The Power of Starting Early:
👨👩👧👦 Why beginning an investment journey for your kids today can lead to life-changing outcomes
💰 How compound interest can turn $20 a week into more than $50,000!
Step-By-Step Guide to Getting Started (Today!):
🏦 How to open a tax efficient account
❔ What to invest in
💪 How to resist market noise and stay consistent with your long-term plan
Investing as a Family Journey:
☕ Teaching kids about investing using brands they love, like Starbucks, Tesla, or Netflix
🎮 Leveraging tools like Greenlight or Acorns Early to make investing interactive
Avoiding Common Pitfalls:
⏳ Why delayed gratification and emotional discipline are essential to investment success
🛑 Insights into avoiding “fear-and-greed” cycles that lead to poor decisions
Key Takeaways:
✅ The earlier you start, the bigger the potential
✅ Focus on teaching good habits over chasing market returns
✅ Start Small, Start Now: Even $20 per week can transform into significant savings
✅ Make Investing Relatable: Engage kids with familiar companies and accessible tools
✅ Think Long Term: Patience and consistency are more valuable than market timing
🌴 Thank you for supporting Wall Street Wildlife on Patreon! Your contributions are helping us make the show even better! 🦁
Segments:
00:00 Introduction
00:34 The Importance of Investing for Your Children
01:27 The Power of Compound Interest
04:51 Getting Started: Opening a Brokerage Account
06:00 Investment Options: UK and US
08:57 The Simplicity of Starting Small
11:06 The Importance of Consistency
14:30 Educating Your Children About Money
18:10 Teaching Through Real-Life Examples
24:58 Investing in What You Know
28:37 Developing an Investor’s Mindset
30:34 Emotional Discipline in Investing
32:07 Choosing Companies to Invest In
37:50 The Power of Consistent Investing
41:54 Encouraging the Next Generation of Investors
49:21 Practical Steps to Start Investing
E60 Investing for your Children
[00:00:00] Krzysztof: How many times have you gone in to get Starbucks coffee without thinking for a second, Oh, Starbucks coffee or Starbucks is a company that could actually help me pay for all the future Starbucks coffees I buy if I only invested in them.
It’s that simple on the level we’re talking about. Right. So that’s why I’m saying this isn’t even complicated.
[00:00:23] Luke: Welcome to Wall Street Wildlife with Luke and Krzysztof. On today’s episode, a very special topic that is incredibly important. Investing for your children.
[00:00:36] Krzysztof: The most important thing you could probably do as a parent. So let’s get to a badger.
[00:00:42] Luke: We are going to give you some really clear, actionable advice, but the real reason this is so important is starting today, not even tomorrow, starting early makes a huge, huge difference. And I’ve got some real stories to show how this [00:01:00] has made a massive difference for some of my family members.
[00:01:03] Krzysztof: Yeah, I want you to hear that again, and I want you to actually take it seriously and start today. Like right now, drop everything you’re doing, get a piece of paper and say, I’m starting today. And then listen hard with your ears, because this will make a difference of like thousands and thousands of dollars for your children’s.
being. So today
[00:01:25] Luke: And why? Because you’ve heard of this thing compound interest. It’s real. It’s like a snowball. And if you build this snowball early and you give it a kick and get it rolling down the hill today, it’s going to gather like a ton of snow. And by the time your kids get to college age, they’ll have like a really, really good headstart in life.
[00:01:46] Krzysztof: in the good news is you do not need to be a financial whiz to do this. We’re going to make the introductory steps really simple and really clear.
[00:01:55] Luke: Exactly. Our first five minutes are for everybody [00:02:00] and we’re going to give you some prescriptive, step by step, this is what you should do if you just want to get this snowball rolling for you. And we’re going to do a UK and a US version. We’re going to recommend a broker. We’re going to tell you what to buy.
We’re going to make it as simple as possible.
[00:02:16] Krzysztof: And, and we want you to know that every small contribution today will make a huge difference much later. So it might not seem like a lot to you today, but this really is the key. If you take what we’re saying today. to heart.
[00:02:34] Luke: Great stuff. And if you want to hang around after the first five minutes, we’re going to get into some more complex stuff, which is going to get you engaging like you’re investing muscles. And we’re going to share a different way of approaching this, which is more hands on. But the first five minutes is for everybody.
Set it and forget it. Come back in 18 years, 20 years time, and you’ll be shocked at the results.
[00:02:58] Krzysztof: Yeah. And I wouldn’t [00:03:00] even call what we’re going to talk about complex. It’s just that the opening stages are really, really, really simple. Anyone can and should do it. And then what we talk about later in the show is going to be more maybe interesting and basic, but still nothing here is particularly complex.
So badger, how do we get started?
[00:03:19] Luke: before we, how we get started, let’s just really land. The difference this can make Krzysztof, you put together this really nice diagram will pop up on screen. Now, just a simple example of the power of compound interest. And if you were to make just a hundred dollar investment today, and if you were just to invest 20 bucks a week, And even just getting an 8 percent market return over the next 20 years, those 20 a week, that’s going to add up to over 50, 000.
That’s pretty huge start to help with an education. To help maybe get started in [00:04:00] life, get the skills you need, maybe even to be like a seed deposit for a first house. Just going to give your kids like a lot of headroom to get life started in the right way and not be leaning on the bank of mum and dad so hard.
