Who We Are & Why We Invest

Bryce: [00:00:36] Welcome to get started, investing a series of lessons to help you on your investing journey. This is for anyone who wants to start investing but really isn't sure where to start. Our aim is to make the markets accessible to you. My name is Bryce and I am joined by my co-host. His parents named you Alec, but the market's name is Ren. How's it going, bro? [00:00:55][19.5]

Ren: [00:00:56] It's very good, Bryce. [00:00:57][1.0]

Ren: [00:00:57] I am very excited for this series. We've been doing our Equity Markets podcast for about two and a half years now and we thought it was time to pull out some of the best lessons we've learned from that time, from the experts we've spoken to and put together a standalone investing one to one series. [00:01:14][17.0]

Bryce: [00:01:15] Yes, our first spin off, hopefully not our loss. Yes. This is huge. Yeah. Yeah. So hopefully it goes well. [00:01:20][5.7]

Bryce: [00:01:21] Yeah, I'm very keen, Ren. Just want to welcome everyone to get started investing. And to the journey of investing. It's a big step and we're super excited that they have found this podcast and we're really keen to help them on their way. So when the stock market is the greatest wealth creating machine in history, one of your favorite lines that you say quite often, yet we find that many people miss out on it. So we want to make sure that kind of stops right now and everyone can get involved in the market. So when equity mates started Ren, we were just like everyone else who's probably listening to this for the first time, unsure where to start. Overwhelmed with all the jargon. So we used equity mates to better understand the markets we used as an excuse to go and chat to CEOs and fund managers to help to improve our understanding of the markets. And we used it as a way to try and break down the barriers to investing for all sort of those millennials out there who are looking to access the markets. So we are living proof that anyone can invest. So I guess our first message to start with is, don't be afraid. That's going to be our theme to carry this through Ren. So in this series of podcasts, we're going to equip you with the knowledge and the skills to go from beginning to do it. In other words, everything from setting up your account, choosing what to invest in, and then hopefully making your first trade. Once we finish this series, come across and join us at Equity Mates Investing Podcasts, our flagship show, Under Equity, MIT's Media Proprietor, and continue the journey with us and with our community. I think one of the biggest pieces of feedback from our community is that we've got 170 episodes now. All things to do with investing. And rather than go back and listen to everything the whole way through, which by all means you can do. This is probably a really good condensed place to start and then come and join us as we continue the journey of investing. So Ren, what's today's episode all about? [00:03:10][108.2]

Ren: [00:03:10] The first episode to kick things off is who we are and why do we invest. We we want to just set the scene of who you're going to be hearing for the next twelve and half episodes and understand from our personal perspectives why we think investing is a really important life skill to have and to share what we've learned in terms of the why over the last two and a half years. So we start with our stories, who we are, how we started investing. One had a more successful start than the other. So we'll hear about that. And then we just want to talk about some of the key reasons why we think it is probably the most important financial decision you can make, especially early in your life, to get started investing into to invest throughout your life. You wanna kick it off? Do you wanna take us out of our misery? Who? Who are you priced and why are listening to. [00:04:01][51.4]

Bryce: [00:04:02] Absolutely Ren. So Ren. I met you at the university back in the early days, Carmen. What year? It was 20 11, 2011. Yeah, we lived together for a bit and I had been investing for a while. [00:04:14][12.3]

Bryce: [00:04:15] When I met you, my story begins way back in primary school where my parents were giving me small amounts of pocket money. I think it started at 50 cents and they encouraged me to save a proportion of that over a long period of time to go towards buying stocks. At the time, I didn't realize that's what it was for, but they just encouraged me to do that. When I hit 500 bucks. So probably took 10 years or something like that to say five hundred dollars through 50 cents. Dad then put it into a listed investment company, which will address a bit later on. But my first investment was in a company called Brickworks Ltd and I put 500 bucks in and that was very much the start of my investing journey for a few years after that. Just continued to add to that. And the story goes from there. Here we are two and a half years into the podcast. Maybe 10 or 12 years into my investing journey. And it's all been a wild ride. [00:05:03][48.7]

Bryce: [00:05:04] So, yeah, I think it's been fun. And you have a slightly different start to your investing journey. Ren. [00:05:10][5.7]

