Just Keep Buying

Text in black are quotes; text in green are my notes. I sometimes write in Spanish.

• To build wealth it didn’t matter when you bought U.S. stocks, just that you bought them and kept buying them. It didn’t matter if valuations were high or low. It didn’t matter if you were in a bull market or a bear market. All that mattered was that you kept buying. #

• It’s not about when to buy, how much to buy, or what to buy—just to keep buying. The idea seems simple because it is simple. Make it a habit to invest your money like you make it a habit to pay your rent or mortgage. Buy investments like you buy food—do it often. #

  • Dollar-Cost Averaging en acciones de Estados Unidos ha sido y sigue siendo una de las mejores estrategias para generar riqueza.
  • Es difícil de creer porque lo único que tienes que hacer es comenzar a comprar acciones, y seguirlas comprando, sin importar el estado actual del mercado. Es tan simple que no parece real.
  • Es de los mejores hábitos que puedes crear; comprar ETFs como si fuera un recibo de luz o agua.
  • 💡 Un producto/servicio que te envía un "recibo" ficticio cada mes, como si fuera la luz, pero es un recibo de lo que debes invertir en el S&P 500, ajustado a la inflación más actual.
  • Occam's Razor

• Today you can purchase a single share of an S&P 500 index fund and have every person in every large public corporation in America working to make you richer. #

  • Inversiones antes y ahora; Antes: Necesitas $50,000 pesos para comenzar a invertir en renta variable, en un fondo activamente manejado por "expertos", con comisiones por los cielos. Ahora: Inviertes desde $100 pesos, en un ETF administrado pasivamente con comisiones por los suelos.

• If you don’t have much money invested, then you should focus on increasing your savings (and investing it). However, if you already have a sizable portfolio, then you should spend more time thinking about the details of your investment plan. More simply: saving is for the poor and investing is for the rich. #

  • ¿Tienes poco o nada invertido? Enfócate en ahorrar e invertirlo.
  • ¿Tienes mucho invertido ya? Enfócate en planear bien tus inversiones y optimizarlas. En segundo plano, sigue ahorrando e invirtiendo.

• If your expected savings are higher, then you need to focus more on saving money and adding to your investments. However, if your expected investment growth is higher, then spend more time thinking about how to invest what you already have. If the numbers are close to each other, then you should spend time on both. #

• These articles share the same flawed assumptions. First, they assume that income is relatively stable over time. Second, they assume that people at all income levels have the ability to save at the same rate. Both of these assumptions have been disproven by academic research. #

• When we have the ability to save more, we should save more—and when we don’t, we should save less. We shouldn’t use static, unchanging rules because our finances are rarely static and unchanging. #

• This is why the best savings advice is: save what you can. If you follow this advice, you will experience far less stress and far more overall happiness. #

  • Hay meses de vacas flacas y meses de vacas gordas. Muchas veces nuestro ingreso es variable, ¿por qué habrías de ahorrar siempre un % como si fuera una ley?
  • Ahorra lo que puedas y deja de castigarte cuando no puedes ahorrar ese número definido por alguien al azar.
  • Si puedes ahorrar más, ahorra más. Si no puedes ahorrar tanto, ni modo, ahorra lo que puedas y sigue con tu vida.

• Because I save what I can, I am able to enjoy my money instead of questioning every financial decision I make. #

• Increases in income aren’t followed by similar increases in spending. #

• You can see your income increase by a factor of 10, but it is unlikely that you will spend 10 times more on food, housing, or any other necessity as a result. While you might increase the quality of food and housing you consume, these higher-quality items are unlikely to cost 10 times more. #

  • Cuando tienes un ingreso muy bajo, un incremento de sueldo te puede llevar a gastar lo mismo que ganas.
  • Pero ya que tienes un ingreso decente, incrementos en este no necesariamente llevan a gastos de la misma magnitud.
  • Si ganas 10x más, está cabrón que gastes 10x más. Comprarás cosas de más calidad, como comida y muebles, pero está difícil que cuesten 10 más.

