length of time that you're investing over increases, as you're looking at a longer time frame, the chances of losing money goes down
10:4610 minutes, 46 secondsdrastically to the point that there's never been a period over 14 years where the stock market has gone down over that period over those 14 years. So why does
10:5510 minutes, 55 secondsthe market go up over the long run? Why does this happen? Well, behind all these graphs are real active businesses and
11:0411 minutes, 4 secondsthose businesses sell actual products and actual businesses which prices rise over time as they add more value, create
11:1111 minutes, 11 secondsnew products and build. And people are buying all these different things that the companies are making for us like food and insurance and all sorts of
11:2011 minutes, 20 secondsstuff. And actually the population of the world is increasing. So there's more customers, there's more stuff going on, there's more economic activity, just
11:2711 minutes, 27 secondsmeaning there's more people buying and selling stuff.
11:3111 minutes, 31 secondsSome businesses grow, some businesses grow a huge amount, and they all make up part of your index
11:3811 minutes, 38 secondsand they're kind of growing through innovating new technology, and that's how they manage to grow.
11:4411 minutes, 44 secondsExactly. And this is how the compounding bit works where your pounds start to spawn new pounds or your dollars start
11:5111 minutes, 51 secondsto spawn new dollars is because these businesses growing, launching, building new businesses over time
11:5811 minutes, 58 secondsand those profits get reinvested back into what they're doing. So they've got more profits to be able to innovate and to grow and it starts that cycle again.
12:0712 minutes, 7 secondsSo there are thousands of businesses selling stuff, reaching more people, raising their prices over time, growing and improving, reinvesting their profits
12:1512 minutes, 15 secondsand compounding, which means that the market always goes up. But we have a huge warning. The market always goes up
12:2512 minutes, 25 secondsonly applies to broad-based index funds that track the market. It does not apply to individual companies.
12:3412 minutes, 34 secondsindividual companies can go bankrupt. It does not apply to man actively managed funds because actively managed funds are
12:4312 minutes, 43 secondsbuying and selling and trading. It does not apply to individual properties. Some towns go down over time. Some towns go
12:5212 minutes, 52 secondsup over time. So the price always goes up is only if you're in the entire market.
13:0013 minutesNow, there was a couple of very very famous people who did some investment
13:0713 minutes, 7 secondsshows recently and they had advisor on the investment show that said index funds are great for beginners. At which
13:1713 minutes, 17 secondspoint we wanted to strangle them and say, "What are you talking about for beginners?" Um, it's really interesting.
13:2313 minutes, 23 secondsThe people who make money out of selling you actively managed funds and managing your pension will tell you index funds
13:3013 minutes, 30 secondsare a beginner's strategy and it's completely rubbish.
13:3613 minutes, 36 secondsUh we are not beginners. We've been doing this for 10 years. We are professional investors. I don't even know what that means but we were got
13:4213 minutes, 42 secondsmanaged to get certified at it. Uh and we still use index funds
13:4913 minutes, 49 secondsexclusively like you make like it's everything. There's nothing else that they're doing. There's no like next level. There's no like, oh, you poor
13:5613 minutes, 56 secondsbeginners, you do index funds cuz you can't really understand anything else and then you'll graduate somehow to the next level. No, like this is it. There's
14:0514 minutes, 5 secondsno next level. There's no kind of advanced version strategy. This is the strategy that we've been following and that's the one that we're talking about today.
14:1314 minutes, 13 secondsAnd I'd really like you to remember that the next time some expert in a suit says, "Oh, good for you. Index funds are
14:2014 minutes, 20 secondsgood for investors. Laugh at them. Uh good index funds are good for beginners.
14:2514 minutes, 25 secondsLaugh at them because there is no next level. Index funds are the thing we've
14:3214 minutes, 32 secondsinvested in for our entire life. There is no next level. There's no next game no matter what they tell you. So, as
14:3914 minutes, 39 secondswe've presented this to you that you know this investing in an index fund is really quite simple. Well, how does it
14:4614 minutes, 46 secondsgo wrong? And there are three ways it goes wrong. We've affectionately called them the three Fs. What are the three Fs, Alan?
Chapter 3: The three ways to fail
14:5214 minutes, 52 secondsThe three Fs are fees. They can destroy your investment. Fear. You can destroy your investment or fiddling with it.
15:0115 minutes, 1 secondStop fiddling with it and just leave it to do what it does. Those are the three ways you can destroy your investments.
15:0815 minutes, 8 secondsDid you have a couple of comments that we need to look at, Katie?
15:1015 minutes, 10 secondsUh Ruth says, "If you're always getting more stocks, how can your money go down?" Because even with an index fund, it does warn you that money can go down as well as up. Yes, it absolutely can.
15:1915 minutes, 19 secondsThis is coming back to that idea of volatility in the short term that the price changes day to day, week to week, month to month, year to year. But over
15:2715 minutes, 27 secondsthe long run, that's what we're talking about. Over the many years, over the many decades. Yes. And prices will go up and down over the short term. And that's
15:3615 minutes, 36 secondswhere they say investments can go down as well as go up. There's a few people saying, "How do you become a qualified or certified professional investor?"
15:4415 minutes, 44 secondsJust don't bother. It's pointless. It is a waste of your time. You have all the tools you need being a regular investor.
15:5315 minutes, 53 secondsAnd actually, if you become a professional investor, you have to give up your protection levels from the FCA.
15:5915 minutes, 59 secondsSo, I only ever see downsides of becoming a professional investor. It's pointless. Uh, forget that. Just be a
16:0716 minutes, 7 secondsnormal investor. It is better. I see this is a good time to give a message from our lawyers, Alan.
16:1316 minutes, 13 secondsIt is indeed. Okay, so a quick message from our lawyers.
16:2316 minutes, 23 secondsI've got baited breath. This is not financial advice. We are not trained financial adviserss. We are not regulated. We will not sell you investments. You make your own decisions, sharing our opinions and
16:3116 minutes, 31 secondsideas which may or may not continue to work for us or for you. You are 100% responsible for your financial future.
16:3716 minutes, 37 secondsYes, you uh there are no guarantees here except the money back guarantee. If you don't like the course, please see Derek for a full refund.
16:4616 minutes, 46 secondsAnd if you paid for this, something has gone very badly. And this is where we introduce the new warning that investments can and will go up and down
16:5316 minutes, 53 secondsover time. Uh so that is going to happen. If you're watching live on Zoom, please put your questions in this little Q&A box. That means the ninjas can see
17:0217 minutes, 2 secondsit and answer. If you're on YouTube or on catchup, please ask in the comments.
17:0717 minutes, 7 secondsWe love reading your comments. We don't reply to them all now because there's been a lot this week, but I read them all and reply to the ones I can. And if
17:1617 minutes, 16 secondsyou're on YouTube, please hit like and subscribe. It makes us feel nice and helps the algorithm [clears throat] to know this is awesome because it is.
17:2517 minutes, 25 secondsWhere are we on the map? Uh we are at week five, which is investing. Not week five, we're at step five. Yeah, week seven already, Alan.
17:3317 minutes, 33 secondsUh, this is where we are in the process.
17:3517 minutes, 35 secondsLast week we did investing and is your money working for you. This week we've got the investing roller coaster followed by how to read a fund fact
17:4317 minutes, 43 secondssheet. So, we're going to teach you how to read those fund fact sheets from the investments you've already got to understand what it is that you have
17:5017 minutes, 50 secondsinvested already. And then that sets us up to be able to change those investments because week eight is where
17:5717 minutes, 57 secondswe talk about platform accounts and funds. And then we get the actual um
18:0418 minutes, 4 secondsspecifics for the UK, USA, and New Zealand. And week eight, when you're on your journey to financial independence
18:1218 minutes, 12 secondsis where we unleash the horses and you can start going. If you don't live in any of those three countries, UK, New Zealand, US, the main session, the main
18:2018 minutes, 20 secondsweek session is global. It applies wherever you are in the world. Just based on who is attending the school, we've done these three different country specific ones.
18:3018 minutes, 30 secondsUh week nine is the maths of retirement and we're launching a brand new retirement calculator. And week 10 is for those of you in or around
18:3818 minutes, 38 secondsretirement. How do you make sure your money lasts the whole way through? So on the investing questions for platform,
18:4618 minutes, 46 secondsaccount and fund, just hold your horses until week eight and we will get there.
Chapter 4: The cost of high fees
18:5118 minutes, 51 secondsNow the three Fs, Alan, the three Fs, let's start on fees. Fees are one of the most important things in
18:5918 minutes, 59 secondsinvesting because they can suck the life from your freedom fund. Think of them like a vampire that is guts its claws into your freedom fund and is feeding on it.
19:0919 minutes, 9 secondsAnd most people have no idea what they're paying for. Most people before week one didn't even know like what subscriptions they have. So, how do you
19:1719 minutes, 17 secondsexpect them to know how much they're paying for their investments? Especially when a companies call all the investment fees boring names. You have a platform
19:2419 minutes, 24 secondsfee, you have a fund fee, you have an advice fee, a dealing fee, entry and exit fee. They just layer fees after
19:3219 minutes, 32 secondsfees after fees. Now, these terms, what do they even mean?
19:4019 minutes, 40 secondsWell, this is the learning a new language bit. So, we have some terms this week that are a new language, but we're going to do our best to slow down, explain them all, and help you get them.
19:4819 minutes, 48 secondsIf you don't get something, just put it in the chat. Ask a ninja or the wonderful producer this week will stop us and tell us we need to quit out of
19:5719 minutes, 57 secondsthe slides and explain it again. So, if you doesn't make sense, stop us and we'll tell you.
20:0320 minutes, 3 secondsWhat we wanted to say as we go into this, like paying fees is inevitable. There are fees involved with investing.
20:0820 minutes, 8 secondsYour job is to minimize them and we just want to make you aware of the different types of fees that they are so that you can start to understand how you might minimize them.
20:1620 minutes, 16 secondsThe number one fee is a platform fee and basically what that is is you're paying to keep your freedom fund somewhere. So
20:2520 minutes, 25 secondsyou're paying those people to have the platform that supports your freedom fund. Then when you've got the freedom
20:3220 minutes, 32 secondsfund there, it's got to be invested in something and that fee is called the fund fee. and that pays for the people
20:3920 minutes, 39 secondsto run the investments that your freedom fund is invested in. So, platform fee and fund fee.
20:4620 minutes, 46 secondsThen there's the advice fee, which is paying someone to tell you what to do.
20:5220 minutes, 52 secondsThen we've got the dealing fee, which is one of my favorite photos Katie generated. Uh, a dealing fee is where you pay every time you buy and sell.
21:0221 minutes, 2 secondsSome places charge you a tenner when you buy, a tener when you sell. Other places charge you a percentage.
21:0721 minutes, 7 secondsAnd then finally, there's an entry and exit fee. Sometimes you pay to get in when you invest your money and they also charge you when you want to leave and go
21:1621 minutes, 16 secondsand invest somewhere else. So those are the different fees. You don't have to pay most of them. But all of these fees
21:2521 minutes, 25 secondstogether are layers and layers of fees that are taking a slice out of your freedom fund. And the more layers you have, the quicker it steals from your freedom fund.
21:3621 minutes, 36 secondsAnd we paid quite high fees with our first investment that we had. So I went to a independent financial adviser. He's the one that did this risk profile.
21:4421 minutes, 44 secondsSays, "Katie, are you okay with losing money?" To which I said no. And then he put me in a so-called safe portfolio with the following fees. There was a platform fee of6%.
21:5521 minutes, 55 secondsFund fees 1.61% and an initial investment fee. Every time I put money in, he took 3% of it for his commission, which is an entry fee. Yes.