[00:04:12] Krzysztof: Right. I think that’s the word that many people get tripped over. They can’t believe that’s something like compounding. It feels like this abstract idea, but because 20 years is so far away, many people think, think to themselves, but it gets here way sooner than you think. And it is kind of like a magic thing that happens a little today ends up being a huge amount later.
So take our word for it. Just forget the abstraction. The main message here is. Today, you’re going to open up a brokerage account, and you’re going to drop a little bit of coin, and we’re going to help guide you on how to do that.
[00:04:50] Luke: Right, let’s do it. Let’s talk about exactly what we have to do now. I’m going to give you the UK version and then Krzysztof is going to give you the US version of each thing. But the [00:05:00] very first thing you need to do is to open a brokerage account like an investment account. For your kids, and you want to find a broker that’s nice, low cost, and you want a kind of account that in your country is tax efficient, because if you can get the compounding growing and all that money growing in a tax free way, it’s going to really magnify your gains.
So let me explain how you would do that in the UK. if you don’t have a preferred broker that you’re using already, and you don’t know anything about this stuff, I’m going to say, keep it simple. And you’re gonna go open account with a company called AJ Bell, and you can find them at U Invest, Y-O-U-I-N-V-E-S t.co.uk. And what you wanna open for your kids is something called a junior ia.
You might have heard of an isa. It’s a super fan, fantastic tax efficient investing scheme for grownups. If you’re a kid, you get the junior is aversion and you got all the same [00:06:00] tax benefits,
[00:06:00] Krzysztof: Okay, in the U. S. You’re going to go with one of the big three, and it really doesn’t matter which of these three you pick, Fidelity, Vanguard, or Schwab. Just Google either of the three, maybe some of them have slightly better perks than others, but you’re going to open up a brokerage account with one of those, and then you have two basic options.
One specific tax advantaged account called diabolically 5 to 9 after the arcane, hard to understand IRS codes of section 5 to 9. Those 5 to 9 accounts allow tax free money to be withdrawn for educational purposes. So if you’re. Thinking that junior is going to go to college in 20 years, then all the money that you withdraw from that account, if used for educational purposes, will be tax free.
So that could save tens of thousands of dollars. So that’s option one, but option two is if you don’t want. to limit them specifically to [00:07:00] education, then there’s something called a uniform gift or uniform transfer minors act account. Again, sorry for the stupid acronyms, the UGMA slash UTMA account. It’s this account allows you to be the custodian of it, and then it gets transferred to your kids when they become of age around 18 to 21.
And there are also tax benefits to opening that account. So you and your partner spouse. Should probably have a conversation. Do you want education focus or one of these more general accounts? Then you hit the big brokerages and you say, we’d like to open up one of these custodial kinds of accounts for our kids.
And then they’ll walk you through the rest.
[00:07:46] Luke: right? So. Keeping it real simple, you’ve opened the account, you’ve got your custodial account, or you’ve got your junior ISA in place and it’s, and now you need to add some money. So stick in a hundred pounds, a hundred [00:08:00] bucks, whatever you can afford just to get the journey started. And once the money’s sitting on the account, you’ve got to invest it.
So again, keeping it real simple. If you’re in the UK, the product I would recommend is you buy Something called VWRP, which is basically, it’s a Vanguard passive index ETF. I’ll explain what those words mean basically by it’s like a big collection of every company in the world, all the world’s biggest companies and lots of different countries.
And it’s, you’re investing, like you’re buying a tiny share of all of these different companies, but essentially you’re buying like the whole market. And over the very long term, and these accounts are going to be long term accounts because your kids can’t take the money out for decades. You’re going to get a nice return of historically, Between say 8 and 10 percent a year, year after year, get that compounding going.
[00:08:57] Krzysztof: I want to double down on one point [00:09:00] badger that the amount of money you start with does not matter. I know we know from experience that this poor point right here is the major stumbling block. Anybody listening to this as a parent might say. Oh, I don’t have a thousand dollars right now, but you know, maybe in a couple of months or three months and then time goes by.
And then the ship has sailed and you’ve lost this opportunity to do it today. I don’t care if it’s a 10,000 1,000 100 put 50 bucks in there, put 20 bucks in there, whatever the absolute minimum is in your brokerage to open up an account. That’s what you should do. If that’s what gets it done today, period.
[00:09:42] Luke: Couldn’t agree more, Krzysztof. So we’ve got our account in the UK. We’ve bought VWRP. What are we going to buy if we’ve got our US account?
[00:09:52] Krzysztof: Okay. If you have a us account and you have your say a hundred bucks in there, just, you know, chomping at the bit.
So the [00:10:00] stock ticker that I recommend is something called the Vanguard total stock market index. It is us centric, but it’s basically collecting all of the stocks from across the different stock markets in the U S ticker is V T I. Yeah.
[00:10:17] Luke: And that’s it. You’ve just opened a brokerage account for your kid. You’ve put some money in, you’ve bought a low cost passive index tracker, VWRP or VTI, and that money’s going to grow. Now, ideally you want to get into a good habit of adding a little bit extra money when you can afford it. Maybe this is like Christmas time or birthday times, like gifts from the grandparents or friends.
Or maybe it’s something you do, you know, once a month, maybe you give the kids some pocket money and maybe you have a bit of extra money and you put it into their brokerage account every, let’s say every quarter, or maybe even every year you go in there, maybe you’ve got their money saved up in their bank account and like their piggy bank, you transfer it over [00:11:00] to your brokerage account and you buy more of VWRP or VTI compounding.
