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The Best Advice I Can Possibly Give About Investing

By Dr. Steve Sjuggerud
Friday, July 31, 2015

Earlier this month, I was hanging out with one of the greatest guitar players on the planet...
He has been on the cover of most major guitar magazines at some point in the last year... but he doesn't know a lot about investing. So as we were hanging out in his hotel room, just the two of us trading guitars back and forth, he eventually asked me for my investing advice.
He told me he had some savings, and he was looking for "a hot tip" to make "a quick buck." (Those were his words.) He said if I couldn't help him, maybe I could point him in the direction of someone who could.
I winced to myself... and collected my thoughts...
Here I was, hanging out with one of my heroes in music... and I had two options:
•  Did I brush off the question and get back to music?
•   Or did I give him the REAL answer... one I was sure he didn't want to hear?
I took a deep breath and gave him the REAL answer.
As I think back on it, the advice I gave him is the best advice I can possibly give to anyone starting out. Here's what I said:
•  First off, there's no such thing as "a hot tip" or "a quick buck."
•  Second, if you don't understand it, then don't buy it. Period.
You will be tempted to go against these two things. Many times.
Don't do it. The quicker you believe me on these two things, the quicker you will stop losing money and start making it.
I didn't stop there. I told this hero of mine:
•   Nobody will care more about your finances than you. How many rock stars have gone broke by handing off their money responsibilities? Don't do it! You have to captain your own ship. You can't hand that off to someone else.
•   Lastly, don't buy what's popular. Real estate was popular in 2006, for example, and many people got crushed.
I told him how I have been buying property, and how a rental property ticks all the boxes today.
Hopefully, he took my advice to heart and didn't do something stupid. I don't often talk about these four things because they're "basics" to me. But you never want to lose sight of the fundamentals.
Make sure these things are ingrained in your head... Teach them to your spouse... and ultimately to your kids.
These four things will do more for building your net worth than just about any stock recommendation I can give. Commit to them!
Good investing,

Further Reading:

As Steve said, right now is a fantastic moment to buy real estate. It's where he's putting his money right now. And he says you should, too. Get all the details here.
If real estate is one of Steve's top ideas right now, why is he sharing it? Because it's in our best interest to share our best ideas with you. Steve says this principle has turned into "far more dollars for us in the long run than if we'd simply kept our best ideas for ourselves." Learn more right here.

Market Notes


Today's chart proves that a business doesn't have to be exciting to generate huge gains in the market...
If you're a longtime reader, you know we're fans of simple businesses. We don't think you need to invest in complicated, "exciting" stocks to make money. Companies that "sell the basics" – like beer, packaged foods, consumer goods, power tools, auto parts, and cleaning supplies – often make for some of the best investments in the market. And today's stock is no different...
Reynolds American (RAI) is the second-largest tobacco company in the U.S. It sells roughly one-third of the cigarettes in the country, and its brands include Newport and Camel. It's not an exciting business... And it likely won't produce the "next big thing."
But as you can see from the following chart, Reynolds is in a steady uptrend. While the S&P 500 is up around 6% over the last year, Reynolds shares are up nearly 50%... and they just hit a new all-time high. As we often say, selling the basics isn't exciting... but it works.

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