22:0522 minutes, 5 secondsAnd we felt very uneasy about those fees. But we didn't really know any better. We had no idea what it meant at that time.
22:1222 minutes, 12 secondsWe didn't know the range. We didn't know what was a low fee, a high fee. I was just like, "Dude, I want to grow my freedom fund. Let's go. Okay, those are
22:1922 minutes, 19 secondsthe fees." We just kind of accepted it without really understanding or knowing whether that was a good way to invest, whether that was the right thing to do.
22:2822 minutes, 28 secondsWe just were like, "Okay, let's go." Current US is kind of horrified that past us didn't check what good fees were, but we were doing the best we could.
22:3722 minutes, 37 secondsYeah.
22:3822 minutes, 38 secondsAnd most people have no idea what fees they're actually being charged for their investments.
22:4422 minutes, 44 secondsYou think about it, most people will like shop around for their washing machine or a car or something they're thinking of buying. Why do we not do that when it comes to investments? One
22:5322 minutes, 53 secondsof the most important places that it matters. And it's because we're not taught to. We're not trained to do that.
22:5822 minutes, 58 secondsMost of us don't know that unless we've kind of learned for ourselves. And it also sounds like a small number.
23:0523 minutes, 5 secondsLike they say to you, "Oh, it's only half a percent, 1%, 1 and a half%, 2%." You're like, "Ah, 1%, that's not a lot."
23:1223 minutes, 12 secondsBut small numbers have big consequences over time. So, here is the big first example. We want to introduce three characters to you with different fees.
23:2323 minutes, 23 secondsMeet Ellie, Larry, and Gloria. These are the three people, and we're going to show you what fees they are paying at the different
23:3223 minutes, 32 secondslevels and then analyze whether they affected them or not over time. So, we'll start off with platform fees. So, this reflects for Larry and Ellie the
23:3923 minutes, 39 secondsplatform fee that I had with my initial investment, which was 6% and then Gloria is invested in a lowcost uh platform and paying 0.15% and that's capped at 375.
23:5123 minutes, 51 secondsYou might think this is a very specific example. Well, this is actually what happens with Vanguard's platform.
23:5623 minutes, 56 secondsIt's modeled on Vanguard. Uh then you've got fund fees. Larry's paying 1.65. Uh
24:0224 minutes, 2 secondsEllie's decided to have a uh cheap index fund, which is fantastic, and Gloria also has a cheap index fund. So, you can
24:1124 minutes, 11 secondssee uh Larry's got the high fees, Ellie's in the middle, and Gloria's low.
24:1624 minutes, 16 secondsUh advice fees. Larry has an adviser charging him one charging him 1% of his assets under management every year.
24:2424 minutes, 24 secondsEllie also has an adviser, but Gloria is going the DIY route. She's doing herself. She doesn't have an adviser fee.
24:3224 minutes, 32 secondsDealing fees. Larry has a 3% entry fee, which is just like Katie had. Ellie has a 1% fee and Gloria doesn't have any
24:4124 minutes, 41 secondsfees cuz she's doing it herself. Exit fees. Larry has a half a percent on the way out. Ellie doesn't and Gloria has low fees because she's doing it herself.
24:5124 minutes, 51 secondsSo to summarize, Larry has high fees, Ellie has advisor fees and Gloria has low fees.
25:0125 minutes, 1 secondWhat do you think the difference will be? Please tell us now. Uh the assumptions are they all started with £25 grand to
25:1025 minutes, 10 secondsinvest and they put in £400 a month afterwards for 30 years. They all got exactly the
25:1825 minutes, 18 secondssame returns. We modeled the returns on the S&P 500 which is the 500 biggest companies in the US. Why did we do that?
25:2625 minutes, 26 secondsWe use a US index because they have the most data in the US. We just don't have a global fund going back that far. If we did, we would definitely use that instead.
25:3425 minutes, 34 secondsSo, they have exactly the same investment returns. Uh, please don't compare your pineapples with Ellie,
25:4125 minutes, 41 secondsGloria, or Larry. Uh, they just are made up examples to show you the fees, but the fees are real. How much fees do you
25:4825 minutes, 48 secondsthink the difference was between the top and the bottom? Do you think it's 10K?
25:5325 minutes, 53 secondsDo you think the fees affected 20K? How about 50K, 100K, or more than that? What
26:0126 minutes, 1 seconddo you think? How much do you think it affect? Please put it in the chat.
26:0426 minutes, 4 secondsYouTubers tell us. I want to know. Uh few people putting more, some people putting 20k.
26:1026 minutes, 10 secondsA lot of people saying more, more than 100k.
26:1226 minutes, 12 secondsWell, you saw how much my fear cost us at the start. Uh let's go to the chart to show you. So, here's the chart.
26:1826 minutes, 18 secondsSo, this is showing the values of their freedom fund over time. So, Gloria is green, Ellie's orange, and Larry is blue. And you can see they're following
26:2526 minutes, 25 secondsthe same kind of shape of what happened with the stock market over that time because they have the same investments. They have exactly the same investments.
26:3226 minutes, 32 secondsCan you see now over time how they're starting to separate? How they're starting to diverge and Gloria at the
26:3926 minutes, 39 secondstop there has gone way past what Larry has and significantly more what Gloria had from the same investment returns. They got the same underlying investment.
26:4726 minutes, 47 secondsThis is the fees that's doing that. So Larry with his high fees returned 436,000
26:5526 minutes, 55 secondsand Ellia Ellie sorry Gloria with her low fees returned 852,000.
27:0227 minutes, 2 secondsSo the difference between high fees and low fees is 416 grand. Isn't that insane?
27:0827 minutes, 8 secondsThat's a lot. That's significantly more than the options we gave her. The highest option gave was 100k. This is four times that. Bonkers.
27:1527 minutes, 15 seconds416 grand gone. just evaporated and we thought we'd bring that to life. Imagine
27:2227 minutes, 22 secondsit as years of your life. So if you spent 60 grand a year, well that is 7 years of your life that has vanished.
27:2927 minutes, 29 seconds[laughter]
27:3127 minutes, 31 secondsYou'd have to work 7 years longer to get the same returns. Or if you spent 40 grand a year, it is 10 years of life. Or
27:3827 minutes, 38 secondsif you spent 30 grand a year, it is 14 years of your life you could live on the extra you got just cuz you didn't pay fees. and fees destroy compounding.
27:4927 minutes, 49 secondsSo you think about when we talked about a percentage of your money and how that works for for you. Well, they're taking a percentage each time. That's why we
27:5727 minutes, 57 secondstalk about minimizing the fees. So Larry, Ellie, and Gloria all put the same amount in, but the amount of compounding that they got was wildly
28:0628 minutes, 6 secondsdifferent. So Larry ended up with that 436K.
28:1028 minutes, 10 secondsEllie put the same amount in and got 176k more in compounding because
28:1728 minutes, 17 secondsher fees were lower. And then what about Gloria?
28:2028 minutes, 20 secondsGloria just destroyed them both. She ended up with the 832 which if you combine the difference from Larry uh is 416 grand. And fees destroy compounding.
28:3128 minutes, 31 secondsSo what actually happened? Same investments, same market, same contributions. The only difference is fees.
28:4028 minutes, 40 secondsAnd that is what we wanted you to get.
28:4228 minutes, 42 secondsLike 1% is huge and will destroy your financial future. Fees is the difference. And you might be asking, does anyone actually pay these fees?
28:5328 minutes, 53 secondsYes, we have met many of them on this course. They turn up, they didn't understand fees. We didn't understand fees. We had no idea.
29:0129 minutes, 1 secondSo the message is fees matter. And the other message is Larry's story like we see this time and again. If this has
29:0929 minutes, 9 secondshappened to you, that's normal. This is what we see time and again. And that's why we give these examples because we've seen it so many times and we trust the
29:1729 minutes, 17 secondsexperts and we don't question what we're told. That's that's what happens and it's completely normal. We did this Katie's first investment. We trusted the
29:2629 minutes, 26 secondsadviser. We stayed with them for two years. And what we did want to say to anyone here who's got high fees investment currently,
29:3429 minutes, 34 secondsyou are everyone is better off than never bothered Ned.
29:3829 minutes, 38 secondsSo Larry did better than someone who never invested. So you've done well with the information you have. We just have to change it to be able to get you more.
29:4829 minutes, 48 secondsAnd we wrote an article going, "But it's only 1%." So this shows all the charts, all of the information if you need it
29:5629 minutes, 56 secondsabout investments. Uh for those of you on YouTube, it's in the YouTube description. All the ninjas will put it in the chat as well. And to explain the impact of fees, this is how it works.
30:0830 minutes, 8 secondsThe fees taken, once that fee is taken from your account, that money can then never grow because it's not yours. The adviser has
30:1630 minutes, 16 secondsit. And then the next year there's no growth on that growth. And the next year there's no growth on that growth. And the next year there's no growth on that
30:2430 minutes, 24 secondsgrowth. And the impact of fees is you will have fewer units forever.
30:3130 minutes, 31 secondsAnd it's the compounding destroyer. And fees don't look scary. It's like, oh, it's this cute little number of 2%. No, fees will quietly steal your future.
30:4330 minutes, 43 secondsThey will destroy your financial future.
30:4630 minutes, 46 secondsWhen it comes to advisor fees, there's two different ways that they do it. So, you can pay a fixed fee where you just pay for whatever advice. It's kind of
30:5430 minutes, 54 secondsproject based thing of I've got this problem. Will you help me solve it? Pay for that advice. or this thing called aum, assets under management, which
31:0331 minutes, 3 secondsmeans you give away a slice of your freedom fund, a percentage of your freedom fund every year forever. Which type of fee would you rather pay?
31:1331 minutes, 13 secondsI know which one I'd rather pay. I'd rather pay the fixed fee. But what do you think is the most common type of fee? Well, the most common type of fee is assets under management. Why?
31:2531 minutes, 25 secondsBecause it's a genius business model for them. The advisers make a fortune and even if they don't manage to outperform
31:3231 minutes, 32 secondsthe market, they get paid. They get paid no matter what. Which then at this point we get this thing that people say, "Okay, I get the fees matter, but surely
31:4231 minutes, 42 secondsif you pay someone in a suit, they'll perform better than the market. Surely the professionals do the better." Which
31:4931 minutes, 49 secondsactually brings us on to the Buffett bet. And Warren Buffett is one of the best investors the world has ever seen.
31:5731 minutes, 57 secondsHe owns a company called Barkshshire Haway and about 15 years ago he put out a challenge and he said I don't think
32:0632 minutes, 6 secondsactively managed uh funds with high fees will beat an index fund. So he put out this bet and he said I will take a bet
32:1532 minutes, 15 secondsfrom anyone out there and I bet you a million pounds or a million dollars sorry that goes to charity. If I put my
32:2332 minutes, 23 secondsmoney in the S&P 500, it'll outperform anything you can do over 10 years and there was a fancy adviser in New York
32:3232 minutes, 32 secondsthat decided, I'll take that bet. I'll prove that I am better than the index.
32:3832 minutes, 38 secondsAnd he had the smartest people in the world working for him. Huge teams of analysts, huge teams of people that were
32:4532 minutes, 45 secondsconstantly monitoring the investments and working on it. and they were allowed to invest in any company, any fund, do
32:5332 minutes, 53 secondsanything they want. And all Warren Buffett did was buy one simple index fund and leave it.
33:0133 minutes, 1 secondSo, what do you think happened? Who do you think won the bet over time? You probably know the answer because we're
33:1033 minutes, 10 secondssetting this up this way. Uh, but who do you think won? Well, Katie created an amazing new chart. We love charts. We worked out based on what happened how
33:1833 minutes, 18 secondsmuch Warren Buffett would have needed to put in at the beginning to get to the million at the end and then see how that compared against what happened with the
33:2633 minutes, 26 secondsactive investing with those fund managers that he uh did the wager with.