[00:11:06] Krzysztof: Yeah. And I know that when you open up a lot of these brokerages, because it’s their business model, they try to make it as easy as possible for you to have a recurring investment going. I would click that box and I would set it immediately as you open it to the lowest amount of money that you really wouldn’t miss as a parent.
So honestly, if it’s 10 bucks a month or 10 bucks weekly, check that box. If you know you won’t miss that money, you, you, you won’t feel the effect of it, but before you know it, that money will have grown and you’ll consistently get alerts, right? And it’ll keep this thing at the top of your mind and it will make a huge difference.
So, All things being equal, start the recurring,
[00:11:49] Luke: like auto invest.
[00:11:51] Krzysztof: Start that thing. You’ll, you’ll know when you see it on the platform, auto draft, or, you know, monthly, weekly auto draft, check that [00:12:00] box.
[00:12:00] Luke: And now there’s just one tiny last, but incredibly important step to this, getting this journey started. It is do not sweat it. Just stick with the plan. Keep investing money regularly. Keep buying those low cost products and let time do its thing. And if you come back in a year’s time and maybe your money is worth less than you put in, don’t sweat it.
This is the right plan. This is a plan. This is similar to a plan I’ve adopted for a bunch of family members. I don’t have kids myself, but my cousins and my brother does, and I’m doing something like this for them. And sometimes things are down, sometimes things are up, but over the long term, this is how compounding works in the very long term, small amounts of money turn into very, very large amounts of money.
100%.
[00:12:49] Krzysztof: preach the gospel badger, it’s so clear to me that the problem many people have is they don’t believe it. Where they can’t imagine that it can [00:13:00] be this simple. So they freak themselves out. They psych themselves out and say, Oh my God, brokerages and stocks and indexes. And I don’t know anything about that nonsense.
I mean, not that the fear is nonsensical. It’s just that it can and is that simple. If you’re, this all, correct me if I’m wrong, Badger, you could start right now and have the whole process be done in less than an hour. Yeah. I mean, you, you, you Google, you find one of these brokerages, you open it up, you link your bank account, you pick one of the tickers, if you’re, that we talked about, you set it on recurring contributions. And you’re done. You might actually have amnesia and forget that you ever did this. And then 20 years from now, you know, you say, Oh, hey, remember I listened to that Wall Street wildlife shit.
I opened up an account. How much is that worth? Holy Christ. It’s 80, 000. How’d that happen? You’ll thank us in 20 years with a banana flavored [00:14:00] pina colada.
[00:14:01] Luke: It can be as simple as that. Now, if you want to drop off of today’s episode, and that’s all you took away, like that is going to be incredibly valuable. Trust me. If you want to stick around for the next half an hour or so, we’re going to go a little deeper and we’re going to tell you aspiring investor parents about actually going beyond buying a passive index tracker, maybe picking some interesting investments, maybe starting to try and have some of these conversations with your kids.
[00:14:29] Krzysztof: Yeah. And this is where my ears perk up and my tail starts spinning because I’m an educator and one of the most valuable things I think parents can offer their children is a kind of education. And I know from my own experience, the U. S. public schools did absolutely zero for me in terms of financial education.
I have to do it all myself. So if you’re the kind of parent that could actually. get involved with teaching your kids what money is and how to [00:15:00] do it, that might be worth more than their college degree in and of itself. I, I, I wish I was exaggerating, but it’s true. And so the way that. That parents can educate their kids now about investing is so much better and plentiful than it ever was even 10, 20 years ago, that we have a bunch of cool ideas for you to how you could become a better parent via financial education.
[00:15:26] Luke: And there are so many other benefits to being an investor. Like it makes you curious about the world. It makes you think about like, how do companies work and which companies, like why are companies that I know and recognize, like say Netflix or Disney or, you know, brands that you see in the high street, why are these, organization successful and why does some fail actually gets like some critical thinking going that can just be incredibly valuable to help a kid navigate the world and maybe just at a simple level make good career [00:16:00] decisions themselves.
[00:16:01] Krzysztof: Oh, absolutely. I mean, that’s one of the key reasons you and I love doing this. Week in and week out because we love learning about the world and I mean, it’s, it’s way beyond just like cents and dollars for us. Right? And remember, kids are way more curious than adults are. So you might be jaded and cynical, you know, but your, your kids aren’t.
And so getting them in this habit of, Asking questions and learning about things that beyond their school textbooks is a gift in and of itself now badger Do you mind if I go off on a little bit of a pedagogical philosophical bent? here. I’m going to try this simple. So again, I’m, I’m drawing on my career as an educator, both in high school and on the collegiate level. I think there’s a poor way of educating and the right way of educating. And the poor way [00:17:00] is what we actually default to, unfortunately, but we’re humans. And that’s by telling others, whether it’s your kids or somebody else, we, we default to telling them, okay. Here’s some facts and here’s some data and this is what you should do, right?