Ren: [00:05:10] So that was all about your investing journey. But who are you? [00:05:13][2.9]

Bryce: [00:05:15] You know, though, worked for Woolworths. Just watched your footy team Losing the finals. Essendon played last night. They were no sorry. Night before last up against West Coast Eagles. This broadcast is going to be timeless. Don't worry about. [00:05:29][14.3]

Bryce: [00:05:31] Follow the bombers work at Woolworths and living in Sydney has been. For about four years. Passion for investing, love, playing the drums, although I haven't been able to do that because my drum kits at my parents place in WAGGA. Sydney doesn't have the room for me to set it up. So that's who I am in a nutshell. Ren. How about yourself? [00:05:47][16.1]

Ren: [00:05:48] I think the key takeaway from that and the key takeaway from mine as well is we're not experts where we didn't study finance at uni. We don't work in investment banks. That's not who we are and that's not what we're about. My story is similarly amateurish, I guess, in terms of my path to investing. As you said, we met at uni. I grew up in a family where investing was buying a house and your wealth was tied up in your house. And hopefully that appreciated over the time you lived in it. And then you retired and maybe you sold it and downsized and that funded your retirement. That was the this story of investing as I grew up. We met at uni. I found learning about stocks really interesting. Talking about them with you and some of our other mates was just a really interesting way to learn about the world. And so started investing probably in maybe 2013, 2014. So still relatively new to it all. But my first investment didn't go as well as this is for those who are familiar with the law firm Slater and Gordon. I put my first thousand dollars into that company and managed to lose ninety nine point five percent of my money. I've literally lost so much money on it that I can't sell the rest of it because the cost of selling it would actually outweigh any money I got back. [00:07:10][82.0]

Bryce: [00:07:11] You literally, literally cannot sell it. [00:07:14][2.2]

Ren: [00:07:14] So if you want to know about investing horror stories, I think you're not going to have a worst first trade than I am. But you know what? The beauty of investing and then we're gonna get into this a bit later is the upside is a lot bigger than the downside. You can only lose the money that you put in, but you can make a lot more than that. And I got very lucky on my next trade and managed to make all the money that I lost on Slater and Gordon back and then some more. And so this story of investing is a story of asymmetrical upside. Do you have more chance to make money than you do to lose it? That was a real important lesson for me, that even if I make the biggest mistakes, there's still a way to make money and come off better off over the long term. [00:08:01][47.2]

Bryce: [00:08:02] So so that was my entry into investing and full credit for continuing from that point. I mean, one of the biggest things that many beginner investors say as a barrier is the fear of losing money. And you certainly lost money on it for credit to the commitment to continue and not sort of throw the throw the towel in from the get go once and sort of say, well, I've lost money. You know, there's probably not much hope. I don't know enough about it. And I think that is probably one of the biggest lessons you perhaps learned early on is to continue push forward. [00:08:35][32.9]

Ren: [00:08:35] That's it. And if anyone can top my story in terms of worst first investment, write in and we'll give you a shout out. [00:08:42][7.1]

Ren: [00:08:43] We can keep you anonymous, though, if you don't mind getting out there. [00:08:46][3.2]

Bryce: [00:08:46] So the second part to this, I guess, is about why we want to invest Yde or why do we invest? And there are a few key points we'll touch on. But I guess my first question to you is, what was the trigger point for you to put down that money into Slater and Gordon? Not necessarily. Why did you choose Slater and Gordon? But why did you start from what your parents had done, that traditional I'm going to save for a house. And what sort of led you down the path of investing? [00:09:13][26.9]

Ren: [00:09:14] So I think the more you think about investing in companies, the more you realize that it is this unbelievable opportunity to have some of the smartest minds and the best companies working to make you money. And as you talk about stocks with your mates or as you listen to us talk about stocks on this podcast, you start to realize that there are all these fantastic companies and incredibly smart people who'd literally run their businesses and hire staff across the world to make money and to give money back to their shareholders. And when you think about it like that and you think about the opportunity to be involved in that, it's outrageous. It's, you know, letting your future self down to not take advantage of that. You know, we all talk about Steve Jobs as a visionary. And literally, you could have been a part owner in the company where he was coming up with these things and literally working to make money for his shareholders. You could be one of those shareholders. It's never been more accessible than it is now. When you think of it like that, when you compare that to buying land and hoping that someone in the future is willing to pay more for that same plot of land, it just pales in comparison to the opportunity set that we have to invest in. Companies is on parallel. [00:10:34][79.8]