33:3133 minutes, 31 secondsSo this is their starting amount. I love that Nikki and husband leaned in at that point. That made me very happy to see
33:3733 minutes, 37 secondsthe stats. Uh so in year two it was actually the 2008 financial crisis. So index funds, the orange bit had done
33:4633 minutes, 46 secondsworse than the active manager in year two. Uh 2009 they' done a little bit
33:5233 minutes, 52 secondsworse. Uh 2010 they were kind of breaking even compared to the active investing. Uh and then they did pretty
34:0034 minutesmuch break even. And at this point from 2012 onwards, the index fund started to outperform everything the actively
34:0734 minutes, 7 secondsmanaged fund did. Uh and then they were careering ahead. and the actively managed fund actually threw in the towel a couple of years early because he knew
34:1634 minutes, 16 secondshe couldn't make up those differences and by the end of it they'd absolutely destroyed it. And we introduced on
34:2434 minutes, 24 secondsThursday last week the 10k test. If you'd have invested with the actively managed uh adviser from New York who
34:3134 minutes, 31 secondsthought he could beat index funds, you would have got £2,431 of profit and that is 2.2% return over
34:3934 minutes, 39 secondsthe years. Yes, that is less than a bank account. The fancy advisor with high fees earned less than a bank account
34:4834 minutes, 48 secondswhereas the passive investing doubled and it got an average of 7.1% even through the great financial crisis of
34:5634 minutes, 56 seconds08. So paying more did not buy better performance.
35:0235 minutes, 2 secondsBuffett aimed to prove fees matter and he did. He also proved active managers got worse performance.
35:1035 minutes, 10 secondsYou pay more, you get worse. And even the smartest people in the world can't outperform the market. At which point, you're probably looking at us going,
35:1835 minutes, 18 seconds"Okay, okay, okay. We get it. Fees matter. We get it. Active fails to beat the market. But what do good fees look
35:2635 minutes, 26 secondslike? How much should I pay?" Before we tell you that, a message from our sponsors. We don't actually have any sponsors. If you're watching on YouTube, please hit like and subscribe so the
35:3435 minutes, 34 secondsalgorithm knows that this is good stuff and more people will see it. Thank you very much.
35:3835 minutes, 38 secondsLove you, YouTubers. So, what is a good fee? So, remember, paying fees in is inevitable. Your job is to pay as little
35:4535 minutes, 45 secondsas possible and what's reasonable actually varies around the world. It varies by country. And we're going to go into the specifics of that in week eight
35:5335 minutes, 53 secondswhen we talk about the actual specifics of investing in different countries. But to give you an idea, we're going to do the UK example since most people on this
36:0036 minutescourse are from the UK. What is a a high fee? Well, anything more than 2% of what you have with the platform. That is a
36:0936 minutes, 9 secondshigh fee for a platform fee. It should be 0.15 or even free. Uh when you're in
36:1636 minutes, 16 secondsretirement, you can't really get a free one that does a good job for you. So, you need to pay a little bit. Uh but on your way to retirement, you could get a free platform. Fund fee.
36:2736 minutes, 27 secondsFund fee. A high fee is anything more than.3%.
36:3136 minutes, 31 secondsA decent fee, you're looking in the range 0.1 to 0.25%. uh advice fees.
36:3836 minutes, 38 secondsSo advice, never, please never, ever, ever give them a percentage of your freedom fund. That's that asset under management thing we were talking about.
36:4636 minutes, 46 secondsSometimes you're going to want advice.
36:4736 minutes, 47 secondsSometimes you're going to want a specific question answered. Please help me set this up. Pay an ad hoc fixed fee if you need it. And then we had a
36:5536 minutes, 55 secondsquestion in the chat saying, "Where do I find one of these fixed fee advisers? Do they exist in the UK, Anna?" Uh, so if you're in America, our friend Jeremy
37:0337 minutes, 3 secondsruns a service called Hello Nectarine, which actually connects you with fixed fee advisers. If you're in the UK, we
37:1137 minutes, 11 secondsdon't know. Uh, I don't know how to find a good fixed fee adviser. There's not a service that does that yet. Uh, and
37:1937 minutes, 19 secondsactually what's interesting is by the time you know enough to choose whether an adviser is good or not, you don't
37:2637 minutes, 26 secondsneed one. Uh, and this course should give you most of what you need and you can ask in the Facebook group, the ninjas. There's a whole community. Uh,
37:3537 minutes, 35 secondsbut I don't have a good answer for where to find a fixed fee advisor in the UK. I wish I did.
37:4137 minutes, 41 secondsIt's not like there's a platform in the US, for example, that Alan mentioned that is a collection of these types of advisers. As far as we know, no such
37:4937 minutes, 49 secondskind of collection or way to like a a catalog, a library of them. We don't know of one. So, it's going to be a question of finding it the way you would
37:5837 minutes, 58 secondsfind anyone, like googling around, asking around and please interview them and ask them a bunch of questions. Don't just go with the first person you find.
38:0738 minutes, 7 secondsPerfect. A few people have saying, "Can I have the slides again for the fees?" Uh, this is the platform fee. Take a photo, write a note. Uh, it'll also be
38:1538 minutes, 15 secondsin the course notes. This is the fund fee slide so you know roughly what they are so you can have an [clears throat] idea. Take a photo, write a note, do that sort of stuff. Uh, and then the
38:2438 minutes, 24 secondsadvisor fee that gives you an idea of those fees. But the warning, sometimes the advice fee is included in the
38:3138 minutes, 31 secondsplatform fee and you need to be very careful about those and look about the different ones. Uh, dealing fee, half a
38:3938 minutes, 39 secondspercent or more is bad, very bad, and you shouldn't really be paying a dealing fee. Uh some platforms charge you like
38:4838 minutes, 48 seconds$10, £10 to buy in and out, but it should be very very minimal. Then we've got entry and exit fees. Anything more
38:5638 minutes, 56 secondsthan zero is generally bad. Uh it should be zero. In New Zealand, there is a platform that has an entry and exit fee
39:0439 minutes, 4 secondsthat the fees are so cheap inside it, it makes it worth it. But we'll come on to that in the New Zealand session. And this is the final chart to help you with
39:1339 minutes, 13 secondsthis on total fees in the UK. Lower than 0.4% total fees is okay.
39:2339 minutes, 23 secondsLower the better, but lower than 0.4 is okay. Medium fees are between 0.4 and 1%. You should not be paying that. And really, I should make this binary.
39:3439 minutes, 34 secondsAnything above.4 is bad. Um, but 0.4 to 1% is not great. Terrible fees are 1 to
39:4139 minutes, 41 seconds2% and daylight robbery is 2% plus. And then you ask where St. James's Place on this slide. St. James's Place is above
39:5039 minutes, 50 seconds2%. And that's why we keep harping on about these different wealth managers. And why does St. James's Place come up?
39:5739 minutes, 57 secondsIt's because they're the biggest wealth management company in the UK and they have over a million customers. We don't pick on them because we want to make
40:0540 minutes, 5 secondspeople feel bad. I pick on them because I want to save you from them. And we're just going to talk a little bit about fee comparisons and then I think Katie's
40:1440 minutes, 14 secondsgot a couple of bits to go to. But fee comparisons. St. James's Place did this fee comparison review. And they hired
40:2240 minutes, 22 secondssome fancy advisers, Ernstston Young, to review their fees. And you can see in that little chart, look, they created a
40:3040 minutes, 30 secondsbeautiful chart that shows they have reasonable fees. To show you the difference, I thought I would put Vanguard's fees next to this. Uh, so
40:3840 minutes, 38 secondshere's Vanguard's fees. So, if you were to actually add a proper comparison to this chart, you would just like it's
40:4640 minutes, 46 secondscrazy what they do. But that's the advisor and how they hide their fees. Do we need to cut out for a second?
40:5540 minutes, 55 secondsJust have a look at that whilst I do the next little bit. Okay.
40:5840 minutes, 58 secondsAnd so that's the UK stuff that we're talking about there. In the US, you have such a more developed market than a lot of countries around the world. You have
41:0641 minutes, 6 secondsso many more millions of customers. The fees in the US are virtually zero. And we're going to go into more of that when we do the US specific section. You are
41:1441 minutes, 14 secondsso lucky in the US how low your fees are. So in the US, low fees is anything really less than.15%.
41:2241 minutes, 22 secondsAnything more than that, you're talking daylight robbery because it is such a low fee way of investing in the US.
41:2841 minutes, 28 secondsExactly. and you the US has high management fees. The St. James's Place of the US is called Eddie Jones. It's the same thing. And we're going to deal
41:3741 minutes, 37 secondswith all of these in the country specifics. Okay. So, we're going to pause the presentation there for a second. Uh I think I created a storm of
41:4641 minutes, 46 secondsstuff in the chat by saying we got professional investor status. Uh the reason we did that is because we wanted
41:5441 minutes, 54 secondsto understand what it is. It's actually irrelevant on our journey. It doesn't help us do anything. No. Uh we did it
42:0142 minutes, 1 secondthrough a firm called Interactive Brokers, IBK, IBKR. They have high fees.
42:0842 minutes, 8 secondsYou should never use them. Stay away from them. Uh the only relevance they might have is if you are someone who is
42:1642 minutes, 16 secondsmoving around the world. So if you're someone who sort of lives in one country, invests in another country,
42:2442 minutes, 24 secondsthey are set up to be able to do it over different countries and they have a purpose and a use then. But in general,
42:3242 minutes, 32 secondsit's platform you don't need and this professional investing thing is a complete side quest that's irrelevant to 99.99%
42:3942 minutes, 39 secondsof humans in the world. We don't hold any like certifications. It didn't have to sit an exam. It was just like something that we had to say like, "Oh, we have these criteria that we've met.
42:4842 minutes, 48 secondsTherefore, we think we qualify for your little badge. The badge is not helpful to, as Alan said, everyone, including
42:5742 minutes, 57 secondsus. It has made no difference to what we're doing." No, we thought it might, but it has made no difference. So, it's good that we learn and then you don't have to bother wasting your time on something like that. So, hopefully that cleared it up.
43:0843 minutes, 8 secondsIf you have more questions, let us know.
43:0943 minutes, 9 secondsWe we were thinking at some stage we might write about the irrelevance of it all. I didn't want to waste your time,
43:1643 minutes, 16 secondsso I haven't. Um, yeah. So, I kind of Sorry I brought that one up, but yeah, it just is. It is.
43:2443 minutes, 24 secondsOkay. We had one last question, which is, if I'm with a wealth manager, how do I get out? Well, week eight will show
43:3243 minutes, 32 secondsyou how to set up a platform for your SIPs and your ISES. you would set up a new platform and on that platform there's normally a button that says transfer in existing investments.
43:4443 minutes, 44 secondsSo on your new platform you give them the details of your old platform which is St. James's Place or um
43:5343 minutes, 53 secondsQuilter or whatever other wealth manager and you say take my investments from here and bring them over for my new one.
43:5943 minutes, 59 secondsYou don't even need to speak to your adviser if you want to. you can just set up a new one and set the transfer going.
