Pearler is on a mission to educate and empower young people and first-time investors. If you're a Pearler investor, you’ll know that they're doing it with a commitment to three things: community, long-term investment, and financial literacy.
These three pillars are at the heart of everything Pearler does. And we're excited to be bringing them together in our new podcast.
This week, Pearler is co-launching The Get Rich Slow Club podcast. We'll be your hosts: Natasha Etschmann (also known as Tash Invests and Ana Kresina, Pearler's Head of Product & Community.
It's easy to think you can make a fortune overnight with all the schemes and tricks out there. Yet the truth is that investing requires patience, diligence, and a solid understanding of the fundamentals. Investing can be a way to build wealth over the long term if you're willing to learn and put in the effort.
The Get Rich Slow Club podcast gives you practical advice and information that will help you feel more confident as you start investing. Through the podcast, we share our own experiences and insights to help you achieve your financial goals.
Why invest in shares?
In the first episode after our introduction, we tackle the big question: why should anyone invest?
Ana talks about how she had saved some money but didn't know how to make it grow. Eventually, she started investing and learned about growing her wealth. Tash, on the other hand, grew up in a family that talked about money openly and knew that investing was important for financial freedom.
But, the reasons to invest go beyond wealth creation. Investing also provides freedom, travel, family time, and security for single parents. It can help you achieve important life goals like quitting toxic jobs and providing security for a young family. Ana says that people might not know they're investors if they have a superannuation fund in Australia. This is because these funds invest in shares to make the money grow.
What is compound interest?
Investing is a powerful way to build wealth thank to the compounding effect.
Tash explains how compound interest works, which she (and Albert Einstein) calls the "8th wonder of the world". Compound interest lets you earn more money with the money you already have. The sooner you start investing, the more time your money has to grow with compound interest.
Consider this choice: receive a million dollars now or have a penny that doubles in value every day for 30 days? If you chose the penny, it would actually grow to $5,368,709.12 on the 30th day. This hypothetical example shows how compound interest can turn a small amount of money into a lot over time.
In an example closer to real life, $100 a week can lead to becoming a millionaire over time. If one saves $100 a week for 40 years, they would have $208,000. However, if they invested that $100 a week with a 7% annual return, they would end up with $1,038,103. That is $830,103 more than just saving!
We both suggest using compound interest calculators to better understand these concepts. This tool will also help you decide how much to invest depending on your stage of life. As the adage goes, “the second best time is now” and that’s the same for investing.
Inflation and investing mistakes
The ups and downs of the market can be overwhelming, and mistakes are often made along the way. But don't worry - you're not alone. We've also made mistakes in our financial journeys, and we're not shy about sharing them.
Ana took most of her money out to travel, thinking she would need it. But she ended up working instead and didn't use her savings. The problem was that she didn't reinvest that money for years. So it sat in her savings, not making any money.
Her money was actually worth less over time because of inflation. It is the increase in prices and the fall in the value of money. As prices rise, what she could buy lessened over time.
Investing can be challenging for many people because of analysis paralysis. It's common to become overwhelmed by the details and spend too much time searching for the "perfect" plan.
As Tash and Ana both agree: the most important thing is to just start somewhere. Your goals may change over time. But the longer you wait to start long-term investing, the more you’ll miss out on potential returns.
A word of caution is appropriate here. Tash admitted that she lost around $5,000 during the COVID-19 crash by trying to time and bet against the market. Getting started is important, but it's also important not to get too far ahead of yourself by trying to invest in things that you don't yet understand. Everything is better in hindsight.
Listen to the Get Rich Slow Club podcast
Many people believe that investing in the stock market is too risky, and it is true that investing comes with risks. Investing in the stock market requires patience, discipline, and a long term mindset.
The goal of the Get Rich Slow Club podcast is to help you understand simple ways to invest in the sharemarket to minimise risk while maximising returns.
If you're a first-time investor looking to grow your wealth, the Get Rich Slow Club podcast is an excellent resource for you. As hosts, our aim is to provide you with all the tools you need to become a confident investor and grow your wealth in the long run.
We invite you to listen to the first episode of the podcast and join the Get Rich Slow Club. Here at the Get Rich Slow Club, we're all about community, so let us know what you think!
Happy investing,
Tash and Ana