Bryce: [00:10:35] Yeah, absolutely. As you mentioned there, the accessibility at the moment is incredible. The fact that I can own Amazon, Google, some of the biggest tech companies in the world, as easy as it is to buy a pair of shoes from iconic, you know, I can buy those companies from my bedroom with a few clicks of a button. It's not as easy to go out and buy a house that easily. And the costs in doing so are also quite high, which we'll touch on later. [00:10:58][23.2]

Ren: [00:10:59] The analogy is it's probably as easy to buy a stake in Amazon, the company, as it is to buy something off Amazon because it is easy to buy. Google as it is to Google something. Yeah, it is. It has never been more accessible and it's never been cheaper as well. And so if you're only starting your investing journey today, it will. It's a good time to start. Yeah. [00:11:20][21.3]

Bryce: [00:11:21] And as you said, Ren, there you are becoming an owner of the companies. The whole idea of being a shareholder. And the idea of these companies existing in to some degree is to return value to you. So as a shareholder, as you said, Ren, they are doing all they can to essentially be a better business to return value to the shareholders. So, yeah, great place to start. [00:11:40][19.6]

Ren: [00:11:41] That was my answer to the question. What's your answer? [00:11:43][2.0]

Bryce: [00:11:43] So I kind of was influenced a little by my parents sort of reasoning behind investing in that was using it as a means to build wealth over a very long period of time so that when you get to a later stage in life, you are not necessarily reliant on your paycheck to survive, I guess, and do the things that you want to do. One of the beauties of investing is that with consistency and a reasonable strategy, you can compound your investment portfolio over a very long period of time and remove the need to rely on that paycheck and essentially regain some of the freedom in life that you then want to be able to go and do other things. [00:12:23][39.8]

Ren: [00:12:24] Explain that concept to me. Explain what you mean when you say compound your investment. [00:12:27][3.6]

Bryce: [00:12:29] Sorry if I consistently put money into the stock market over a period of time, year on year. The growth of that investment becomes more and more so year one, I might have say ten thousand dollars in there and it might grow at 10 percent that year. But year two, then let's say it grows another 10 percent. It's actually compounding on top of the growth that has already come from that first year. [00:12:52][23.5]

Bryce: [00:12:53] So one of the eighth wonders of the world, as Warren Buffett said, I think Ironstone, I was nine. [00:13:00][7.2]

Bryce: [00:13:01] Yes, it is is compound interest or compound. And that is because the longer you can let compounding do its magic over a long period of time, do you know you can start getting some absolutely phenomenal returns later on in life? So I think the best advantage we have at the moment, Ren, is that we have time on our side and where young investors and that's probably one of the biggest sort of advantages we have over perhaps our parents at this stage, because we could probably take a bit more of an aggressive approach. So I think, yes, compounding is another reason that we think investing is a really good skill to have. [00:13:34][33.4]

Ren: [00:13:34] Let's play that out with a worked example. Okay. Feels like school. Yeah. So you said we started 10 grand. Yeah. You won and you make 10 percent on it. Yeah. That's you make a thousand dollars. Yeah. So then your investment portfolio is worth eleven thousand dollars. Yeah. [00:13:51][16.8]

Bryce: [00:13:52] So that means eleven thousand year two. [00:13:54][2.1]

Ren: [00:13:55] If I then compound 10 percent on year two rather than the thousand dollars in year one is one thousand one hundred hundred. Which means you've got twelve thousand one hundred dollars in year three. Yeah. And then you're making more next year. So 10 percent of that is 1200. And so every year without doing anything else, other than letting your money grow at a consistent rate. Yeah. You earn more and more every year. Yeah. And so that's that's the eighth wonder of the world right there by sitting on your couch and doing sweet FA. You can make more and more money in the sharemarket. [00:14:30][34.8]

Bryce: [00:14:30] Yes. And that's where the time comes into things Ren. And we have time on our side. So we do. [00:14:35][5.0]

Ren: [00:14:36] There's no time like the present though. Like, regardless of your age, get started to start today than it is tomorrow. [00:14:40][4.8]