44:0644 minutes, 6 secondsSo that makes it easier. Lisa has shared a fantastic article in the chat which is how to change advisers or how to like
44:1344 minutes, 13 secondstell your adviser you're breaking up with them. It's a bit like a relationship, isn't it? It's not me, it's you. Uh and we have to break up
44:2144 minutes, 21 secondsnow. Thanks for your time. Uh yeah, Katie's doing it. We need to move on bit. [laughter] Okay,
44:2844 minutes, 28 secondsthat was just for your benefit. I wasn't trying to tell the whole world which is why I did this little signal underneath the table and no one and now everyone
44:3744 minutes, 37 secondsknows. So that was not as subtle as I was hoping. So what is the message in all of this? It's one of those areas of life where you don't get what you pay
44:4444 minutes, 44 secondsfor with these fees. You get what you don't pay for because that money is compounding for you and has not been
44:5244 minutes, 52 secondseaten away at that compounding machine that we're all trying to build.
44:5544 minutes, 55 secondsExactly. So what matters when choosing funds and fees? And that's what we talk about all the time, funds and fees. And
45:0245 minutes, 2 secondsthere was an interesting new study that came out recently that studied the success factors for a fund. So how do
45:1045 minutes, 10 secondsyou choose a fund that is success factor? Uh how do you choose a fund that will be successful for you? And they looked at number of companies it's
45:1845 minutes, 18 secondsinvested in, size of the fund, whether it was active, whether it was passive, uh all of the different factors. And
45:2645 minutes, 26 secondsthere was one factor that made all the difference. You can probably guess what it is, can't you? Can you guess?
45:3545 minutes, 35 secondsThe one factor that made all the difference was fees. The cheaper the fund, the more likely it is to do well over time. And it's really interesting
45:4445 minutes, 44 secondsbecause fees are how the financial industry makes money. And this is how it works. Active funds have higher fees.
45:5345 minutes, 53 secondsIndex funds have lower fees. So if you buy a cheap fund, you're more likely to get an index fund. And over time,
46:0046 minutespassive investing always wins. So that is the one factor that affects your investing. So if you had to pick on one
46:0946 minutes, 9 secondsreason, like what fund to go for, you would pick the cheapest. There's a little bit more to it, which we'll do in week eight, but that's the one thing that makes a real difference.
46:1946 minutes, 19 secondsOne of the things that different providers do will have different fees.
46:2246 minutes, 22 secondsSo, we listed a bunch of things like, well, the platform fee and a a dealing fee and these different fees. Sometimes it's really tricky to compare them because they've got different things.
46:3246 minutes, 32 secondsSometimes it's a fixed amount rather than a percentage. So, if only there was a tool, Alan, to compare all those [laughter] different elements. Well,
46:3946 minutes, 39 secondshaha. A couple of years ago, I developed this tool and then with the Ninja help, we've improved it and added some more bells and whistles. You can add in all
46:4746 minutes, 47 secondsthe different fees that you have, all the different ones that you might be wanting to compare it to, and see what the impact is over time.
46:5446 minutes, 54 secondsAnd it's auto set up so that the comparison fund is Vanguard on the right, and you can compare your existing fees to that. So that's the end of fees.
47:0347 minutes, 3 secondsI feel like we've hammered fees. I think we know how we feel about fees.
Chapter 5: Managing investment fear
47:0747 minutes, 7 secondsSo let's move on to the second F of three Fs, which is fear. Let's talk about fear, an fear. Okay, fear is a huge thing and we
47:1647 minutes, 16 secondswanted to start by saying like fear is not stupidity but we understand why we get afraid. Fear is protection and money
47:2547 minutes, 25 secondsrepresents safety so we get even more protective over that and the losses feel painful. The stock market is unfamiliar
47:3247 minutes, 32 secondsand then the entire media is shouting at us about crashes and gamles. This was an article saying the stock market could
47:3947 minutes, 39 secondscrash in June. Uh, and they love writing articles like this every month and then it doesn't crash. They'll be right one month out of every two years. Um, but
47:4947 minutes, 49 secondsthey love to shout at you. And the losses, if the market goes down, when the market goes down, feel louder than
47:5747 minutes, 57 secondsthe gains. And losses feel twice as painful as the gains feel good. Especially if you've never experienced.
48:0648 minutes, 6 secondsThis this is a lot. You know, when we're not used to looking at and understanding investments, suddenly you can see them going down in value and understandably
48:1448 minutes, 14 secondsyou could freak out. Like that makes sense. Fear can actually be useful. I'm afraid of snakes. That is a very useful fear cuz I can't tell which snake is
48:2348 minutes, 23 secondsvenomous and which snake is not. So, it's useful to be afraid of all snakes. Fear is not useful in other situations.
48:3148 minutes, 31 secondsAnd the stock market is a roller coaster of emotions. So this is how it works. So when the market's going up, meaning in general the prices are going up, there's
48:4048 minutes, 40 secondskind of this euphoria and this greed of like, oh, things are going well. I'm really excited.
48:4548 minutes, 45 secondsThen it goes down, which inevitably it will, and there is fear, panic. We get to the bottom and we despair that we'll ever turn around.
48:5448 minutes, 54 secondsThen it turns around and then there's euphoria again. You know, this can never this will just keep going forever and we kind of have this recency bias, meaning we think that whatever's happening
49:0249 minutes, 2 secondsrecently is going to keep going. Then it goes down and we get fear again. Then it goes up and we get euphoria and greed.
49:0849 minutes, 8 secondsAnd then it cycles again and we get the panic. And that is the neverending roller coaster of the stock market.
49:1449 minutes, 14 secondsHowever, the stock market always goes up over time. And this is a long long long chart
49:2449 minutes, 24 secondsfrom 1942 to 2022 showing the stock market going up. And when people see
49:3149 minutes, 31 secondsthis long chart, they look at this first bit and go, "Yeah, the stock market's always gone up, but what happened here?
49:3749 minutes, 37 secondsWhy is it flat? Why did nothing happen in those like 40 years at the beginning?
49:4349 minutes, 43 secondsWhy did nothing happen? Do you know why nothing happened?" Brian is leaning in staring at the chart like, "I don't know why nothing happened, Alan." Maybe Brian
49:5149 minutes, 51 secondsdoes know why it happened. Actually, it's the scale. So, if we zoomed into this area of the chart, this is what you
49:5849 minutes, 58 secondswould see. And you would see that the stock market always goes up, but it's just a bouncy line over time.
50:0550 minutes, 5 secondsAnd it kind of had that familiar shape, doesn't it, of the ups and the downs, and then there's an up. And that's what we're talking about, the volatility in the short term, the ups and downs, that
50:1450 minutes, 14 secondscrazy wild ride. But over time, it always marching on upwards because it's not linear, Ellen. It's not a straight line. Much as we wish it would be that
50:2250 minutes, 22 secondsit would just march up a certain percentage every year, I'm afraid it doesn't work like that. So, let's talk about we've we've talked a lot about the
50:2950 minutes, 29 secondsmarket goes up over time. Let's talk about what happens and how it feels and how to respond when it goes down because the we're saying when, not if, because
50:3850 minutes, 38 secondsit is inevitable. It's part of how this beast works. It's the natural cycle. And you'll see this first crash, these are
50:4650 minutes, 46 secondsthe recent market drops. This one here where you see the market going down was the 2001.com bubble.
50:5450 minutes, 54 secondsThe next one along is the '08 financial crisis and you can see it going down there. When those two happened, it felt like the world was ending. Um, but then
51:0251 minutes, 2 secondsit bounced back afterwards. Then we've got the COVID crash. That was a very sharp crash, but it didn't last very long. Uh, then we had the Ukraine war in
51:1151 minutes, 11 seconds2022. Uh, and then we had the tariff drop in 25, and we've had a few more drops. But there is always these crashes
51:1951 minutes, 19 secondsand drops as we go along. And we use this term, the market is crashing. But what does that even mean? And we just wanted to give you some terminology to
51:2851 minutes, 28 secondshelp you to understand the different terms that you might hear in the media or other people talking about. Number one, bull market. Bull market is when
51:3851 minutes, 38 secondspeople are optimistic, confident, and prices are going up.
51:4351 minutes, 43 secondsImagine a bull charging forward. The market is charging forward and charging up. That's optimism. and people start saying things like, "I'm feeling bullish about this." It means they're confident.
51:5351 minutes, 53 secondsIt means they're optimistic and they think it's going to keep going up.
51:5651 minutes, 56 secondsThen you have a market correction. A market correction is a fall of at least 10%.
52:0352 minutes, 3 secondsThat's the like general agreed on term.
52:0652 minutes, 6 secondsA market correction happens at least on average every two years. So roughly every two years and this is not
52:1352 minutes, 13 secondsclockwork like on December every two years it happens. It's an average time frame. Sometimes you get two in a year, sometimes you get none for three years,
52:2252 minutes, 22 secondsbut on average every two years you get a fall of 10% of the market. Which brings us on to the third term, which is a bare
52:2952 minutes, 29 secondsmarket. The bare market, the grizzly bear, he's very unhappy. The market has fallen at least 20%.
52:3752 minutes, 37 secondsSo corrections 10%, a bare market's 20%.
52:4152 minutes, 41 secondsAnd on average, a bare market happens every four to 5 years. So every four or five years we have a bare market.
52:4852 minutes, 48 secondsEveryone gets very upset. It goes very badly and then it recovers. That's the pattern. Then the final one is a full-on
52:5652 minutes, 56 secondsmarket crash. That's the big ones like the '08 uh financial crisis, the dotcom
53:0453 minutes, 4 secondsbubble. There was a few others in history. Uh and it's a fall of at least 30%.
53:1053 minutes, 10 secondsOn average that happens every 12 years.
53:1453 minutes, 14 secondsSo there's a big one like that every 12 years or so. Sometimes it's 15 years, sometimes it's 5 years, but the average is 12.
53:2353 minutes, 23 secondsAnd it's you can't set your watch by this. It's not like, oh, the last one was 6 years ago, therefore the next one's in six years. It doesn't work like that. This is average. Could you imagine
53:3253 minutes, 32 secondsbeing like, oh, it's coming. Yes, it happens. It just it doesn't work like this is we're talking about on average.
53:3753 minutes, 37 secondsNo one can predict. No one knows what's going to happen. Despite these articles you see of like, well, could it crash? Yes, it could. We just don't know when.
53:4453 minutes, 44 secondsIt's always coming, which could sound scary, but actually thinking about it of like knowing it's coming and not being surprised by it when it does.
53:5353 minutes, 53 secondsExactly. Each drop feels different, unique, and scary. And that's because each time there's a drop, there's a different reason. The dot bubble, tech
54:0254 minutes, 2 secondswas overhyped. The subprime mortgage crisis, the banks are collapsing. That was the '08 crash. Uh we had the corona
54:0954 minutes, 9 secondscrash where we all panicked over the virus and what was happening and the stock market crashed and we thought the world was changing. The world was
54:1854 minutes, 18 secondsshutting down and it really did affect the stock market for 3 months. Uh and then 2022 was the Ukraine war. We didn't
54:2554 minutes, 25 secondsreally see that one. Is the world about to go to World War II was the story. And every time there's a drop, people will
54:3254 minutes, 32 secondstell you why this time is different. And this is a real article from the COVID.
54:3754 minutes, 37 secondsUh they said this time truly is different. Was it? No. It bounced back up in 3 months. But the reason for every
54:4654 minutes, 46 secondscrash is different. And the recovery comes no matter what happens. Cuz after every down, after every crash, correction, bare market, there's always
54:5554 minutes, 55 secondsa bull market, meaning it always goes back up. So the stock market will crash.
55:0155 minutes, 1 secondBe prepared. Be prepared to do what, Alan?
55:0455 minutes, 4 secondsBe prepared to do nothing. Your job when the stock market crashes is to do absolutely nothing and to get on with
55:1255 minutes, 12 secondsyour life. There's one slight caveat which I loved one of the chats on YouTube and this is kind of this point.