I mean, that’s, that’s just not great because that forces somebody into a passive position. And so the data can remain, whatever you’re talking about can remain, does remain abstract and abstract things in one ear and out the other. As an educator, the best way you approach any topic, especially a financial one, is by asking questions And by going way slower than you think you should, so that the topic that you’re talking about becomes more real. So in other words, asking questions instead of saying things at someone, and then by asking questions, You actually invoke experience, [00:18:00] actual lived world experience. So I have an example if I may on this topic. Let me think about this. So let’s imagine I have an eight year old. I don’t, but, but an eight year old is a, is a fine age in which money or the idea of money starts becoming more and more real, right? Eight, call it eight to 10, right? Kids have allowances, but the thing that’s missing for many kids is what I would call that real experience of the value of money because for them it just magically grows on trees.
So the way a good parent educates kids is not by simply say giving them 10 a month and saying, Oh, here’s this magic bean that now you get to spend it. It’s by positioning them in an experience where they could feel right. That money is a hard thing to get, and you have to treat it with care. And so you could have an invited conversation about this very topic, like, Hey son, you know, you have this allowance, but let’s get more [00:19:00] serious.
Right. Where do you think what would happen if your allowance went away? Right. Or what would it mean for you to have twice as much money? What would you do with it? Do you know where, do you know how hard your mom and dad need to work to get this money? I mean, any kind of question that invites an open conversation.
from the base level gets the child more committed and more interested in all of the, the ideas,
[00:19:30] Luke: And, and you can make this like a really investing focused conversation by literally picking a couple of good investment opportunities, picking some fantastic investment companies and having a conversation with your kid about those companies. Like how do they operate? What do they do? Products and services do they create?
So this is going to force you to become an investor. An investor before you can impart this knowledge to your kid, but it could be like a really fun journey to go on together [00:20:00] to understand why any particular company may be a good or a bad investment.
[00:20:05] Krzysztof: right? So there’s the, right. We’re, we’re for sure going to talk about picking specific individual companies a little bit later, but let me backtrack a little bit to this imagined scenario, right? Where you, you really decide you’ve decided you want to help your child invest better or start investing rather, right?
I’m picturing A question like, okay Bobby, you’re currently getting 10 from mom and pop, right? But what would it be like if you got 20 a month? Right. Would that be twice as good? Like how excited would you be? What might you wish to buy with that versus what would it mean to not buy something now and save a little bit so you could have a thousand dollars, you know, when you’re 13, what might you do with that?
But the whole point is setting up the conversation so that they could see. mentally that one money doesn’t grow on trees [00:21:00] and that there’s something they can do to make a whole lot more of it. And that’s something is called investing,
[00:21:07] Luke: I think there’s like, I don’t know that I’m not a psychologist, but there is like a study that said one of the biggest indicators of success in later life is if a kid. Can manage like delayed gratification, like even just like saving their suites, saving their pocket money, and then, you know, not just like stuffing their face whenever they get like the hands on something and spending it straight away, if they can plan ahead.
Well, that’s generally an indicator that there’s an interesting, useful life skill there. So you want to nurture that kind of mode of thinking.
[00:21:41] Krzysztof: right? And I hope I’m not repeating myself, but let me draw from an example of my own life. I remember my parents always tell me to turn off the lights when leaving a room, but when I was whatever, eight years old, Sure, I heard that, but to me, I [00:22:00] never had to pay the electricity bill. So to me, it really didn’t matter.
You know, like I can’t feel the difference between turning on the light or turning off the light because I’ve never seen an electricity bill. Right. So just telling a kid, turn off the lights or start saving. I’m on record as saying is not that effective. Much more effective is something like taking the utility bill, right?
Sending them at the kitchen counter and saying, Hey, Bobby. So you get 10 a month from mom and pop. But we want you to see how much it costs to actually have a working you know, lights and heat, and then they’ll see, Oh my God, it’s 260 a month. Right. And so that becomes more real. And that’s why I say, go slow.
Don’t skip the step of saying money, how you approach money now will make a big difference in how you think about it. Once you [00:23:00] cover this basic, like introductory phase, then you’re ready to start saying, and so, you know, we listened to this podcast with a badger and a monkey, and they’re really smart about how making a lot more money.
And we’ve learned some things. And so these are some things we now want to learn with you or do with you on this new investing journey of ours.
[00:23:24] Luke: So how deep do we want to go in this conversation, Krzysztof? Because. We have spent over 20 years each refining our skillset for picking what we believe are the world’s greatest investment opportunities. Like I’ve literally, I’ve made a career out of this now. I’m a professional investor. You spend a huge amount of your time as well as being a professional educator, managing, picking incredible investments.
And like a simple level. Like go back and listen to the last 60 episodes of this podcast, but maybe you don’t want to do that, right? But maybe click that [00:24:00] subscribe button because every week we do talk about the attributes of the world’s greatest companies. And if you go check out our Twitters like X, or if you go check us out on Patreon, like we share our actual portfolios and the things we’re invested in, we’re not saying.
These are the right things for you. Go just buy the same stocks we have, but we are trying to use this podcast to educate and give you a toolkit so you can yourself work out which are the best investments and maybe which are riskier investments, or maybe like a bit too boring investments that don’t quite align with your own investment objectives.
So we’re trying to give you the tools.
[00:24:39] Krzysztof: what got me started just started before I got into analyzing companies and doing the kind of medium complex slash advanced level stuff is by reading Peter Lynch’s one up on wall street, there was one principle in there that stuck with me and served me better than any other. which is [00:25:00] invest in what you know and like. This literally does not require any sophistication as an investor, but as though by magic, the things you know personally and like tend to be winning investments. So one very obvious example might be you’re watching movies together as a family. So you’re using Netflix. So you might say to your child, Did you know that Netflix is a company and did you know that Netflix is a company you could actually invest in and do you know what that means to invest in the company like Netflix?
