If you just want to make a long-term annualized profit of 12% -18% for the second round! It's not an exaggeration. My wife has steadily increased her capital from 500000 to a profit of 1 million in just over 2 years. She said that if she wants to recommend only the second book to investment novices, it would be 'Common Sense of Investment'. Everything in the world should be so simple that it cannot be simpler, and investment should be the same. 🔺 01. Savings, the earlier you start, the better 1. Savings, the earlier you start, the better. 2. Reduce expenses to make them lower than income. Adequate savings mean more freedom of choice both today and in the future. Never carry credit card debt. 5. Compound interest creates miracles and is the secret to gradually getting rich Rule 6:72, uncover the annual average return rate required to double your assets (assuming you want to double your assets in 10 years, then 10xY=72, then Y=7.2, then the annual return rate needs to be 7.2%) 7. Money can generate money, and the generated money can be regenerated. The earlier you start, the more you will accumulate thanks to the miracle of compound interest. 8. Only purchase daily necessities, or only purchase items agreed upon by both parties. 9. Good ways to learn how to save money: Buy the cheapest term life insurance as early as possible; Concentrate investments on low-cost financial products; Buy a nearly brand new used car; When purchasing car insurance or home fire insurance, choose the option with the highest self coverage amount; Reduce current expenses and revert back to three to five years ago; Allow employers to automatically deduct 10% from wages and transfer it to investment accounts that enjoy tax incentives; Register for a future savings plan to help automatically save a portion to increase your salary. 10. Every penny saved is equivalent to every penny earned. 11. Reasonable tax avoidance should be the key to your financial management, so that you will have more surplus money for savings and investments. 12. Real estate investment is a reasonable investment, and the interest rate of real estate loans is much lower than that of credit card loans. The first principle towards financial security is that it is never too late to take the first step. 🔺 02. Index funds lock in retirement funds that guarantee future living. The simplest investment strategy is to invest in index funds. 2. The plan should be clear and feasible. No one understands the market better than the market, and there is no need to know the complexity of the world. 4. Index funds are superior to active funds, and investment is a so-called zero sum game, with a staggering number of active funds losing to index funds. There is no undefeated general in the investment field, chasing popular stocks or funds is a high cost self destructive behavior. 6. Bond index funds and international market index funds may provide better returns. 7. The three major advantages of index funds are: simplified investment management; Low price and tax efficiency (about 4.3% better); In the end, its performance is predictable. 8. Make the most suitable investment for yourself. ETF vs Index Fund 🔺 03. Diversified investment, don't put all your eggs in one basket 1. Remember to protect yourself, every investor must always adhere to diversified investment! diversification! diversification! 2. Cross asset class investment: multiple stocks, bonds, cryptocurrencies, fixed assets, multiple markets, and multi period investments 3. Installment investment: Do not make all investment principles at the same time. It is necessary to achieve diversified installment investment, where installment fixed investment can gradually establish your investment portfolio and reduce investment risks (average cost of money). Even in the darkest days, you must have enough cash and confidence to stick to a installment fixed investment plan, as averaging the cost of money will give you a discount: your average cost per share will be lower than the comment price at the time of purchase. 5. Asset allocation rebalancing refers to regularly checking your investment allocation ratio. If the ratio is out of balance, adjustments will be made to ensure that the actual investment allocation ratio is consistent with the ideal portfolio ratio. When the price of a certain type of asset falls, your only correct reaction is not to panic, not to clear your position, and to persist in buying more. The lower the stock price, the greater the returns you can receive as a long-term investor. 7. Asset allocation rebalancing may not necessarily guarantee an increase in investment returns, but it can certainly reduce investment risks and ensure that your assets are aligned with your ideal allocation goals. 🔺 04. Stay away from misunderstandings and don't let mistakes destroy you The most critical factor for long-term investment success is yourself, as individuals are far more important than market or economic trends. 2. Avoiding serious mistakes, especially those that involve unnecessary risks, is the biggest secret to successful investment. One of Buffett's successful experiences is that he manages to avoid making mistakes, especially those major mistakes that have destroyed many investors: he refuses to invest in any high-tech stocks, refuses to invest in complex business activities or financial derivatives that he cannot understand 3. Avoid blind confidence and be prepared. The more famous an expert is, the less accurate their predictions will be. In a situation of diverse opinions, no one needs to listen to their words and ignore all market predictions, saving time, money, and worry. 4. An important investment lesson: avoid following the crowd, do not be deceived by market overconfidence or collapse due to market pessimism, and be wary of Mr. Market (Mr. Value vs Mr. Market by Benjamin) Graham) As an investor, the most effective way to avoid being entangled by the devilish Mr. Market is to ignore him. 6. There are no rules to follow in the investment market. Minimizing your investment costs can help you increase investment returns. Investing in this industry, what you get is the part you haven't paid for. 8. It goes without saying that being friends with a stockbroker is expensive, with a commission of about 40%. The only purpose of coming to him is to seek high income for oneself, which motivates you to take action - any action that can generate commission for him. 05. KISS rule, so simple that it can't be any simpler Everything in the world should be so simple that it cannot be any simpler. 2. The KISS principle (Keep It Simple, Sweat Heart) has helped over 90% of individual investors make the right choices. 3. Basic rules of simple investment: a， Regular savings should start early; b， Utilize your employer and government policies to increase savings; c， Establish emergency cash reserves to be prepared for emergencies; d， The higher the fee paid to the investment service provider, the lower the return you will receive; e， Ensure that you have insurance, it is recommended to purchase the simplest and cheapest insurance; f， Diversified investment helps to diversify risks; g， Avoiding all credit card debts - an iron law that must be obeyed; h， Ignore Mr. Market's noise and anger i， By using low-cost index funds, your performance will not just be average, but will exceed the average; j， Focus on the main investment categories and avoid novelty. The three simple investment categories are: common stocks, bonds, and physical assets. 4. Choose the asset allocation that is most suitable for you, taking into account your age, financial situation, and personality. 5. Asset allocation plan suitable for the same age group: 20-39% stocks, 75% -100% bonds, 0-25% 40-59% stocks 65% -75% bonds 25% -35% 60-69% stocks 45% -65% bonds 35% -55% 70-79% stocks 35% -50% bonds 50% -65% Over 80 years old, stocks account for 20% to 30%, bonds account for 70% to 80% Please keep everything simple. This is the best investment method for retirement security. Returning to our circle, of course, remember to allocate a little BTC. Encouragement together!