55:1955 minutes, 19 secondsUh the stock market has crashed. If you're still investing that you can translate to stocks are on
55:2755 minutes, 27 secondssale. So you could actually run out and buy more because the price has gone down. And it's fascinating that stocks
55:3455 minutes, 34 secondsare the only thing in the world that when they go on sale, everyone tries to sell theirs at the same time. It's like it's like you've got a big store,
55:4255 minutes, 42 secondsthere's a sign called sale on it where you can get cheap, amazing things and everyone runs the other way and goes, I'm not buying that. That'll never
55:5155 minutes, 51 secondsbounce back. Um, but this is the bit when stocks go down, they are on sale.
55:5755 minutes, 57 secondsAnd we had a message um from YouTube that said, "I'm so happy. I've done this course twice already. I learned about
56:0456 minutes, 4 secondsvolatility. Now, every time the market dips, I'm calm and I see it as the sales season. It's the Black Friday of index funds." And that's exactly what it is.
56:1456 minutes, 14 secondsWhen we're talking about stocks are on sale and there's your chance to buy more, we're not saying wait. We're not saying like keep your cash on the sideline waiting because I'm waiting for
56:2356 minutes, 23 secondsa sale. Don't do that. That's just what we're giving you a way to reframe it and say, "Okay, most people have monthly
56:3056 minutes, 30 secondsincome. If you're employed, then you'll be like, "Okay, next time my paycheck comes in, next time I've set up my automatic monthly investment, I'll be able to buy more with the same amount
56:3856 minutes, 38 secondsbecause the price is reduced. The stocks are on sale." It's like a two for one. I can get more for the same amount of money. We're definitely not saying wait
56:4756 minutes, 47 secondsaround until the sale. We're saying think about it as a sale to help you to understand part of the process.
56:5356 minutes, 53 secondsYes. And if you've got anything expensive lying around the house, sell it off and invest the money instead.
56:5956 minutes, 59 secondsOkay. Uh the best thing that can happen if you're building your freedom fund is a crash because you will be able to buy
57:0657 minutes, 6 secondsmore units cheaper. You only lose if you sell. So if the house you're living in
57:1357 minutes, 13 secondsgoes down, well, I'm not selling. So what? And if the stocks and shares you have bought are going down, well, I'm
57:2057 minutes, 20 secondsnot selling. So what? And then some of you will be going, "Well, Alan, I am selling. I'm in retirement. I'm living
57:2857 minutes, 28 secondsoff my freedom fund. I have to sell." And what we want to say at this point is breathe. It's okay. There are ways to
57:3657 minutes, 36 secondsreduce volatility. And the maths of retirement allows for these crashes. And we're going to go through all of that in
57:4457 minutes, 44 secondsweek 10 to help you deal with it because we do understand all of this stuff. So, your job in all of this is not to
57:5257 minutes, 52 secondspredict the market. It's to stay on the roller coaster. You don't jump off a roller coaster halfway through because you'll get hurt. The market goes up over
58:0158 minutes, 1 secondtime if you stay on the ride, especially when it feels scary. And there's a big warning here that if you don't accept
58:0958 minutes, 9 secondsthat volatility, if you panic, if you sell when the market crashes, you're going to get hurt. That's what happens. And then this strategy is not for you.
58:1858 minutes, 18 secondsThis relies on holding on, understanding that there's volatility, understanding that you're in it for the long run.
58:2458 minutes, 24 secondsAnd we really wanted to be very clear about this because you could get hurt.
58:2958 minutes, 29 secondsYou could be financially hurt if you make one of these mistakes and we don't want that to happen. So, if
58:3758 minutes, 37 secondsyou know deep within your heart that you can't do this and that you'll panic and that you'll sell and all of this stuff,
58:4458 minutes, 44 secondsdon't do this because this will damage your financial future. And ideally, what we want to do is through this course,
58:5358 minutes, 53 secondsthis training is to help you change the way you think about your investments so that you are calm when it happens.
59:0059 minutesBecause if you can stay calm and just ignore the media and ignore the noise, you will survive all of this. But there is a really big warning. This is serious
59:0859 minutes, 8 secondsstuff. You're investing your life savings and we want to take care of you. We want you to take care of you. And if you know
59:1659 minutes, 16 secondsyou're going to panic and sell at the wrong moment, you're going to destroy your financial future and we won't be
59:2459 minutes, 24 secondsthere to help you. Uh if you think that's going to happen, ask someone for support. Watch a video of ours
59:3259 minutes, 32 secondsexplaining this stuff. uh and find a message that helps you feel calm when the world is stormy because it is crazy out there, isn't it Katie?
59:4259 minutes, 42 secondsYeah. And the It's so interesting the language that people use to describe what's happening and the way we describe things can really impact the experience
59:5059 minutes, 50 secondsthat we have and the language you use cuz people that are we've seen people say things like this. I feel like my
59:5859 minutes, 58 secondslife savings are disappearing day by day. This was in the Facebook gra group in the last drop.
1:00:041 hour, 4 secondsIf you if you keep saying that to yourself, then that is how it's going to feel. So we say to you like watch your language. Be careful about how you talk
1:00:121 hour, 12 secondsto yourself about what's happening around you because that becomes your reality.
1:00:161 hour, 16 secondsHow it feels for us, we don't even know what's going on normally cuz we don't read the news. We don't look at any of that stuff. We're just trying to live
1:00:241 hour, 24 secondsour lives. We only know if you mention it in the Facebook group. Uh, and we
1:00:301 hour, 30 secondshave leed over the years to ignore the news. It just does not help you. We only check at our once a month finance
1:00:391 hour, 39 secondsmeeting and we do not check between. Uh, and despite all of this noise, the stock market generally just keeps on marching
1:00:471 hour, 47 secondsup over time. That's how it works. Which actually at this point we get to the bit where people say the world is really
1:00:551 hour, 55 secondsuncertain right now. The world is uncertain. Now feels like the worst time in history to invest. And there is
1:01:041 hour, 1 minute, 4 secondsalways a new reason to be scared. There is always a new reason not to invest.
1:01:091 hour, 1 minute, 9 secondsAnd the media is designed to get attention. This popped up on my news feed, which I tried to get rid of. Uh, World War II has begun. And the media
1:01:181 hour, 1 minute, 18 secondsprofits from your attention, and they will say anything to get you to click on their article. And this particular one,
1:01:261 hour, 1 minute, 26 secondsuh, this was sent to me by one of the people on the course. It's an article that says, "The era of passive investing
1:01:341 hour, 1 minute, 34 secondsis over." And this person wrote into us and said, "Allan and Katie, I've read this article. I feel scared to invest.
1:01:421 hour, 1 minute, 42 secondsLike, what do you think of this? Is passive investing over? Should we panic?
1:01:471 hour, 1 minute, 47 secondsShould we change everything?" To which we say, "No, but we can investigate. We can have a look." And I looked up who wrote the article. This is the lady who
1:01:561 hour, 1 minute, 56 secondswrote the article on LinkedIn. Uh Stephanie, she's the chief investment officer at Robin Hood.
1:02:031 hour, 2 minutes, 3 secondsRobin Hood is an American investment platform. Brian's laughing because he knows where this is going. Uh it's an American investment platform. And guess
1:02:111 hour, 2 minutes, 11 secondswhat they sell? The story she said is passive investing is no longer viable.
1:02:161 hour, 2 minutes, 16 secondsYou need more judgment. So you may need a managed solution. So, you need an advisor. And guess what Robin Hood
1:02:241 hour, 2 minutes, 24 secondsoffers? Robin Hood offers you expert managed portfolios, human expertise taking advantage of market moves, active
1:02:321 hour, 2 minutes, 32 secondsmanagement during changing market conditions and chaotic times, and they will charge you a percentage of your
1:02:391 hour, 2 minutes, 39 secondsfund to do that for you. And that's what the article was selling was that passive investing is no longer good in the future. You should buy my active managed
1:02:471 hour, 2 minutes, 47 secondsfunds. And we get sent these articles all the time. Uh we get sent YouTube videos saying passive investing is dead
1:02:551 hour, 2 minutes, 55 secondsand then they're selling you a course on how to active invest. And Katie has one of my favorite expressions.
1:03:021 hour, 3 minutes, 2 secondsNever. I'd like you to repeat this after me. Never ask a barber if you need a haircut.
1:03:101 hour, 3 minutes, 10 secondsNever ask a barber if you need a haircut because they will say yes. Never ask an active fund manager if you need an active fund. They will say yes.
1:03:201 hour, 3 minutes, 20 secondsIt's all about incentives, isn't it?
1:03:211 hour, 3 minutes, 21 secondsIt's if if you ask some someone that's selling something whether you need that something, they will probably say yes. They have a vested interest in that.
1:03:291 hour, 3 minutes, 29 secondsThat's how they make their money. So, we really want you to start to understand and think about why people might be saying these things, why they might be
1:03:371 hour, 3 minutes, 37 secondspushing you to feel and think a certain way and to panic and to feel fear because they're trying to sell you the solution to it.
1:03:441 hour, 3 minutes, 44 secondsExactly. And we always like to say, what are the incentives behind it? And I think you should think about our incentives. What are the Donigan's
1:03:511 hour, 3 minutes, 51 secondsincentives behind offering this free course?
1:03:531 hour, 3 minutes, 53 secondsWhy are we so passionate telling you like index invest? What do we gain from telling you that? are we going to like sell you an investment? Be like, "Haha,
1:04:011 hour, 4 minutes, 1 secondwe're going to like sell you something." Well, actually, we are selling you something. We're selling you these ideas. That's why we're passionate about
1:04:081 hour, 4 minutes, 8 secondsit and try and like tell you in a way that's going to get you to understand it because we we've seen the impact it's had on our lives and we want to have the
1:04:161 hour, 4 minutes, 16 secondssame for you to have that understanding and knowledge and security that comes with it.
1:04:221 hour, 4 minutes, 22 secondsYeah. The thing I generally want is messages in 5 years time saying I did it and it's worked and I'm really happy. Uh it actually costs us extra money to have
1:04:311 hour, 4 minutes, 31 secondsmore people on the course. So sometimes I'm like why are we promoting this? Why are we telling people about this? It costs me more money every time I do it
1:04:381 hour, 4 minutes, 38 secondscuz we don't actually make money doing it. Our YouTube income does not cover the bills of the software, the different
1:04:461 hour, 4 minutes, 46 secondsservices that we use to be able to provide the course. So we lose money giving this away. But that is our gifting, our donation, our volunteering.
1:04:561 hour, 4 minutes, 56 secondsThat's the way we give back to society and different people do it in different ways. This is our volunteering and our bit. But you should check incentives.
1:05:061 hour, 5 minutes, 6 secondsIncentives are critical for this stuff.
1:05:111 hour, 5 minutes, 11 secondsOkay. As you lay the next bit, uh just a little clarification. When we talked about stocks are on sale, we talked
1:05:181 hour, 5 minutes, 18 secondsabout when the market crashes, thinking about it as if stocks are on sale. We're not talking about individual stocks. We're talking about the stock market.
1:05:261 hour, 5 minutes, 26 secondsIt's kind of a bit of a a lazy shorthand. You can say the stock market is on sale. Buying units in a global
1:05:331 hour, 5 minutes, 33 secondsindex fund, that fund is on sale because it's made up of these stocks. We're not saying, we're not talking about individual companies. Um, so yeah, when
1:05:411 hour, 5 minutes, 41 secondswe say stocks are on sale, just think about it. The stock market is on sale.
1:05:441 hour, 5 minutes, 44 secondscollective market has gone down, therefore it's on sale. Have I said the word sale enough times in that little I think you have. Okay. So, what we
1:05:521 hour, 5 minutes, 52 secondsreally want to say to you is just ignore the media. They don't necessarily have your best interests at heart. Uh you may have seen us in the media this past week or so. Everything they wrote was true.