And then you could have that conversation about what it stock is and that in exchange for share you get profits on and so forth. But the point being is that when finding initial companies to invest in a stock like Netflix. or a stock like Apple, you know, iPhones, all your kids are using phones, or you go out to dinner and you buy [00:26:00] Chipotle, right?
All of these companies that your kids know and like often make wonderful, wonderful investments and it does not need to be more complicated than that at the very start.
[00:26:12] Luke: And you do get a massive advantage. Like there are. Big financial organizations like banks that employ professional analysts and it’s like their job to go study, let’s say the restaurant sector. And, you know, maybe these are really rich guys and they’re actually out eating at fancy, like fine dining every day themselves.
And maybe they’re not going to like, The McDonald’s and the Chipotle’s and these other restaurants, but they’re professionals and they’re analyzing that sector and they’re looking at like grain prices and weather systems, and they’re trying to forecast what the company’s going to do. If you are actually interested in this stuff, you have a massive advantage over them because you’re there using these products, like every, like don’t eat McDonald’s every day, right?
But you’re using these products like regularly. And if [00:27:00] there’s. Like the brand changes, or it just kind of feels different. And you’re like, I’m not sure I like this anymore. Like this, this restaurant experience isn’t what I expected. Then you’re getting like a really clear signal. All of the other customers are probably getting too.
Like there’s an element of like your anecdotal experience. You’ve got to filter that a little bit, but sometimes you’re going to see something much sooner than the professionals and that can inform your investment strategy.
[00:27:29] Krzysztof: Right, absolutely. But the basic, yeah, and the basic principle here is it’s almost like windshield wiping your own eyes. How many times have you gone in to get Starbucks coffee without thinking for a second, Oh, Starbucks coffee or Starbucks is a company that could actually help me pay for all the future Starbucks coffees I buy if I only invested in them.
It’s that simple on the level we’re talking about. Right. So that’s why I’m saying this isn’t even complicated. [00:28:00] You’ve opened up your brokerage account, right? You have your recurring ads every month, and then you simply ask yourself where you have a conversation with your child, let’s say once a month.
Hey, what new products or what interesting things have you seen out there in the world? What are all your friends talking about? Oh, there’s this thing called Spotify. What’s that? Oh, Spotify is a streaming music service. Is that a company you could buy publicly? Oh, look at that. You know, and then you buy, say, a share of Spotify.
And you have your reason for thinking it’ll succeed. That’s all you need at this initial stage.
[00:28:37] Luke: And we’re, we’re, we’re caveating like at this initial stage, because actually the whole discipline of being an investor, like I don’t want to sugarcoat it, it is complicated. If you are going to go and pick individual companies, like you do have to do a bunch of work, at least to make sure the things you’re invested in are continue to be good things to be invested in.
Like the word here is the thesis. You [00:29:00] need to know why you own the companies you own. And it’s probably beyond the scope of today’s short discussion. But if you want to get into that, like click the subscribe button, because this is the stuff we talk about every week. We talk about our favorite companies.
We talk about our thesis for those companies. And sometimes the thesis breaks, something changes in the world. And we talk about why we’re selling those companies.
[00:29:22] Krzysztof: Right. I would call that getting, becoming a legitimate investor. And I think that’s. Almost like step two, right? You, you just mature and then you realize what it takes to be a good investor. But the step that I think you and I are really trying to accentuate or underscore at this stage is that it’s the, it’s.
Thinking of yourself as a beginning investors, step one, and then simply developing a habit that you think to you walk around the world and you just get in, you’re in the habit of, would this make an interesting investment? Would this make an interesting investment? [00:30:00] And you’re still in theory, not dealing with a lot of money, right?
So if you decide to invest in something like Apple or Google or Amazon or Facebook. Chipotle, right? If you’re sticking with some of these larger companies that are hundreds of billions of dollars, it doesn’t really matter. I mean, you know, many, many asterisks here, but it doesn’t really matter if your thesis is like, correct or accurate or, you know.
You don’t really need to do that much work at this initial stage of just turning yourself into an investor that regularly does this kind of thinking,
[00:30:34] Luke: Now there’s another whole world of skill sets, it probably is just worth acknowledging, but these are like hard lessons you have to just learn doing, and it’s the whole piece around emotional discipline, control, like in our first 15 minutes where we kept it real simple. The final step was like, don’t sweat the journey.
Don’t fear that stock prices go [00:31:00] up and down, you know, maybe your index is down one year, just stick with the plan. The reason most people fail as investors is because like fear or greed, their emotions take control and they end up making bad decisions. You know, everyone says, you know, buy low, sell high.
The reality is that your emotions will cause you to want to do the opposite. They’ll cause you to want to sell low and buy high. And it sounds dumb, but that is how the majority of people actually invest. And that’s why the majority of people lose money. So you’ve got to. You’ve got to build this emotional, intellectual skillset that just lets you stick with the plan.
[00:31:41] Krzysztof: right? And this is why two crazy wild animals like us will be your guides. And, you know, we’ve done this for so long that will, will in a sense help you know what the pitfalls are ahead of time. But to me at this stage, this really beginner oriented [00:32:00] framework, it’s like, how do you, how do you keep it fun?