• researchers at the London School of Economics released a paper titled, “Why Do People Stay Poor?” that illustrated how the lack of initial wealth (and not motivation or talent) is what keeps people in poverty. #

• Their paper clearly illustrates that many poor people stay poor not because of their talent/motivation, but because they are in low-paying jobs that they must work to survive. They are, in essence, in a poverty trap. #

  • La dura verdad es que la mayoría de las personas no se alejan mucho del estado social en que nacieron.
  • Si naces en una familia en la que tienes que trabajar, en lo que sea, con tal de sobrevivir y llevar pan a la mesa, es difícil que con puro talento o motivación salgas muy adelante.

• The most consistent way to get rich is to grow your income and invest in income-producing assets. #

• If you want to save more, the main point is to tighten up where you can, then focus on increasing your income. #

• And the best way to increase your income is to find ways to unlock the financial value that is already inside you. I am talking about a concept called human capital, or the value of your skills, knowledge, and time. Your human capital can be thought of as an asset that you can convert into financial capital (i.e., money). #

• The end goal should be ownership—using your additional income to acquire more income-producing assets. #

• The simplest way to know whether you acknowledge prices is to imagine how you might feel if you sat down at a restaurant where the menu had no prices.” #

  • Esa es la prueba de que te importan o te fijas en los precios de las cosas; me sentiría muy extraño ir a un lugar en que el menú no tiene precios.

• The first tip is what I call The 2x Rule. The 2x Rule works like this: Anytime I want to splurge on something, I have to take the same amount of money and invest it as well. #

  • ¿Te cuesta desembolsar grandes cantidades en alguna compra? ¿Te sientes culpable?
  • Hay una cura sencilla: cada vez que hagas un gasto grande, invierte esa misma cantidad.

• The authors of Happy Money: The Science of Happier Spending found that spending money in the following ways was most likely to increase your overall happiness:26 Buying experiences Treating yourself (on occasion) Buying extra time Paying upfront (e.g., all-inclusive vacations) Spending on others These are all areas where having (and spending) more money generally means more happiness. #

• After all, it’s not the purchase that makes you feel guilty, but how you justify that purchase in your head. And if you don’t have a good reason to buy something, then you will probably feel bad about it later. You can lie to yourself all you want, but deep down you know the truth. #

  • Muchos de nuestros gastos son por necesidad; comida, renta, agua, luz, etc. No pesa hacer el gasto, pero tampoco es como que traigan mucha felicidad.
  • Pero hay muchos otros gastos que sí traen consigo mucha felicidad, como: Comprar experiencias; pagar vacaciones por adelantado; gastar en otras personas; comprar tiempo. Encuentra esos gastos y gasta en ellos sin culpa.

• While your home is unlikely to crash in value, it’s also unlikely to be your long-term ticket to wealth either. More importantly, even if you see your home price increase significantly, you can only extract that value if you sell and buy a cheaper home elsewhere, or if you sell and go back to renting. #

  • A la gente le gusta mamar como la casa que compraron **para vivir** aumentó x% de valor en el último año. Y aunque eso sea cierto, sigue siendo una plusvalía, no hay nada materializado.
  • Para obtener ese rendimiento de regreso, que por cierto no será la cantidad que crees (impuestos, trámites, etc), tienes que vender la casa. Y si era la casa en que vivías, tienes que ahora comprar otra o rentar. Entonces, tus "rendimientos" no terminan más que siendo tu enganche para la siguiente deuda.

• Deciding to retire is far more than just a financial decision, it is a lifestyle decision too. So, in order to know when you can retire, you need to figure out what you will retire to. How will you spend your time? What social groups will you interact with? What will be your ultimate purpose? Once you have good answers to these questions then you can retire. Otherwise, you may be setting yourself up for a future of disappointment and failure. #

• As Adam Fergusson described in When Money Dies: “There were stories… of restaurant meals which cost more when the bills came then when they were ordered. A 5,000-mark cup of coffee would cost 8,000 marks by the time it was drunk.” #

• Jay’s realization—what works for some people won’t necessarily work for others—is as true in judo as it is in investing. #

• As Jeremy Seigel stated in Stocks for the Long Run, “The real return on [U.S.] equities has averaged 6.8 percent per year over the last 204 years.” #

  • Dado un periodo suficientemente largo, las inversiones en renta variable en EUA han dado rendimientos promedios anualizados del 6.8%.