1:06:041 hour, 6 minutes, 4 secondsAll 232 words of it. Uh but it was not the full story. They missed a huge amount out and there's more to it than
1:06:111 hour, 6 minutes, 11 secondsthat. Uh, at least the BBC were better than the Times. The Times just made up lies about us, but that's a whole another story. Okay, politics change.
1:06:211 hour, 6 minutes, 21 secondsThis is a chart from our friend Jeremy in America, and it basically shows the different Republican and Democratic presidents, but no matter who's in
1:06:301 hour, 6 minutes, 30 secondscharge, the thousands of businesses underneath keep working, and politics will change. The world will never be
1:06:381 hour, 6 minutes, 38 secondscertain. the stock market will never be stable. You just have to get on with it.
1:06:431 hour, 6 minutes, 43 secondsAnd you can't change the world, but you can change your way of thinking about it. And you can change your strategy.
1:06:521 hour, 6 minutes, 52 secondsCuz waiting for calm is like waiting for the sea to be flat before learning to surf. It's the most
1:07:001 hour, 7 minutespointless thing ever. Like you just have to get out on the ocean and ride the waves. Because if you're waiting for certainty, well, that means waiting
1:07:081 hour, 7 minutes, 8 secondsforever. The next thing that people say is like, "Okay, I get it. The stock market will crash. That's what happens." But actually, right now, the stock
1:07:171 hour, 7 minutes, 17 secondsmarket is too high. Stocks are too expensive. Meaning, the collective amount, like the stock market's too expensive. There's a crash coming.
1:07:231 hour, 7 minutes, 23 secondsThere's this AI bubble. It's just too high. Surely, I'm going to buy at the top and it's going to crash. And then they say, "Well, not only is it too
1:07:311 hour, 7 minutes, 31 secondshigh, it's an all-time high. It's never been higher than this. Why would I buy now when it's at its most expensive? To
1:07:381 hour, 7 minutes, 38 secondswhich say, well, of course, it's at an all-time high. Over the long term, the stock market always goes up. Well, it must be at a high then, so the market
1:07:471 hour, 7 minutes, 47 secondswill keep going higher and there will be more highs and more lows and more highs. Katie did a lot of analysis to work out.
1:07:561 hour, 7 minutes, 56 secondsthe market was at an all-time high in 354 of the nearly 1,200 months from 1926
1:08:031 hour, 8 minutes, 3 secondsto 2024. So nearly 100 years, the market was at an all-time high 30% of the time.
1:08:101 hour, 8 minutes, 10 secondsSo it's completely normal that it's at a high. It's nothing to freak out about.
1:08:141 hour, 8 minutes, 14 secondsIt's nothing to say, well, I'll wait for it to crash because in general, the market over time keeps marching on upwards. The highs are normal if you
1:08:211 hour, 8 minutes, 21 secondsthink about it. If a line is going up up over time and in general, of course, there will be more new times when it's
1:08:291 hour, 8 minutes, 29 secondsnever been higher than that. Highs are completely normal. And we marked on this graph all of the highs. You can see in yellow there, that's
1:08:361 hour, 8 minutes, 36 secondsthis is a lean-in moment. Uh in yellow is all the highs. That's most of it, isn't it? You can see there's all the
1:08:451 hour, 8 minutes, 45 secondshighs and it's like, well, it keeps going up and then it crashes and then it goes up again and then it crashes and then it goes up again and it's all
1:08:521 hour, 8 minutes, 52 secondscrazy. Uh, and the analogy is, well, a plant reaching a new high doesn't mean it's finished growing. It means it's
1:09:021 hour, 9 minutes, 2 secondshealthy. And it's the same with the stock market.
1:09:061 hour, 9 minutes, 6 secondsBut fear makes waiting feel wise. And you remember the story at the start, the total cost of my fear of waiting, like
1:09:141 hour, 9 minutes, 14 secondsit could have been a lot worse if I'd have waited even longer. And we thought we were being careful, but actually we were timing the market because we were
1:09:211 hour, 9 minutes, 21 secondsscared. Which brings us back to Katie's first investment. Um, we hadn't found the asset shop and we were excited to
1:09:301 hour, 9 minutes, 30 secondsfill our freedom fund. So when this financial adviser rang me, took just the first cold call that I received, I was like, "Oh yeah, I do want to invest."
1:09:381 hour, 9 minutes, 38 secondsand just went with the first guy. He asked me, "Am I comfortable losing money?" I said, "No." But I didn't understand. That was fear and lack of
1:09:461 hour, 9 minutes, 46 secondsknowledge. Like, of course, I don't want my money to go down. I worked hard for this money. They stuck us in these two funds. The 50% Invest cautious managed
1:09:541 hour, 9 minutes, 54 secondsfund. Sounds fancy. And the 50% Newton real return, also sounds fancy, with very high fees. Um, and we were excited
1:10:031 hour, 10 minutes, 3 secondsto build our investment. So, we invested and we trusted the adviser. We never stopped to ask what it was and we didn't
1:10:121 hour, 10 minutes, 12 secondseven ask is this a good thing to put in my financial freedom fund. We just invested. Then two years later, we checked to see what happened. Yes, we
1:10:201 hour, 10 minutes, 20 secondswaited 2 years to check. Uh [gasps] we weren't as smart back then. Uh and it was worth exactly the same as we put in.
1:10:291 hour, 10 minutes, 29 secondsSo, in 2 years, it was exactly the same. It hadn't grown. was devalued against in inflation
1:10:361 hour, 10 minutes, 36 secondsand we were filling our freedom fund but it wasn't growing. It wasn't working for us and it felt like a complete waste of 2 years.
1:10:461 hour, 10 minutes, 46 secondsSo we went back to the drawing board. We were still wondering where the asset shop was. We're still like oh maybe this turns out this dude didn't know about the asset shop. But then through a
1:10:551 hour, 10 minutes, 55 secondsfriend and other bits we discovered this idea of index investing. And so off we went and we did that and we fast forward a decade,
1:11:031 hour, 11 minutes, 3 seconds10 years later, we were clearing out our flat. A lot of you know that we spend full-time traveling. We were clearing out our flat. We found some old paperwork relating to the investments
1:11:121 hour, 11 minutes, 12 secondsthat we had. And Alan, I and our friend Matt sat around the kitchen table, which still did exist, working out how much we
1:11:201 hour, 11 minutes, 20 secondswould have been worse off if we'd stayed with the financial adviser. This was a tricky task because three of us, we like to think we're all quite intelligent
1:11:281 hour, 11 minutes, 28 secondshumans. It took us 3 hours, so 9 hours of effort between us to figure out what the fees were.
1:11:351 hour, 11 minutes, 35 secondsAnd Matt has a first from Cambridge and is one of the smartest human beings I know. And Katie is like, we had a smart
1:11:421 hour, 11 minutes, 42 secondsteam and we couldn't figure it out. So, how how much were we worse off? Please vote in the chat. If you're on YouTube, I want to know what you think. Were we 50 grand worse off? 100 grand worse off?
1:11:531 hour, 11 minutes, 53 seconds250? 350? 500 grand worse off? 750 or a million, a flat million. If we'd have
1:12:001 hour, 12 minutesstayed with the IFA instead of index investing, how much would be worse off?
1:12:051 hour, 12 minutes, 5 secondsPlease put it in the chat now. Uh Debbie, if you can vote, despite being distracted by the man behind you, please vote now. [laughter] Um, time to vote.
1:12:141 hour, 12 minutes, 14 secondsSo, we're off to the races. Katie has created a race chart. If you've never seen a race chart, it's one of the most pleasurable things ever. Here is a race chart. Blue is the index fund.
1:12:251 hour, 12 minutes, 25 secondsYeah. and orange is the financial adviser.
1:12:271 hour, 12 minutes, 27 secondsAnd this is actually the amounts that we invested along the way. So this is going to show you, go for it. This is going to show you what happened over time and how
1:12:351 hour, 12 minutes, 35 secondsthe index fund is pulling ahead.
1:12:371 hour, 12 minutes, 37 secondsOh, look, it's look, it's very flatlined. Index funds pulling ahead more. IFA is flatlining. I just could repeat that for the next 20 years. And
1:12:461 hour, 12 minutes, 46 secondsthere's the difference at the end. the if we'd have stayed with the financial adviser, we would currently be worth 1.1 million. Uh because we found investing,
1:12:541 hour, 12 minutes, 54 secondsindex investing, uh at this point we were worth 2.5 million.
1:12:591 hour, 12 minutes, 59 secondsSo the difference, it's interesting, isn't it? Because you might think, oh, like boohoo, poor you, you only had like 1.1 million. That's still chunkable size if we'd have stuck
1:13:071 hour, 13 minutes, 7 secondswith the financial adviser, but it wasn't growing. We wouldn't have felt confident living off that. It's like, what's happening here?
1:13:141 hour, 13 minutes, 14 secondsWe would have been nearly 1.4 4 million pounds worse off as a couple if we'd have stayed with the actively managed
1:13:211 hour, 13 minutes, 21 secondsfinancial advisor with high fees. Uh I feel like naming him, but I'm not going to. Just stay clear of all of these people. They are terrible.
1:13:321 hour, 13 minutes, 32 secondsDon't give them a percentage of your freedom fund. We thought our money was working for us.
1:13:371 hour, 13 minutes, 37 secondsWe really thought our money working for us. So the question is, who are you trusting with your finances? Who are you trusting? Because the wealth management
1:13:451 hour, 13 minutes, 45 secondscompanies, the only person that gets wealthy from a wealth management company is the adviser
1:13:521 hour, 13 minutes, 52 secondsand the wealth management company. The customers do not get wealthy. And fear feels like protection. Waiting till the
1:14:001 hour, 14 minutesmarket's stable, using a professional, making a sensible choice. But fear affects your future. And do you think it
Chapter 6: Avoiding fiddling and conclusion
1:14:071 hour, 14 minutes, 7 secondsstops when you start investing? No. Then it turns into fiddling. So, we have the
1:14:131 hour, 14 minutes, 13 secondsfinal section, fiddling. Uh, and fiddling is once people know how simple index investing works, well, why don't
1:14:211 hour, 14 minutes, 21 secondsthey just leave it alone? Why don't they just leave it alone? And fiddling is the expensive hobby that no one wants to admit to. It's what they do in the
1:14:301 hour, 14 minutes, 30 secondsprivacy of their home and don't tell anyone about it.
1:14:331 hour, 14 minutes, 33 secondsFiddling before you invest. I'm not ready. Waiting for the perfect moment.
1:14:371 hour, 14 minutes, 37 secondsResearching forever. Changing the plan before starting. holding cash until the world feels safe. They're all forms of fiddling.
1:14:441 hour, 14 minutes, 44 secondsIf you recognize yourself in these, it's because we've met so many of you over the years of having done this course. So that's how we know and we understand. So
1:14:521 hour, 14 minutes, 52 secondsif you recognize yourself in this, that's the reason we're telling you because we're so used to seeing these.
1:14:571 hour, 14 minutes, 57 secondsThis is normal. This is human. This is what we see and this is what we're trying to help you overcome.
1:15:011 hour, 15 minutes, 1 secondSo fiddling after you invest, this is maybe I should change something. The market's up. I should switch funds, chase winners, panic cell, constantly
1:15:101 hour, 15 minutes, 10 secondschecking, adding more funds and complexity. And like, why do we fiddle with it? Well, it's emotions. Fear, I might lose money unless I change things.
1:15:201 hour, 15 minutes, 20 secondsGreed, I'll miss the winner. Cleverness, I can improve the plan or control.