And how do you keep it consistent at the beginning? And so my recommendation before we get into the, the call it hazards of the job is start with 10 companies. And ask yourself, what 10 companies do I actually like, right? What 10 companies in the world whose products really wow me, what 10 companies would I enjoy knowing?
I have a piece of, and forget everything else, forget the ups and downs and the, all this other stuff. What would feel good to me to feel like an owner, right? Can we do this right now? Luke, like 10 companies off the top of our head that are like, forget everything else like that would be like, if these were 10 companies, we were following their journey of that would, it would keep us like really interested and kind of committed to the process.
I’ll start, I’ll say. Tesla is a really interesting company. Wow. Maybe they’re coming out with [00:33:00] like, you know, robo taxis. I’d like to follow their journey. So there’s one company. What
[00:33:05] Luke: Tesla’s on my list. I’m going to go with a name that you probably have never heard of, but they’re a super interesting company. They’re called Intuitive Surgical. It’s the very first company I ever bought in 2006 and they make. Basically robots that do surgery. So if you’re a surgeon, instead of getting your hands like mucky inside the patient, you operate through a robot.
And it seems like science fiction, but they have such a huge decade long headstart over everybody else trying to do the same thing. And their robots are making surgical outcomes better. Like they’re making the world a better place. They’re helping us all live longer, healthier lives.
[00:33:46] Krzysztof: Yeah. And then you might be you might be someone really into gaming, right? You have young kids. What is the world’s most wonderful gaming company? Nintendo. Nintendo is a [00:34:00] company that you could own, right? You’ve probably, if you have kids, you’ve seen the Super Mario Brothers movie, right? So why not put that in the portfolio,
[00:34:09] Luke: And then look. I had three packages arrive from Amazon just like an hour before, like recording the podcast today. I live and breathe all of my retail on Amazon and you probably too, too. Amazon are this e commerce giant in almost every part of the world and they do a bunch of other really interesting stuff as well around helping other companies run their businesses.
But essentially, if you just thought about them as being like the world’s Retailer, like that’s an incredible business to own a piece of.
[00:34:42] Krzysztof: right? And, or, and, or you’re a mom and you have a daughter and you like going to yoga. Odds are you’re wearing Lululemon pants or Lululemon shirts and Lululemon everything, right? Your fashion. a sensitive teen will probably tell you, right? [00:35:00] Like what the next new fashion thing is. But if you invested in Lululemon when this was starting to become a trend, you would have a lifetime free supply of every last Lululemon article of clothing paid for by your investment.
So there’s another one.
[00:35:15] Luke: I got one, again, you may or may not have heard of them. Rocket Lab. You’ve heard of SpaceX probably, and you’ve heard of NASA, and you see like these rockets going up and getting caught and just incredible things. Like space isn’t, is no longer like Star Trek, the final frontier, it’s real. And if you look at, Who are doing the most launches?
Number one is SpaceX by an absolute ton. Number two is the US government. Number three is the Chinese government. Number four is this tiny little New Zealand company called Rocket Lab, who are successfully putting stuff into orbit. And they’re, to me, like Rocket Lab and SpaceX, these guys are like the railroads of the 1800s.
They’re building the highways [00:36:00] that virtually all commerce is going to depend on in 20, 30 years time.
[00:36:04] Krzysztof: We didn’t mention a company like Google even every, and this is one of these points, right? Some companies are so much part of our lives that we stopped even recognizing them, but there’s no human on the planet with a connection to the internet really that doesn’t know and understand Google. But what Google is doing in terms of AI and now driverless cars and like solving all kinds of problems, like I think any young person that is, you know, in elementary school or higher could probably explain the value of a company like Google to you, the parent, better than you understand it.
So why not put that in the portfolio?
[00:36:44] Luke: And like if we’re going to close this section, I guess we have to talk about like the OG investment that has been like the hot investment for the last few years. Bunch of years, NVIDIA, like if you read anything in the financial press, everybody’s going on [00:37:00] about the crazy games of NVIDIA and it has been now.
It’s been the greatest investment even in the last 20 years, but they’ve only really been a shit hot investment for the last two or three years. And why is that? Because they’re making the hardware that enables AI and AI is essentially an artificial intelligence is now powering. Every business, not just like these chat GPTs, like make me a cool picture, write me a poem like real business efficiencies across all organizations in every sector.
They’re all underpinned by ai and Nvidia pretty much has a lock on providing the hardware, designing the hardware that all this AI stuff runs on.
[00:37:46] Krzysztof: And so to peel back the curtain a little bit for you guys. One of the reasons that Badger and I do this show is because we know firsthand how valuable investing is. It changes [00:38:00] lives. And to make it more fun, we started a yearly competition called King of the Jungle, where both he and I add, we started with 100.
I’m sorry, we started with 1, 000 last November. And then every month we add a hundred dollars, and now in year two we’re adding $200 per month. We track all of these picks, real money, real portfolios in a Google sheet that we make visible on our Patreon page. So you could find us at patreon.com/. Wall Street wildlife.
And there you could see exactly the picks that we’re making in the conversations we’re having about them, including listening to the show. So that’s where you start getting into the rationalization and all the more advanced skill set. But the point is that we’ve made it fun. We’ve made it a competition.
