They're Lying to You About Investing! 4 Myths Keeping You Broke

Cult Insight

In this video, I share the biggest investing myths that quietly keep people from building wealth — and the simple truths that will finally help you start investing with confidence.  DISCLAIMERS & DISCLOSURES  This content is for educational and entertainment purposes only. I does not provide tax or investment advice. The information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. All investing involves risk, including the possible loss of principal.   Thank you for your support!  *T&C's apply

Transcript

00:00Just 23% of Brits have invested in the stock market. It's a similar story in China and even

00:05lower in other parts of the world, including France and Germany. And while some people genuinely

00:10can't afford to invest, for others, it's a different story. If you're new here, hi, I'm

00:15Nisha. I'm a former investment banker turned financial educator. And today I'm breaking down

00:19big investing lies that could be keeping you broke and finally telling you the truth. By the end of

00:25this video, you'll know firstly, why these myths are so unbelievably common. Secondly, how they

00:31quietly hold you back from building wealth. And third, the truth and how to rebalance them with

00:36beliefs that actually make you money. Myth number one, investing is just gambling. 55% of Brits are

00:42unwilling to invest their savings in the stock market, according to a YouGov poll. And 65% of

00:48those who don't invest say it's too risky. And I can see why so many people feel this way, because

00:54unless your parents taught you about the stock market or you studied finance, you probably

00:59learned about investing from the news or through social media. And when markets crash or crypto

01:04prices skyrocket overnight, investing can look a little bit like gambling, like walking into

01:10a casino and putting your life savings on black. You stake your money, the numbers go up and down,

01:15and if you're lucky, you double it. If not, you lose everything. Not exactly the best first

01:20impression. If this fear sounds familiar, here are a few things to keep in mind. First, gambling is

01:25based on luck, and the odds are stacked against you. Even if you win early, gambling always has a

01:32negative expected return. The house always wins by design. Investing, on the other hand, isn't like

01:37that. When you invest, you own real pieces of real businesses, companies that make products, employ

01:44people, and generate profits. Over time, those profits drive returns and are passed on to investors

01:50in the form of dividends and rising share prices. In fact, over the past century, stocks and bonds

01:54have reliably produced positive returns, and the longer you stay invested, the more likely you are

01:59to win. Using almost 100 years of data on the US stock market, Schroeder's found that if you invested

02:05for a month, you would have lost money 40% of the time in inflation-adjusted terms. However, if you had

02:11invested for longer, the odds would shift dramatically in your favor. On a 12-month basis, you would have

02:17lost money 30% of the time. Over the five years, that figure falls to 22%, and at 10 years, it drops

02:23to 13%. The data also shows that there have been no 20-year periods where large-cap US stocks lost

02:30money in inflation-adjusted terms. Even more reassuring is that after sharp daily drops, the market

02:36often rebounds quickly. In fact, more than a quarter of recoveries happen within days. But you rarely see

02:42that headline. The news loves reporting market crashes, not quite recoveries that follow, which makes

02:47investing look far riskier than it really is. And this matters because research shows that negative economic

02:53news has a stronger emotional impact than positive news. So when we see dramatic downturns splashed across

03:01the front pages, but not the rebounds, it reinforces the myth that investing is dangerous. And there's also a

03:08psychological element. Studies show that the same part of the brain that lights up during gambling also activate

03:14when people trade volatile assets like crypto or options. That's why some investors chase trends, try to time the

03:21market, or panic sell when prices fall. It's the same thrill of the chase and the same urge to win back losses when

03:28something goes wrong. A long-term investor, on the other hand, does the complete opposite. They diversify,

03:33they stay invested, and they focus on building wealth over time rather than hoping to hit the

03:37jackpot. And that is what we're going to be talking about on Sunday. Depending on when you're seeing this,

03:41it is today. So if you don't know what to invest in, how much to invest, how often to invest, or you're

03:46just scared of getting it wrong and losing money, then I have a completely free workshop happening today

03:52on Sunday, the 26th of October at 5 p.m. UK time. We will walk through the exact system you need to

03:58follow to start investing with confidence. It's completely free. It's 45 minutes, and you can sign

04:03up at nisha.me forward slash invest. Also linked in the description, that is nisha.me forward slash invest.

04:09Myth number two, I don't know enough to invest. In 2012, the Observer newspaper ran a competition to find

04:16out who's best at picking stocks. There were three contestants, three experienced money managers.

04:21Secondly, a group of high school kids. And thirdly, a ginger cat called Orlando. Every contender was

04:27given an imaginary 5,000 at the start of the year to invest. By the end of the year, the professionals

04:31had grown their portfolio to 5,176. The students were down to 4,840. And Orlando had amassed 5,542.

04:42He chose his stocks by throwing a toy mouse on a grid of numbers allocated to different companies.

04:47So tell me then, why 41% of Brits say they don't invest because they don't understand how the stock

04:52market works? Because although the Observer's experiment was more fun than science, it still

04:57underlines decades of genuine research that shows experienced investors struggle to beat the market.

05:04In fact, in the US, 88.29% of funds underperformed the S&P 500 index over the last 15 years.

05:12And that's actually good news for you because it means you don't need to be an expert to get started.