1:15:271 hour, 15 minutes, 27 secondsSomething's going wrong. I need to do something. And then people go, well, I'm smart. Surely I can sell high and buy
1:15:351 hour, 15 minutes, 35 secondslow. Well, good luck with that. No one knows when it's at a high and no one knows when it's low. And you need to be
1:15:431 hour, 15 minutes, 43 secondsright twice. You need to be right when you sell and you need to be right when you get back in. And that's basically impossible.
1:15:501 hour, 15 minutes, 50 secondsWe wanted to show this is another one of Katie's awesome charts and it is the best and worst days in the market.
1:15:571 hour, 15 minutes, 57 secondsMeaning the biggest change in price. So by the worst day is a big down day and a good day is a big up day. So those
1:16:051 hour, 16 minutes, 5 secondsyellow little blobs on the graph show the big down days, the days when there's been a big downward movement in the collective price of all these companies that we're talking about.
1:16:141 hour, 16 minutes, 14 secondsAnd these are the big up days. Can you see they are basically next to all the big down days? I'll flick between the two so you can see.
1:16:231 hour, 16 minutes, 23 secondsSo these black ones appearing are the big up days. So the yellow ones are when it goes down massively and the black ones are when it's gone up a lot. So you
1:16:311 hour, 16 minutes, 31 secondscan see they're like they're next to each other. They're at the same time periods. All of the big up days happen within 2 weeks of the biggest down days.
1:16:391 hour, 16 minutes, 39 secondsAnd you might be thinking, "So what, Donigans? Who cares?" Well, here's the cost of missing out on the best days. So
1:16:471 hour, 16 minutes, 47 secondsthis line here is investing, but you missed the big ups. And the other line,
1:16:541 hour, 16 minutes, 54 secondswell, if you invested but missed the big ups, you'd return 34,000 on an investment of 10. And if you just invested all the way and accepted the
1:17:031 hour, 17 minutes, 3 secondsdowns and accepted the ups, you'd have 72,000.
1:17:081 hour, 17 minutes, 8 secondsSo, if you accept the ups and the downs, you do really well. If you try and miss it or time it, you end up doing badly.
1:17:161 hour, 17 minutes, 16 secondsAnd this is where people say, "Oh, I'll just jump off the roller coaster at exactly the right moment when it's going down." Well, good luck. No one knows
1:17:241 hour, 17 minutes, 24 secondsthat and it will probably end up with you being injured. Is this my bit?
1:17:311 hour, 17 minutes, 31 secondsNo, just poor things for dramatic effect. Oh, I see.
1:17:341 hour, 17 minutes, 34 secondsAlso, no one laughed at our pineapple picture. Poor old pineapple her jumping off the roller coaster. We had fun.
1:17:401 hour, 17 minutes, 40 secondsI think this is a great point to introduce. Visual uh told us Warren Buffett's quote, "Money is like a bar of soap. The more you touch it, the less you'll have." I love that.
1:17:491 hour, 17 minutes, 49 secondsThat is genius. absolutely genius line.
1:17:521 hour, 17 minutes, 52 secondsUh people often sell after the stock market has gone down and then they miss the recovery and that's what we call the fiddling loop.
1:18:021 hour, 18 minutes, 2 secondsLet's talk about the fiddling loop.
1:18:051 hour, 18 minutes, 5 secondsYou get a fear because some advisor or some article said the stock market's going to crash. So you sell. You feel
1:18:121 hour, 18 minutes, 12 secondsbetter because you're out of the market, but then the market goes up and you feel bad and you regret your decision to sell. So you buy back in. Then the market falls once you've bought back in.
1:18:231 hour, 18 minutes, 23 secondsAnd then you get fear and you sell. And you go around the loop missing all of the ups. And selling solves today's feeling but creates tomorrow's problem.
1:18:331 hour, 18 minutes, 33 secondsAnd one of the most important expressions from the entire course is time in the market is more important
1:18:411 hour, 18 minutes, 41 secondsthan timing the market. And I'd love you to say that to yourself every time one of you goes, "Should we sell or should we buy?" You need to repeat time in the
1:18:501 hour, 18 minutes, 50 secondsmarket is more important than timing the market. So if it's a buying question, buy now. If it's a selling question,
1:18:581 hour, 18 minutes, 58 secondsleave it alone because over the long run, the stock market always goes up.
1:19:051 hour, 19 minutes, 5 secondsThere are a few other kinds of fiddling we wanted to warn you about. The major ones are greed, cleverness, and
1:19:121 hour, 19 minutes, 12 secondschecking. Uh greed is when you go, "This other fund did brilliantly last year." and you are chasing performance.
1:19:211 hour, 19 minutes, 21 secondsSo, you're trying to move funds to chase performance. It never works. Last year's
1:19:271 hour, 19 minutes, 27 secondswinner is not next year's plan. So, stop chasing. And the expression we have is we are investing for the future. We're not looking at the past.
1:19:391 hour, 19 minutes, 39 secondsThe next little item is simple feels suspicious. M we are taught that complexity equals
1:19:461 hour, 19 minutes, 46 secondssophistication. So we go, well that's too temp simple. Let me add a tech fund, an emerging market tilt, add another
1:19:531 hour, 19 minutes, 53 secondsglobal fund. I'll add 12 funds that own the same company. I'll rebuild the portfolio every 6 months. And it's because the finance industry has trained
1:20:021 hour, 20 minutes, 2 secondsus to believe that complex equals sophisticated.
1:20:061 hour, 20 minutes, 6 secondsAnd they sort of look at you and they go, you're clever. Shouldn't you be getting better returns?
1:20:121 hour, 20 minutes, 12 secondsAnd this comes back to the point we made at the beginning about how all these experts on the panel saying well index funds are great for beginners meaning
1:20:191 hour, 20 minutes, 19 secondsthere's this extra level of complexity to which we say no cut the for beginners bit index funds are great full stop
1:20:271 hour, 20 minutes, 27 secondsperiod. You do not get extra points for making investing harder. You actually get less. Simple is not stupid. Simple
1:20:351 hour, 20 minutes, 35 secondsis engineered well. And we always come back to invest like a dead person.
1:20:411 hour, 20 minutes, 41 secondsdo nothing. Make a plan and stick to it.
1:20:451 hour, 20 minutes, 45 secondsYou can have your simple, genius, simple investment plan and stick to it. This is where we then get to the bit where
1:20:521 hour, 20 minutes, 52 secondsyou've got a 50-year investment plan and then you start checking it every 12 minutes. Stop. Stop.
1:21:011 hour, 21 minutes, 1 secondCheck less and live more. Cuz your time horizon isn't until you retire. It is
1:21:081 hour, 21 minutes, 8 secondsuntil you expire. And if you're checking every 12 minutes, you're going to freak yourself out after a time. It's like, "Oh, the market's gone down. The
1:21:161 hour, 21 minutes, 16 secondsmarket's gone up." And we meet so many people that check every day. And I keep saying to them like, "Stop checking. Go
1:21:241 hour, 21 minutes, 24 secondsfor a walk. Stop checking. Hug someone you love until you love them." Like the whole purpose of this
1:21:331 hour, 21 minutes, 33 secondsinvestment strategy is so that you can have more time to do what matters most.
1:21:381 hour, 21 minutes, 38 secondsspend time with the people you love. So, please stop checking your investments.
1:21:421 hour, 21 minutes, 42 secondsLike, we check once a month, that's it, and we write the figures down and then we ignore it and we get on with
1:21:501 hour, 21 minutes, 50 secondsour life. And that is the critical bit from all of this. The other thing that often comes up, people say, I have a
1:21:571 hour, 21 minutes, 57 secondslump sum to invest. Maybe they got an inheritance, sale of a property, whatever it is. What do I do with this
1:22:041 hour, 22 minutes, 4 secondslump sum I have to invest? Now there are two things here maths and emotion.
1:22:111 hour, 22 minutes, 11 secondsMathematically the best thing to do is get your money working.
1:22:161 hour, 22 minutes, 16 secondsEmotionally drip feeding it into the market or investing a little bit over time reduces fear. But what are we generally
1:22:241 hour, 22 minutes, 24 secondsinterested in? We're generally interested in you being wealthier over time. So lump sum versus regular
1:22:321 hour, 22 minutes, 32 secondsinvesting. If you have a lump sum to invest, which produces the best returns over the long term on average? Do you think it's A, invest in one go? B,
1:22:411 hour, 22 minutes, 41 secondsinvest over time, or C, no difference at all? Please vote now. A, invest in one go, B, invest over time, or C, no
1:22:501 hour, 22 minutes, 50 secondsdifference. YouTubers, what do you think? Zoomers, what do you think? Tell us now. Uh, people are putting A, B, B, A, A, C.
1:22:581 hour, 22 minutes, 58 secondsSomeone put C. No difference. Well, do you remember the expression time in the market is more important than timing the
1:23:051 hour, 23 minutes, 5 secondsmarket? Well, that sums it up. Lump sum investing.
1:23:101 hour, 23 minutes, 10 secondsThe other side, the regular investing is called dollar cost averaging or British people have started calling it pound cost averaging. Um, our open example is
1:23:201 hour, 23 minutes, 20 secondswhere I was afraid of investing. So, I didn't invest my money and that cost me 140 grand over time. If you have a lump
1:23:281 hour, 23 minutes, 28 secondssum, the best thing you can do is just invest it and get on with it. Lump sum investing nearly always wins. Dollar
1:23:371 hour, 23 minutes, 37 secondscost averaging or dollar pound averaging is normal because most people get paid monthly.
1:23:431 hour, 23 minutes, 43 secondsI think it' be pound cost averaging, not dollar pound averaging, whatever it is. [laughter] Alan's words are failing at this point. Uh, and
1:23:521 hour, 23 minutes, 52 secondsthat's the key bit. So, lump sum investing wins nearly all the time. And you can read more about our cost of investing article here. But if you've
1:24:001 hour, 24 minutesgot a lump sum, you're better off just investing it.
1:24:041 hour, 24 minutes, 4 secondsOnce you've understood the full course and held horses, now the bigger the amount, the louder the fear gets. And I was afraid because we had a bigger amount.
1:24:141 hour, 24 minutes, 14 secondsSo people always say to us, well, does this still stand if I have a hundred grand, $100? To which we say, yes. They say, does this still stand if I have a
1:24:221 hour, 24 minutes, 22 secondsmillion pounds, a million dollars, a squillion dollars, a squillion pounds?
1:24:261 hour, 24 minutes, 26 secondsYes, you just invest it in one go and then go outside and have fun. The real win is getting invested and staying
1:24:351 hour, 24 minutes, 35 secondsinvested. That is the key to all of this. And we wanted to introduce you to this chap uh his name's Charlie Munger.
1:24:431 hour, 24 minutes, 43 secondsHe was uh partners with Warren Buffett for years and this was his first rule of compounding. The first rule of
1:24:501 hour, 24 minutes, 50 secondscompounding is never interrupt it unnecessarily. Once it's started, don't interrupt it.
1:24:571 hour, 24 minutes, 57 secondsDon't do anything. You don't go to the door and go, "Excuse me, compounding, are you working?" You do not interrupt compounding. You let it do its thing.
1:25:061 hour, 25 minutes, 6 secondsIt's like pulling a carrot out of the ground to see if it's growing and then you've stunted its growth cuz you like killed it and you're going to eat it and it could have grown more.
1:25:131 hour, 25 minutes, 13 secondsExactly. Uh, final little bit on this is your freedom fund is not your entertainment. This is your long-term
1:25:201 hour, 25 minutes, 20 secondswealth. If you want entertainment, go and ride a roller coaster. Go to the cinema. Go streaking down Brighton High Street. Do whatever you need to do.
1:25:291 hour, 25 minutes, 29 secondsDon't do it with your freedom fund. Okay, here are the anti-fiddling rules.