We’ve made it consistent. We’re transparent about what we own, and we talk about all this stuff. If you get yourself involved in this game, and if [00:39:00] you get your kids thinking like this, then before you know it, they will have developed a genuine curiosity about it, and they’ll be off to the races. That’s, I think, the main message that we’re, we’re selling.
You’re not in this alone, right? Like, you’re not, all of the, all of the, like, Financial kind of like, I don’t know, sometimes from the outside, if you look at it, you see tickers and you see scrolling numbers and you see charts going up and down and you see talking heads trying to sound all fancy. It does not have to be like that.
It’s as simple as what we just said, great companies that you are interested in, that you see, you listen to our show, you understand, you start being part of the conversation, you follow what we’re doing, not blindly. because we’re not financial advisors, and this is not financial advice, but you could at least know what we’re talking about and why we’re doing what you’re doing, and you make your own decisions, but you’ve developed a habit.
[00:39:58] Luke: And it makes a massive [00:40:00] difference. Like we started this conversation talking about your kids and maybe building like a five figure investment portfolio in a tax efficient way for your kids to help them through college or to help them with like a great start in life. It can help you in life as well. I didn’t start investing until I was like in my young thirties.
And I’m now. 21 years in to that journey. Well, I, I retired from my regular nine to five job when I was 49 and now I’m a professional investor. Like now I have frankly an incredible life to having a lot of fun with this podcast and I’ve kind of won the game. Like maybe things will go wrong, who knows, but right now I’ve won the game of life and like my mission with this podcast is just to kind of share some of that knowledge because it’s not hard.
It’s not hard to get started and it’s not hard to slowly build the skills and make mistakes and we’ve made a ton of those mistakes already and we use this podcast [00:41:00] to share those and help you hopefully avoid like the big mistakes yourself.
[00:41:05] Krzysztof: Yeah, and I really hope what I’m about to say doesn’t sound arrogant or braggy, but it’s coming from sincere place. I’ve been a professional educator my whole life, and we know educators make diddly squat. I mean, that’s an understatement, right? In fact, I have a PhD. So for eight years of my life, I was literally making poverty level wages.
So I never had a professional corporate job like Luke did. Right. And yet I own my house. And I own a Tesla. And if I play my cards, right, I’m aiming to retire maybe a little bit sooner than badger. Cause I got another four years in there, right. To, to kind of maybe eek, eek out a win in that, in that sense.
But it’s entirely because I started investing when I was 17. So and, [00:42:00] and by the way, I could have actually retired already if I didn’t make some of these boneheaded giant mistakes, but that’s part of the journey. And those are the kinds of things we’ll help you avoid because we’ve done them ourselves.
So, this is intended to be as encouraging as possible. It’s totally doable. Get started. You think Badger, it will be a good idea now. Oh. I thought we could end by giving a summary, you know, of the main points. But remember, there’s one thing that I discovered in this, in the research we were doing that really got me excited.
I, so we are not paid by this company. In fact, we have, yeah, we have no association with them. But as I was looking up a bunch of this stuff, I came across Something called Greenlight. So if you Google Greenlight, you’ll see, or Greenlight Investing, you’ll see that it’s one of these companies that kind of created a user interface. On top of all the brokerage stuff underneath. So basically you, you sign up for an account, [00:43:00] there’s an app and blah, blah, blah, and then they kind of take over from there. But what got me so interested in it is that they have, one of their functions is exactly what we’re talking about. You set up an account for your kids, right?
You deposit money on their behalf. And then once they get into the company, picking companies and investing stage, You could see, right, because it’s a shared account, you could see that they are trying to buy, let’s say, a share of Apple computer, you get notified as the parent, right, your child wants to buy one share of Apple, and then you as the parent get to approve or veto that purchase.
So it’s sort of like you’re saying to your child, Okay, here’s the money. You go. We trust you. And then you’re just overseeing whether they’re on the right path in terms of like picking legitimate companies or whether they’re sort of going off the rails and like, you know, looking for gambling like stuff, which you want to mix and [00:44:00] veto.
But if I had that, that’s what I would do right now. If I had my own young child, this is exactly the kind of platform I would open up. And, and help monitor
[00:44:11] Luke: Looks like a really nice tool. I don’t think it’s available in the UK, but it’s a great principle and a great approach. You can do the same thing, even as a UK parent, just with a conversation with your kids. I’ve got a couple of friends who are investors and they regularly have conversations with their children.
Now, in fact, one of my buddies, his eldest child came to him a couple of weeks ago and said, Hey dad, I want to invest in this company. And they sat down and had a really nice conversation about it. And maybe this is a learning opportunity for you as well to go and research that company together.
And if you want to know how to do that, well, this is the kind of stuff we talk about in this podcast.
[00:44:46] Krzysztof: right in another discovery I made second platform that really sparked my interest badger. Some a company called acorns and they have a bunch of like sub offerings under the acorns brand, something [00:45:00] called acorns early. Here’s why I got excited. It’s the holiday season, right? So people are always wondering what can I give so and so, right?
And we end up giving stupid gift cards half the time. Acorns Early, I think this is brilliant. They allow you to send gift links to their investment accounts. So you set up one of these accounts, right? And then you can send an email to your family saying, if you’re thinking about what to get little Bobby for, for the holidays, Here’s the link to their investment account and you could drop whatever 20 bucks, 50 bucks, a hundred bucks, it’ll show up in their investment account.
