5 Jul

3 steps I think you need to follow to get rich

first_img3 steps I think you need to follow to get rich Simply click below to discover how you can take advantage of this. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Rupert Hargreaves | Saturday, 15th February, 2020 I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. “This Stock Could Be Like Buying Amazon in 1997” See all posts by Rupert Hargreaves Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee.center_img Being able to build a large financial nest egg and retire early is the dream for many people. Unfortunately, many people make a couple of simple financial mistakes that prevent this. With this being the case, here are three steps you can follow to get rich and retire early and avoid making these mistakes along the way.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Start savingThe first big mistake people make is not saving. Even if you’re saving a few pounds a week, it can make a big difference. The sooner you start saving, the better, as it allows the power of compound interest to start working its magic.For example, putting £5 a week into a savings account with an interest rate of 1.5% from the age of 18 will leave you with a savings pot of £18k at the time of retirement (65 years of age). During this period, your money will have earned £5.7k of interest.Start investingIf you’re saving a little every month, the next step on the journey to wealth is to start investing your money. As the example above shows, with interest rates where they are today, even if you save diligently for decades, your money won’t grow in a cash account.If, on the other hand, the same £5 a week is invested in the stock market, after 47 years it could be worth £97k. That’s assuming an annual rate of return of 7%.Let the market do the hard workInvesting your money can turbocharge returns, but it can also expose you to risk. There are two main risks investors need to be on the lookout for. Bad investments and high fees. Bad investments can end up costing you a lot of money and setting back your retirement plans. High fees will do the same.Using the same figures as the example above, a saver who’s unlucky enough to choose a fund with a 2% annual charge will end up paying £51k worth of fees during the 47-year holding period.A great solution to both of these problems is to buy a low-cost index tracker fund. Index tracker funds are great because they let you track the market for almost no cost whatsoever. There’s also no stock-picking risk associated with the fund. They just own the underlying index and leave it at that.This does mean there’s no chance of beating the market. However, research shows that most active managers don’t outperform the market over the long term anyway. So there’s no reason to pay higher fees in the hopes of achieving a better performance. The odds are you’ll end up paying more for an average performance.Today, there are FTSE 100 and FTSE 250 tracker funds on the market that charge less than 0.1% per annum in fees.Putting it all togetherSince its inception, the FTSE 100 has produced an average annual return for investors in the region of 9%, and the FTSE 250 has returned around 12%.These figures imply an investor who saves £200 a month would be able to accumulate a savings pot of £1.5m over 47 years using the FTSE 100 (and paying 0.1% per annum in fees). An FTSE 250 investor will be able to accumulate a nest egg of £4.2m, based on the above returns. Enter Your Email Address Our 6 ‘Best Buys Now’ Shares Image source: Getty Images. Rupert Hargreaves owns no share mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.last_img

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