In 2009, when the world was turned upside down by the Great Recession, I started doing one thing that most people would try everything to avoid doing at the time – investing in stocks. I wanted to find an investment philosophy and methodology that a normal human being like myself could understand and follow, without fancy numbers, charts, annual reports, and all the financial jargon. I wanted to see my money grow, compound, and give me the resource I needed – financial freedom and time freedom, to achieve the things I wanted to do the most – being an entrepreneur, having fun, and leaving a legacy on earth.
It took me on a journey to discover the most simple, intuitive, and yet effective way to generate wealth, and the topic of this blog – Love Investor.
Previously, the world has taught us that the only way you can become a great investor is to get an education from Ivy League schools, then join one of the famous Wall Street banks. Somehow, these people possess the superior intelligence, the proprietary technology, and the emotional discipline to make smart trades. They can see and sense things that mortals like us can’t. That’s why they are called the Masters of the Universe.
Then, we gradually found out these people were nothing but frauds. Numerous studies came out and showed us that the vast majority (between 85% to 92%) of the Wall Street fund managers actually underperform the general market over the long term. Moreover, the Great Recession, which brought the United States and the world financial system to its knees, was caused by none other than these people. They were driven by greed, fear, and all kinds of psychological deficiencies just like everyone else, and probably worse if you consider their misguided confidence bolstered by their education and titles.
After people smelled the odor that came out of these Wall Street folks, the pendulum started to swing the other way, all the way to another deformed reality. People concluded that no one can beat the market in the long run. So instead, we should all just invest in low-cost index funds. These funds don’t aim to beat the market, but to track the market (S&P 500 for the US, MSCI for the world). They are so popular that investing only in index funds has become a badge of honor, signaling how ‘smart’ you are.
Somehow, if you dare to pick individual stocks, you are a fool. Try it, go to some of the financial subreddits and forums, and claim you buy stocks, you will be inviting thousands of self-righteous people scolding you for trying to beat the market. Why? Because “you just can’t.” That’s the logic. It’s almost as if Moses actually put the 11th commandment, “Thou Shall Only Invest in Index Funds,” on the stone, and we just found out.
Well, what if you can indeed beat the market consistently over the years? Sure, 85-92% of money managers fail to beat the market. But can you be the 8-15% who succeed? What if you not only can, but also don’t need any degrees or in-depth financial knowledge. All you need is to be you, a regular-minded person, in the world?
The S&P 500 has returned around 10% annually since its existence. That means if you invest $1,000 every month into an S&P 500 index fund starting at age 30, you will have a portfolio of $3,796,638 at age 65. That’s a great retirement plan!
But what if you can beat the market by just 5% per year? You earn 15% instead of 10% annually starting at age 30. With $1,000 per month into your portfolio, you will have accumulated $14,677,180 at age 65.
To make it simple, I have written down this rule called the 15-1,000 Investing Rule:
Investing at least $1,000/month and achieve a 15%/year long term return.
If you do this for 35 years, you will accumulate $15M.
Do you know what a $15M retirement fund would mean? It means you can do whatever the hell you want and never worry about financial problems. You want to travel around the world? You can fly first class anywhere you want and stay at the most luxurious hotels. You want to be an angel investor? Startups would flock to you for seed money. You want to donate to your church, school, and charity? Just pull out a checkbook and do it. You want to leave the money to your children and maybe ruin their lives? This is generational wealth we are talking about. You want to get naked and swim in a pool of cash? Do it, you pervert!
They all sound fantastic, but you might ask, “what if I don’t want to wait until I’m old and retired to enjoy the wealth? I want to visit Iceland with knees that still work!”
Well, this is, in fact, the most important benefit for the Love Investing Rule: the freedom and peace of mind long BEFORE your retirement.
In this world, young people are constantly bombarded by conflicting personal finance advice. For example, should you adhere to a strict budget and save every penny for retirement? Or should you not worry about money and pursue the best experience you can get while still young? As a result, we are oscillating between saving and spending, all while feeling guilty and insecure.
With the 15-1,000 Investing Rule: you can get the best of both enjoyment and financial security! The average American household makes $65,000. Even if you are young and not there yet, say you earn $40,000/year, saving and investing $1,000 per month takes work and discipline, but it’s not a task so daunting that most can’t achieve. As long as you save and invest $1,000 per month, you can do whatever you please with the rest of your income, knowing that when you retire, there will be a $15M retirement fund waiting for you.
That peace of mind means you can use the rest of your income to enjoy life, fund your own startup ideas, travel the world, support your church/charity, swim nakedly in cash, and all the good stuff, all while you are still young!