• Despite all the praise that I have just given to stocks, they are not for the faint of heart. In fact, you should expect to see a 50%+ price decline a couple times a century, a 30% decline once every four to five years, and a 10% price decline at least every other year. #

  • La renta variable, cuando es bien administrada, es de las mejores inversiones que puedes hacer. Pero para poder administrarla bien, necesitas mucho estómago.
  • Si entras al juego, espera una caída de 50% en algún momento de tu vida; una caída de 30% cada cuatro a cinco años; y una caída del 10% cada otro año.

• As the old saying goes: “We buy stocks so we can eat well, but we buy bonds so we can sleep well.” #

  • Los bonos son instrumentos para reducir el riesgo de tu portafolio. Úsalos para dormir más tranquilo, no para hacerte rico.

• If you want to be an owner + operator of a small business or franchise, just remember that as much work as you think it will take, it will likely take more. Brent Beshore, an expert on small business investing, once tweeted that the operator’s manual to run a Subway restaurant is 800 pages long. Imagine trying to run a $50m manufacturer.71 #

• This concept, more formally known as the Lindy Effect, states that something’s popularity in the future is proportional to how long it has been around in the past. The Lindy Effect explains why people in the year 2220 are more likely to listen to Mozart than to Metallica. Though Metallica probably has more worldwide listeners today than Mozart, I am not sure this will be true in two centuries. #

• This is why owning all of the stocks—by buying an index fund or ETF—is usually a far better bet than trying to pick big winners among individual stocks. You are likely to end up with more money and experience less stress while doing so. #

• The one piece of information that can guide your investing decisions is: Most stock markets go up most of the time. This is true despite the chaotic and sometimes destructive course of human history. #

  • En la historia de la humanidad no han importado tanto las guerras, pandemias y otros eventos caóticos; la mayoría de los mercados suben la mayoría del tiempo.

• When deciding between investing all your money now or over time, it is almost always better to invest it now. This is true across all asset classes, time periods, and nearly all valuation regimes. Generally, the longer you wait to deploy your capital, the worse off you will be. #

  • Casi siempre es mejor invertir todo de una que hacerlo poco a poco. No importa mucho el tipo de activo o periodos.
  • Invierte lo más pronto posible, y lo más frecuente que puedas.

• Taken together, the conclusion is undeniable: You should invest as soon and as often as you can. #

• Smith’s story illustrates an important lesson about risk and the cost of inaction — sometimes the biggest risk you can take is taking no risk at all. This is especially true in investing. #

  • A veces el costo de no actuar, como no invertir, es uno de los riesgos más grandes.
  • Pero también, tomar acción durante una crisis puede no ser la mejor opción. Quedarte quieto puede ser una buena alternativa.
  • El costo de no tomar acción es mucho más grande que el de tomar una acción incorrecta. La mayoría de los fracasos los pagas una sola vez; la mayoría de tus arrepentimientos son costos recurrentes.

• As Friedrich Neitzsche once said, “Ignore the past and you will lose an eye. Live in the past and you will lose both.” Knowing history is important, but obsessing over it can lead us astray. #

• Fund the life you need before you risk it for the life you want. #

• After all, is the top 10% rich? The top 1%? The top 0.01%? And at what aggregation level? Globally? Nationally? City-wide? There is no right answer, because being rich is a relative concept. Always has been and always will be. And that relativity will be present throughout your life. #

• But that’s not really important. As Dominic Toretto, Vin Diesel’s character in The Fast and the Furious, once said, “It don’t matter if you win by an inch or a mile. Winning’s winning.” #

• The reason for my mistake is that I incorrectly believed that money was a more important asset than time. I only later realized why this was false. Though you can always earn more money, nothing can buy you more time. #

  • Muchos cometen el error en pensar que el dinero es más importante que el tiempo. Sacrifican muchas horas de su vida en buscar más dinero solo para, muy tarde, darse cuenta de que el tiempo era más preciado y ya no lo pueden tener de vuelta.