And that will become thousands of dollars 20 years later, as opposed to the gift card to, you know, beef jerky city. com.
[00:45:51] Luke: So I hope we’ve at least got you thinking about the power of becoming an investor, both yourself and for your kids. [00:46:00] And you know, don’t, don’t treat this lightly. Like if this is. If this resonates with you and if you think this is something you can incorporate into like the conversations you have with your kid, take it seriously.
It can make a really big difference. And if you’ve enjoyed the conversation we’ve had today, maybe share it with a couple of friends. You might advise them just to go listen to like the first 15 minutes. Cause you know, like this complex stuff is probably not the right world for them. But that first 15 minutes about just open a tax efficient brokerage by one of those passive index trackers we recommended.
Like that is life changing stuff.
[00:46:36] Krzysztof: And I want to triple down on this badger. You might be the, you listening to this podcast right now might be the person that changes the future of your entire family. And we’re not exaggerating when we say this, like, think about it, really think that by taking this seriously and by not delaying, not procrastinating, [00:47:00] actually rewinding the conversation, following the steps, opening the account today, 20 years from now, your, your cousins and your nephews and your nieces and your children and their friends.
might be so much better off than if you didn’t take these steps. Now it is important. It is life changing. So, I mean, I, if I had a drum right now, I’d be beating it. Like pay attention, do this, do this now.
[00:47:28] Luke: I, I can only imagine what would have happened if I’d started, if my parents had started investing for me when I was born or when I was like five or six years old. I didn’t start till I was 30 and I retired when I was in my forties, like almost. Almost, you could run into the opposite problem, which is beyond the scope of the conversation we want to have today, which is, I’m going to lean on a really famous Warren Buffett quote.
And he was talking about like inheritance. And he said, you should leave your children enough so that they can [00:48:00] do anything, but not enough so they can do nothing. Like if you get this journey started well, and you invest smartly and you make good decisions, you could almost have the opposite problem where your kids could have too much.
Right. So this is why getting the financial grounding and the education and the appreciation is a parallel journey you should take as well as like building the pot of money. But Hey, look, nice problem to have if that’s something you start running into at some point.
[00:48:30] Krzysztof: And you know what, as we record this conversation, I think I just inspired myself. I didn’t think this would be the outcome, but I have a 22 year old stepdaughter who is trying to be a professional musician. So we know that that is a hard road probably. And as I was listening to my, my own speech, I was like, wait, why don’t I do the same thing for her right now?
Just because she’s in her early twenties, it’s [00:49:00] not too late. Like in 20 years, she’s only going to be 40, 42. And if I only add 25 bucks a month, I know that I know that’s going to be in the thousands of dollars. So that’s probably one of the first things I’m going to do myself right now, after we finished recording is opened up exactly one of these accounts hit, you know, and just follow the steps.
So maybe this is a good point in the show to vary in a condensed way. Repeat what the actionable points are.
[00:49:29] Luke: Yeah. Open a brokerage account wherever you are. Make sure it’s tax efficient. Like the rules are going to be different in every country, but we gave you an example of a junior writer in the UK.
Or a 5 29 or that other crazy acronym in the us if you just wanna keep it simple by one of the passive index trackers we recommended, which in the UK was VWRP. In the US it was VTI. And that’s just a great place to start. If you want to go a bit [00:50:00] deeper, click the subscribe button on this podcast. Start building your own financial toolkit, and then as you build up some money in these passive index trackers.
Maybe you take a chunk, maybe you, maybe you have like 75 percent of the money in the passive index tracker and the other 25 percent is money that you’re going to like build your investing toolkit with. And maybe as Krzysztof said, take that chunk of cash and buy 10 companies that you really like and believe in and, and you’ll learn what it means to be an investor, like truly
[00:50:37] Krzysztof: Right. And then you join our Patreon page where you meet all kinds of other investors on this journey where we exchange information and we talk about all this stuff and then it becomes fun. The additional point I’d say is that I really do. Like this product green light or acorns early. So that is one of the accounts that I might.
Set up immediately and then hit [00:51:00] the recurring revenue. I, I, I wish I knew what that term was recurring additional money, say the first of the month, and that’ll, that’ll be it. And then you’re off to the races.
[00:51:11] Luke: great stuff.
[00:51:12] Krzysztof: So yeah. Let’s encourage our listeners because this is such a I think passionate topic for us.
Let’s encourage all our listeners to drop us a comment or question on the YouTubes. at Wall Street Wildlife or on our Patreon page, patreon. com slash Wall Street Wildlife. We will read all of them and we will address whatever remaining concerns or uncertainties you may have.
[00:51:37] Luke: Great stuff. And if you found this valuable, like send a link to a friend. This is, we’re recording mid December. This episode is going to go out like I think Christmas Eve. So your kiddies are probably going to have like a bit of holiday Christmas cash to invest. So like right now is a great chance to use that money and get that snowball [00:52:00] rolling.
[00:52:00] Krzysztof: Bingo. Ho ho ho. Happy holidays. Thanks for, thanks for listening and let us know how it goes. Keep us updated on your journey and maybe even what snags or what, what complexities you ran into and we’ll help you through them.
[00:52:14] Luke: Are you ready to become a beast of an investor?
[00:52:16] Krzysztof: Your journey starts right here.
