Why Young Investors Shouldn’t Want Stocks To Rise


Last week, I attended a teacher’s conference in Orlando, Florida.

They asked me to speak about saving and investing. Many of the teachers were young. We talked about issues faced by all young people–not just teachers.

College costs, once reasonable, are now priced through the roof. Student loans hurt. Defined benefit pensions, once robust, are melting faster than polar ice caps. Home prices, in much of the country, are completely out of reach for new homebuyers.

“At least my investments are rising,” said a young teacher at the conference.

Most young investors want to see their investments rise right away. Here’s why they shouldn’t.

Image by Pixabay

Find out why in my Assetbuilder Article

Andrew Hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School and Millionaire Expat: How To Build Wealth Living Overseas. My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions.

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14 Responses

  1. moortomas says:

    Great article

  2. Emi says:

    Hello, Andrew
    I just read you book Millionaire Teacher, and want to start to an investment.
    I found out that there are some differences between “index funds” which you mentioned in the book and “ETF”, and that confused me.
    I am 30 and never bought any investment products, do you suggest me to start with index funds or ETF?
    Thank you.

  3. Finance Solver says:

    I’m kicking myself to the curb for not having the sense to invest during the financial crisis. Granted, I was in high school and had no idea what a stock even was but that shouldn’t have been an excuse because other people have invested much younger than in high school. Now I’m sitting with the market being at all time highs, terrified that a move is going to happen that’s going to sink my portfolio. Hopefully it doesn’t happen but only time can tell!

  4. Paul Sweder says:

    Hello Andrew, Could you tell me if you know any information on efssaveinvest I just trying to find out if they are legit or not. got a opportunity to work wit them. I am in Canada.

    • toony says:

      You are the 2nd person asking about employment with this company – interesting!

      Don’t know your working background/experience but I do hope you like doing lots of cold-calling, commission based work.

      Basically, you will be hard selling extremely expensive insurance, disguised as an investment product. When people find this out…watch out!

  5. Bren says:

    Hi Andrew

    A question about investing during turbulent times. I opened a TD Direct International Account 2 years ago, and since then have been sticking to the Couch Potato scheme. However, TD has limited my ability to buy certain Index funds because of my lack of investing experience.

    For example, I can buy the XWD World Fund, but not the individual US/Rest of the world funds. So right now I have 60% of my investments in XWD. This has worked out so far, but I’m worried about how to keep diversified if there continue to be problems in Europe.

    Is having so much in a single stock, even one diversified as the XWD is, safe? I’d like to be able to buy low in Europe or the US individually, instead of the average as I am now.

  6. Hi Bren,

    It’s strange that they won’t let you buy other ETFs. I haven’t heard of that before.
    Not to worry, every time you add fresh money to XWD, you are buying European stocks as well. It’s like the perfect stock market fund, owning parts of everything. Keep buying, through “good times” and “bad.”


  7. Karl Wilcox says:

    Hi Andrew

    In Millionaire Teacher you talk about the epiphany that you had when you met the mechanic who told you about compound interest and that this is something we should be teaching every young person (forgive me if this is misquoted but I thunk that was the general gist).

    With this is mind could you give some tips for the young 18 year old investor who wants to make a start. I work with an 18 year and have told him all about your strategy using index trackers but I’m not sure how to advise him to get started. the advice you give is for expats with generally large sums to invest. This guy is maybe looking to invest £200 a quarter (UK based) so is the advice still the same: Age in Bonds and the remainder split between local tracker and world tracker? At these sums would he not lose too much in dealing fees when investing with someone like TD Direct and would they do small trades?

    As many of the people that read this site and go to your talks are teachers, it would be good to have an idea of how we could deliver what may be an invaluable lesson and strategy to our students.

    Many thanks


  8. Blake Tabian says:

    Hi Andrew!

    I first want to say thank you for all of the amazing knowledge you provided me with through your free content and amazing books. I always recommend “Millionaire Teacher” as a one-stop shop for friends/family that want to dabble into the world of investing.

    I am a 26 y/o University student in my final semester of study for Civil Engineering in Canada. I have a question that comes up regularly among my peers at university. I have a remaining student loan of $10,000 at prime + 5% (approx 7.7-8% total) but also have approximately $10,000 in the bank and a steady, well-paying job ($70k salary) upon graduation. Do you think investing the $10,000 cash I have in the bank instead of just paying down the student loan is a good idea? My thinking is that I can start accumulating the snowball with a larger sum than if starting from scratch, while making the minimum payments until the student loan is paid off.

    Blake Tabian

    • Hi Blake,

      Paying off the loan will provide you with a guaranteed, after tax return between 7% and 8%. I would do that before investing. Nobody can guarantee you a rate of return like that.


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