05:16You don't need to spend your mornings reading the Financial Times or trying to find the next

05:21NVIDIA because that's exactly what index funds are for. They let you invest in hundreds,

05:26sometimes thousands of companies all at once. So instead of guessing which ones will do best,

05:31you automatically own a tiny piece of all of them. It's a really great way of reducing the risk too

05:35because if one company has a bad year, it won't have that much of an impact on your overall return.

05:41And historically, the market as a whole tends to grow over time. So the biggest risk

05:45isn't doing it wrong. It's just doing nothing because you're afraid of getting it wrong.

05:49So you learn far more by investing a really small amount and just watching how it behaves

05:53than by waiting until you know enough. Because no one feels like an expert when they start and

05:58even the professionals don't have it all figured out yet. But you don't need to be an expert to

06:02make progress. You just need to start, learn a little as you go and let time do most of the work.

06:07Myth number three, I don't have enough money to get started. According to a study done by Deloitte

06:12Access Economics, more than one in two people who don't invest said they don't have enough money to

06:17get started. One in four expected to need more than 10,000 before they could finally take the

06:23first step to building wealth. It is a really common misconception and one that keeps people

06:28on the sideline for years. Because when most of us picture an investor, we imagine someone with this

06:34five-figure portfolio, complex spreadsheets and insider knowledge. It feels like a club that you can only

06:40join once you're already wealthy. But that's never been true and it's definitely, definitely not true

06:46today. Thanks to fractional shares and investment apps, you can now start with as little as one pound.

06:52There's no minimum balance, no gatekeeper, no human that you need to go through like you had to

06:57in the olden days and no need to wait until you're rich. What matters most isn't how much you actually

07:03invest, it's how early and how consistently you do it. Because compounding rewards time, not wealth.

07:09In fact, I'm going to show you the numbers. Someone who invests 50 a month at 25 will likely end up

07:13with more than someone who invests 100 a month starting at 35 simply because their money had an

07:19extra decade to grow. The biggest mistake people make is waiting until they feel ready. But the truth

07:24is you will never feel ready. There's always going to be another bill. There's always going to be

07:29another goal. There's always going to be another reason to delay. The key is to start where you are,

07:35even if it's just a few pounds or a few dollars or a few euros, build the habit first. The numbers

07:41will then follow. Every investor that you admire started with something small. The only difference

07:48is they didn't wait until they could afford to, they started so they could. Myth number four,

07:53it's too late to start. You've probably heard stories about people who started investing 500 a

07:58month in their 20s, got an average annual return of 10% and retired at 50 with more than a million in

08:04the bank. But how many people can actually do this in their 20s when we're only just finding our feet

08:08in the world? You might still be at uni doing an apprenticeship or in the early stages of your

08:13career, your income is probably quite low. And as the years pass by, the financial obligations do

08:18start creeping up. While you're mid to late 20s, you might be trying to get on the property ladder,

08:24staying out of credit card debt or trying to save for a wedding. With so many short-term expenses to

08:29budget for, it's only natural to just say, I'm going to push investing to one side and focus on

08:34it when I can. And then by the time we reach our 30s or 40s and we look back on how much progress we

08:40could have made if we started investing earlier, it's natural to just feel it's too late. You start

08:44playing around with an investment calculator and you think, okay, if I started 15 years ago and

08:49invested 200 a month and got a return of 10%, I'd have more than 80,000 already. Stop torturing yourself

08:54and start looking forward and settle back. Start now with 200 a month and you'll reach the goal in

09:0015 years from now. If you can increase your contributions to 300 a month and get the same

09:04return, you'll have more than 120,000. Because chances are by the time you reach your 30s or 40s,

09:10your income's probably higher than it was in your first few years of adulthood. And hopefully you're

09:16more financially stable and you can afford to invest more each month. And that makes a much bigger

09:21difference than you might think. So even if you're starting later, you haven't missed out.

09:25The time will pass anyway, so you might as well start now. And whilst we're on this topic,

09:29one of the best investments you can make alongside investing in assets is investing in yourself,

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10:13learning new things, Brilliant has something for you. You can try Brilliant at brilliant.org

10:18forward slash Nisha. I've put the link in the description below, or you can scan the QR code

10:23on the screen right now. Brilliant's also given our viewers 20% off an annual premium subscription,

10:27which gives you unlimited daily access to everything on Brilliant. So quick recap, what we've covered,

10:33investing isn't gambling, it's owning real pieces of businesses that grow and pay you over time.

10:37Second, you don't need thousands to get started. You can begin with whatever you have. Third,

10:42you don't need to know everything before you start. You'll learn as you go. Fourth,

10:46it's never too late. What matters most is that you start now and stay consistent,

10:50even when the market goes up and down and the news may seem like it's the end of the world.

10:54Because if you haven't started investing yet, these myths might be surprisingly comforting.

10:58They give you all the reasons to wait, to put off, to tell yourself, I'll invest when I earn more,

11:02when things calm down. But the truth is, waiting is the most expensive decision you'll ever make.

11:08No matter how much you're starting with, just start. Time will pass anyway,

11:11so you may as well put your money to work today. Thank you so much for watching. If you know

11:15someone who hasn't started investing yet, but has used one of those myths that you've heard today

11:20as an excuse, don't forget to share this video with them and don't forget to subscribe if you

11:24haven't already. Otherwise, I'll see you in the next one.

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