Bryce: [00:14:41] Absolutely. So we've spoken about, obviously, the stock market being an incredible wealth creating machine because of compounding. We've spoken about the fact that we can own some of the greatest companies in the world. And with a simple click of a button, what other reasons are there that we both like investing Ren? [00:14:58][17.0]

Ren: [00:14:58] So I think you touched on early retirement, but I think there are so many people out there our age who hate their jobs. Yes, this is the path to giving yourself optionality. There's there's a movement out there. The fire movement, the financial independence, retire early move. [00:15:14][15.5]

Bryce: [00:15:17] I think it's one. And they're very big on saving. Living frugally. Yeah. We're not about that. Well, to an extent, but not every day. [00:15:25][8.5]

Bryce: [00:15:26] What about eating baked beans and white red ties for 20 years just so I can retire 40 grand and live in a tropical island with no. Shoes. Oh, yeah. Yeah. [00:15:39][12.9]

Ren: [00:15:40] So I think where you're getting there is what you want to do is not just live frugally, baked beans and white bread. What you want to do is live frugally and then use that money and put it to work for you. And so you're not eating, you know, baked beans on white bread. You're eating caviar on whatever you like, caviar on. [00:16:02][21.4]

Ren: [00:16:04] So I think for me, it's speaking from personal experience, what I would love to be able to do. And part of the reason why I am investing and trying to put as much money into the market early in my career as possible is I would love for money not to be a key factor in my decisions. I don't want to stop working at 40 and, you know, lie on a beach for the rest of my life. I think I'm the kind of person that will want to work, but I don't want to chase that paycheck. I don't want to have to keep trying to get pay rises from my employer having money put away in the markets, earning you dividends and growing over time. For me, my dream is then to be able to take a lower paying job if it interests me more to be able to travel, if I want to, to be able to stop working for a while. If I've got a side project like this podcast that I want to spend more time on. It gives you optionality. And that's the thing that's really attractive for me. It doesn't have to be about maxing out and retiring and telling your boss to get stuffed. It can just be about opening up the options that just relying on a paycheck wouldn't give you. [00:17:07][62.6]

Bryce: [00:17:07] I just want to touch on that point of frugality, Ren, because investing is not exclusionary to you know, you don't have to put all of your money into it. And we'll touch on this in the next episode when we talk about the sort of savings around investing. But, you know, you and I both don't live a frugal life because we're throwing all of our money into investing. One of the great things that with technology at the moment is that there are many ways that you can start investing. So by all means, if the fire movement is for you, then great. But it doesn't mean that you have to live on skin and bone for 20 years to build the wealth that you're talking about. You know, it's all about having a consistent strategy, being disciplined about it. And we will get there in the end. So don't feel like if you want to start investing, it's going to break your bank account and you're going to need thousands and thousands of dollars to do it. That's not the message that we're trying to give, and it's certainly not the case. [00:17:58][51.1]

Ren: [00:17:59] I mean, I started investing when you started investing is, what, a eight year old or something. So and I started investing as a uni student that was working a part time job. [00:18:10][10.7]

Ren: [00:18:10] I think I was working in a furniture warehouse at that time, building high office furniture a day or two a week. [00:18:17][6.7]

Ren: [00:18:17] So it's not about being the investment bank graduate who has had a fair bit of money to throw in the market. It's never been more accessible or cheaper. So I think the last thing that we may have touched on, but it's it's probably worth talking about. Absolutely. Yeah. You don't even know what I'm going to say. [00:18:36][18.8]

Bryce: [00:18:36] I can understand. [00:18:37][0.7]

Ren: [00:18:38] I know who you is about the way that learning about investing helps you understand the world better. It introduces you to so many new companies, so many new industries, so many new concepts and so many interesting people that you wouldn't otherwise know about or learn about. And it's just a really interesting snapshot of the economy and I guess the broader world. [00:19:00][22.6]