Now if you are a saving/investing maniac like me and have the growing income to support it, you can even choose to double/triple/quadruple your monthly investment amount.
Remember: Investing $1,000/month at 15%/year for 35 years = $15M
That also means:
- Investing $2,000/month at 15%/year for 35 years = $30M
- Investing $3,000/month at 15%/year for 35 years = $45M
- Investing $10,000/month at 15%/year for 35 years = $150M
Saving and investing without worrying about money is fun… a lot of fun!
Now, you might ask, “how do I earn 15%/year? If S&P 500 only average 10%/year, how can I beat it by 5%? I don’t have the Wall Street jobs and crazy computers/models. Is this something I can even dream of?”
Well, as I mentioned earlier, Wall Street jobs not only don’t guarantee higher returns, it probably means you underperform the market over the long run. However, there is a simple, intuitive, yet effective way to invest for everyday folks like you and me, without the degrees, titles, financial knowledge, and even time needed to invest to achieve market-beating results. It is the methodology I have used to achieve a 241% total return and 24% annual return for the past six years (though I don’t expect to keep the return this high in the future). It is the title and subject of this blog and my life-long passion:
Being a Love Investor doesn’t require you to be a financial genius or emotionless robot, the Warren Buffett type that most financial books and blogs glorify. In fact, Love Investing is all about tapping into your emotions: it’s about using your love for the companies whose products and services you use daily and can’t live without. You build a Love Portfolio made of these companies, then consistently invest at least $1,000/month into that portfolio.
This blog will discuss how to identify the companies in your Love Portfolio, when to buy them, and how long to hold them. The long-term goal: achieving at least 15% annual return over the long-term (35 years).
Being a Love Investor also requires two things: faith and discipline.
The stock market swings up and down without signs. For example, in March of 2020, no one could foresee that market would tank 32% due to the COVID-19 global pandemic. Yet, no one, no matter how optimistic they are, could predict that the market would not only bounce back in only five months, but finish the year up 18%, all while the country is lingering in the pandemic, social unrest, and a crazy election.
No one knows about the future for sure. But one thing we do know: we will have many, many more of these insane upswings and downswings. Looking back at history, America has survived countless recessions (even a depression), wars, and black swan events. The S&P 500 had years where it went down 39% and years where it went up 47%. Yet, over the long run, it has returned 10% annually.
As a Love Investor, you need to have the faith that over the long-term, the US economy, with its capitalistic and business-friendly structure, is going to survive and thrive, like it always has been.
You also need to have the discipline to invest at least $1,000 per month. There will be days when you are tight on money. There will be days when the news headline is scary. And there will be days when your portfolio shrinks by 10%. But no matter what, you need to have the discipline to put in $1,000 per month.
With the faith and the discipline, you, as a Love Investor, will tap into the greatest economy in the world’s history as well as compound interest, what Albert Einstein called the “eighth wonder of the world.” You will have a portfolio of Love Companies that will bring you wealth and afford you the freedom and peace of mind that the vast majority of people on earth won’t be able to enjoy. Of course, what you do with that wealth and freedom is up to you. But I hope you will use the knowledge and wealth to enrich others, so we can truly make the world a better place.
About the Author
I am Jia Jiang, husband of Tracy and father of two beautiful (with the right lighting and angle) boys. I grew up in Beijing and now live in California, which I believe to be God’s best work on earth. I am an author, speaker, and entrepreneur. Most people know me as the Rejection Guy. In 2012, when I first ventured into entrepreneurship, I started a vlog called 100 Days of Rejection to overcome my own fear of rejection. In 2015, I wrote a bestselling book called Rejection Proof. In 2016, TED published my talk: What I Learned From 100 Days of Rejection. In 2019, Toastmasters International gave me its annual Golden Gavel Award for speaking and leadership.
In late 2020, I got tired of the subject of rejection, so I started writing about another passion of mine – investing.
Over the years, Love Investing has enabled me to not only have the peace of mind that my retirement will be awesome, but also fund various ventures and opportunities life had to offer, including building a family, buying a house, starting multiple startups, and traveling around the world. In addition, it has allowed me to take chances and enjoy life to the fullest while knowing I am financially secure in the long term.
That’s why I started this blog – Love Investor, where I write about investing money and time with love, so you can all enjoy the same freedom and peace of mind.
Speaking of love, I love having fun and hate eggplants. Feel free to subscribe to my newsletter below. Or contact me at jia-at-loveinvestor.com.