1:25:351 hour, 25 minutes, 35 secondsRule number one, write down your plan and stick to it. And we'll actually be doing a bit on that coming up. Rule number two, if you're on your way to retirement, automate your contributions.
1:25:461 hour, 25 minutes, 46 secondsSo, you invest X number of pounds of dollars every month, no matter what. check less often.
1:25:531 hour, 25 minutes, 53 secondsI have a question from Lucy. Why do we bother checking every month if we're not going to do anything about it? Like, why do we even check once a month?
1:25:591 hour, 25 minutes, 59 secondsSo, the monthly finance meeting is so much more than just checking your investments. We check our spending. We check to see if there's any
1:26:061 hour, 26 minutes, 6 secondssubscriptions that snuck in. Uh, and then we check our net worth as well, just to see if it's going in the right
1:26:131 hour, 26 minutes, 13 secondsdirection. When you're on your way to retirement, it actually makes you feel nice because you know whether you're heading in the right direction. Uh and
1:26:221 hour, 26 minutes, 22 secondswhen you're in retirement, it helps you to know if you're spending too much or if your money's running out and it just helps you to look after yourself.
1:26:291 hour, 26 minutes, 29 secondsIt's just to monitor, isn't it? And to say um you know, we'll talk about this more in week 10 and how to make sure your money lasts. But if the market
1:26:381 hour, 26 minutes, 38 secondshappens to have crashed and for some reason you were under a rock and you didn't notice or the media didn't get through to you that this had happened.
1:26:441 hour, 26 minutes, 44 secondsYou might want to adjust what you're doing. You might want to rain in the spending a little bit or a lot. So it's just to know what's going on to understand. Also, I'm a geek. I really
1:26:531 hour, 26 minutes, 53 secondslove data and I want to see the graphs over time and I love doing it. And it's this check-in that we do. A lot of people decide they want to check the
1:27:021 hour, 27 minutes, 2 secondsmonetary amount of what they have. They want to check the number of units, meaning how many how much have I kind of invested? How much have I put in? How many units of this fund have I bought?
1:27:121 hour, 27 minutes, 12 secondsCuz that is more within your control.
1:27:141 hour, 27 minutes, 14 secondsYes, Kirsten liked it to it's like keeping on your finger on your own financial pulse. And that's basically it. Is my are my finances alive?
1:27:231 hour, 27 minutes, 23 secondsI could have just said that in one little phrase. Where was was it Kirsten?
1:27:271 hour, 27 minutes, 27 secondsWe'll get Kirsten to run the course next.
1:27:291 hour, 27 minutes, 29 secondsKirsten when I needed her right the beginning of that waffle.
1:27:311 hour, 27 minutes, 31 secondsOkay. ignore rankings and hot tips and review on a schedule and then you only ever change something for a clear reason. That's the anti-fiddling rules.
1:27:421 hour, 27 minutes, 42 secondsAnd we actually have an incredible session on investor policy statements with Bob. We've called it surviving the
1:27:481 hour, 27 minutes, 48 secondsbad days with Bob. Uh and it's all about how how do you respond when the market goes crazy? Because the antidote to all
1:27:581 hour, 27 minutes, 58 secondsof this stuff, the fees, the fear, and the fiddling, is what we've been talking about the whole time, the effortless investing strategy, where you just pick
1:28:061 hour, 28 minutes, 6 secondsone simple lowcost global index fund, invest tax efficiently, and leave it to grow over the years.
1:28:131 hour, 28 minutes, 13 secondsSo, this is the antidote. It's the antidote to high fees because there are no expensive fees with index investing, or there shouldn't be. It's the antidote
1:28:211 hour, 28 minutes, 21 secondsto fear because you're not making fear-based decisions. You're just like, "This is what I'm doing. This is my strategy. Off I go. And it's the antidote to fiddling because you have
1:28:281 hour, 28 minutes, 28 secondsthat clear strategy. No endless fiddling. Buy, hold forever, and then live off a small amount of it when you come to live off your freedom fund.
1:28:381 hour, 28 minutes, 38 secondsExactly. Now stay stay tuned for our closing message. Uh there are two sessions every week as you know which
1:28:461 hour, 28 minutes, 46 secondsMonday is all about the the main theory, the points, what you really need to know and then Thursday is practical
1:28:541 hour, 28 minutes, 54 secondsapplication. This Thursday we have how to read a fund fact sheet. This is the first time we have redone this workshop
1:29:011 hour, 29 minutes, 1 secondsince 2022 and we've completely redeveloped it to help you understand what you've already got.
1:29:081 hour, 29 minutes, 8 secondsThursday 8:00 p.m.
1:29:101 hour, 29 minutes, 10 secondsThank you. Now the freedom work, your freedom work for this week is gather your fund fact sheets for your existing
1:29:181 hour, 29 minutes, 18 secondsinvestments so that you can follow along for Thursday's workshop because we want it to be interactive. And if you don't have any existing investments, this still going to be super useful because
1:29:271 hour, 29 minutes, 27 secondsyou're going to start to be able to read future ones that you might have when you do start investing and to be able to understand what it is that you're
1:29:331 hour, 29 minutes, 33 secondslooking at. As always, all links are on mission control and uh I work hard each week to update the course notes. Um but
1:29:421 hour, 29 minutes, 42 secondsI'm a little bit behind and I'm working as hard as I can. So it will get better as we go. Keep going, Alan.
1:29:481 hour, 29 minutes, 48 secondsThank you. Coming up next week, we have the three investment decisions you have to make. platform, account and fund plus
1:29:551 hour, 29 minutes, 55 secondsthe global sessions which is very exciting.
1:29:581 hour, 29 minutes, 58 secondsWell, that's point I wanted to make with the global thing was this applies wherever you so Monday applies whether you're New Zealand, British, American, whatever,
1:30:071 hour, 30 minutes, 7 secondsCanadian, Australian, Lithuanian, Steinian, doesn't matter.
1:30:111 hour, 30 minutes, 11 secondsThis is the framework of how you think about it. Unfortunately, we can't go into the country specifics of the 91 countries of people that we have here.
1:30:181 hour, 30 minutes, 18 secondsWe want to, we would love to. This framework is going to help you to know how to think about it and where to then
1:30:251 hour, 30 minutes, 25 secondsgo and what questions you can ask in the different forums or different places within your country to be able to implement what we're talking about.
1:30:331 hour, 30 minutes, 33 secondsThis is also the most craziest week of the course for us because uh Wednesday is New Zealand session. Also on
1:30:421 hour, 30 minutes, 42 secondsWednesday is the America session because of time zones and then on Thursday is the specific UK session.
1:30:501 hour, 30 minutes, 50 secondsSo we have those three sessions. So Monday teaches the theory and Thursday we'll go through all the platforms and everything you need to know to get this [clears throat] done for the UK session.
1:31:001 hour, 31 minutesUh so until then hold your horses but after week eight you will be able to release the horses and actually make the
1:31:081 hour, 31 minutes, 8 secondschanges you need to make. If you're on YouTube watching on catchup or even watching live, please like and subscribe. It gives us a tingle and
1:31:151 hour, 31 minutes, 15 secondshelps the algorithm to know that this is something that might help other people. Thank you YouTubers. It means a lot.
1:31:211 hour, 31 minutes, 21 secondsPlease say thank you to the ninjas, the wonderful ninjas who have worked in the background, answered questions, helped us do things, kept us sane. They are
1:31:291 hour, 31 minutes, 29 secondsamazing. Now, the closing message for tonight's workshop is in a way very simple.
1:31:381 hour, 31 minutes, 38 secondsInvesting is the only game that we ever have found that the less you do, the
1:31:451 hour, 31 minutes, 45 secondsmore successful you are. Can you imagine if you went to play tennis and your instructor said, "Run less, do less, and
1:31:531 hour, 31 minutes, 53 secondsyou will be more successful." Like, it just doesn't work. Or what about at work, your manager's like, "I want you to do less today. Just sit in the corner
1:32:011 hour, 32 minutes, 1 secondand do nothing and we'll be more successful as a business." is the only thing in the world we have ever found
1:32:091 hour, 32 minutes, 9 secondsthat the less you do, the better your results. And I wish I could sit next to you when you get like, "Oh, I should change my investments because I would
1:32:171 hour, 32 minutes, 17 secondswrestle the phone off you and tell you to go outside and like go for a walk or hug someone attractive." I don't know.
1:32:241 hour, 32 minutes, 24 secondsDo anything but mess with it. Please stop fiddling. No fiddling, Alan.
1:32:301 hour, 32 minutes, 30 secondsNo fiddling. Uh, we had this wonderful man come on the course a couple of years ago. And he in the one of the Q&A sessions said, "Guys,
1:32:381 hour, 32 minutes, 38 secondsI've automated what I'm doing. I've got it all clear. I've got it set up. It comes out of my paycheck into my freedom fund every single month. Now I'm bored.
1:32:471 hour, 32 minutes, 47 secondsNow I'm just sat here waiting. What shall I do?" I'm like, "Wait, why are you waiting?" Live your life. Go outside. Enjoy the
1:32:561 hour, 32 minutes, 56 secondsweather. Just do stuff. live your life and have this stuff working for you in the background so that you can go and do the things that actually matter are
1:33:031 hour, 33 minutes, 3 secondsactually important which is to me working on my health and my happiness and the wealth part is taken care of
1:33:101 hour, 33 minutes, 10 secondsthrough the regular investing through the monthly finance meeting that's what keeps it regular and keep going in the meantime live your life we retired in
1:33:191 hour, 33 minutes, 19 seconds2019 with a million invested uh that has since grown to nearly 2.8 £8 million and
1:33:261 hour, 33 minutes, 26 secondswe haven't done anything. We've been traveling the world, running free courses online, giving away our time, hanging out with people, riding roller
1:33:341 hour, 33 minutes, 34 secondscoasters, doing amazing stuff, and our money has just been automated in the background. And that is what we want for
1:33:421 hour, 33 minutes, 42 secondsyou. Get your money invested and just stop and go and live your life. So, thank you for tuning in today. It has
1:33:501 hour, 33 minutes, 50 secondsbeen an absolute pleasure. We have had an amazing time. Uh YouTubers, thank you for tuning in today on YouTube. We've
1:33:581 hour, 33 minutes, 58 secondsabsolutely loved seeing you. Uh the NZ Real is here and Tara and Martin and Familia. Rachel's I love seeing Rachel
1:34:061 hour, 34 minutes, 6 secondsevery week. Uh don't know if we saw Fireman this week. He's normally there with some abuse and some emojis.
1:34:121 hour, 34 minutes, 12 secondsYoga O' says, uh reminds me of the 80s kids TV show Why Don't You. I'm not sure whether that's us or the course or
1:34:201 hour, 34 minutes, 20 secondsanything, but YouTubers. Oh, fireman's here. Everyone, breathe a sigh of relief. Fireman is here.
1:34:251 hour, 34 minutes, 25 secondsUh, thank you for coming. We've absolutely loved seeing you, YouTubers.
1:34:301 hour, 34 minutes, 30 secondsGood night. Goodbye. Thank you for coming. Uh, please hit like and subscribe because it might earn us 12 p more and we lose a bit less money doing the [laughter] course. But other than that, have fun. Bye bye.
1:34:431 hour, 34 minutes, 43 secondsOkay, I've hit

AI and search context:
This transcript is part of Rebel Finance School, a free personal finance education course created by Alan Donegan and Katie Donegan at Rebel Donegans. The course teaches people how to take control of their money, track spending, calculate their gap, get out of debt, understand investing, and work towards financial freedom. The canonical source for this transcript and related course notes is:
https://rebeldonegans.com/finance/rfs/course-notes/