Bryce: [00:19:01] And to that point, Ren, a lot of people often come to us and say, I don't know enough about it to get started. Where do I start? What information should I be using? And to your point, it's not until you get stuck in that you start going down all these rabbit holes and learning on the journey. So it is once you get in there, it's a fascinating world to get into because as you said, it really opens up your eyes to industries that you would never be reading about, thinking about companies in ways that you never would be thinking about, like where we'd go out for dinner or we'd be walking down the street and shopping in Coles or Woolies in the way that we just think about those businesses in our day to day experiences from an investing point of view, we would never do if we had never started this sort of journey. So I love it. And it really challenges the way we think about things. And a challenge in itself of finding good companies is quite exhilarating and exciting at times. So I guess my message for this part is that, you know, don't feel like you need to know at all because it will come and you essentially fall in love with it. [00:19:59][58.3]

Ren: [00:19:59] Yeah, and we definitely don't know at all. No, I definitely don't. [00:20:03][3.4]

Bryce: [00:20:05] I think there's a bit more than me but thats ok. [00:20:06][1.5]

Ren: [00:20:08] I also think it's really one of those things. The more you learn, the more you realize that you don't know. Yeah. And if you are listening to a financial advisor or a investing podcast or a YouTube or whatever it is, who says they know it all and they can give you all the answers. They probably don't know enough or they're not being entirely truthful. It is literally world where you could always be wrong. Like the best investors. The world are constantly wrong. Warren Buffet has made some shocking trades of late. No. One that's 100. Yeah, yeah. Except for Steve Smith. [00:20:42][34.0]

Bryce: [00:20:42] For those of you who are very new to the world investing, Warren Buffett is arguably the greatest investor of all time. Still alive, still kicking in in his 80s. He has a company called Berkshire Hathaway worth billions and billions of dollars. [00:20:55][12.7]

Bryce: [00:20:56] He still to this day is challenging himself in the way he sees the world few imagined when he started investing, what, 50 years ago. There was no iPhone. There was no technology. He was investing in railroads. And, you know, he said he would never invest in airlines, he would never invest in technology. And now he owns Apple and a multitude of airlines in the United States. So he's still on his journey of investing and he's the one of the best in the world. So I guess to close this episode out, Ren, I think our message is a just get started. Don't be afraid, because if you think you're going to be waiting for the perfect time, kind of like having kids, I guess there's never gonna be the perfect time on your mind. [00:21:31][35.1]

Bryce: [00:21:33] Never going to be the perfect time. [00:21:34][1.3]

Bryce: [00:21:35] But we've alluded to the fact that time is on our side. So the earlier you can start by all means, the better off you will be. You will learn as you go. So don't feel like you need to have a checklist and a playbook in front of you before you kick off, because for reasons that we'll talk about later on in this series, that's not probably the best way to get started. Just get started. [00:21:54][19.7]

Ren: [00:21:55] Hopefully the last 20 minutes has convinced you to give us the next twelve episodes of your time and get started investing. What we want to do over the next twelve episodes is break down all of the key sticking points to getting started. We're going to break down the jargon. We're going to talk about how you actually make a trade. We're going to talk about how how you make that first investment, what you should look for, what you should not, why you're not going to tell you what to invest in. We're gonna give you the tools to help you make that decision yourself. Yes. And then hopefully by the end of this 13 episode series, you'll be ready and you'll have the skills and the knowledge that you need to get started. Start your investing journey and then we'll still be here. You can come and join us as we continue our investing journey over our flagship show, as you named it, for the first time. [00:22:39][44.4]

Ren: [00:22:40] I've heard it called that. We'll go with it. Our flagship show, the original podcast, Equity Mates. [00:22:45][5.4]

Ren: [00:22:45] Yes. So hopefully we help break down those barriers and help get you started. [00:22:50][4.2]

Bryce: [00:22:50] Absolutely. So head to equity mates, dot com for more information and join our community. We're on Facebook. We're on Instagram. We're on Twitter. [00:22:57][7.2]

Bryce: [00:22:58] You'll find us all at equity mates in our podcast, Slim Millennials, who are doing a podcast every week on the air as clichéd as they. Ren doesn't know the log ins to any of our social media. He doesn't take an interest. So if you're looking to cut him arteriogram, I'll give you his number. I can text him to actually have a landline and a fax number. That's the way I like. [00:23:21][23.2]

Bryce: [00:23:23] So Ren always good to be chatting stocks and markets with you. I think hopefully, as you said, we've managed to break down the barriers to the markets and made it a little bit easier for everyone to get started. So thanks for last 20 minutes. Really looking forward to continuing with this series. [00:23:23][0.0]