The Chris Voss Show - The Chris Voss Show Podcast – The Wannabe Investor: 40 Must-Know Facts Before Buying Your First Stock by Ann Marie Sabath

Episode Date: June 24, 2024

The Wannabe Investor: 40 Must-Know Facts Before Buying Your First Stock by Ann Marie Sabath https://amzn.to/3VWS6uH Annmariesabath.com LET THE WANNABE INVESTOR BE THE KEY TO UNLOCKING A BRIGHTER FINANCIAL FUTURE FOR YOU! Do you find the stock market intimidating? Does the thought of losing your hard-earned money hold you back? Do you think you don't have enough time to dedicate to investing in the market? You're not alone! A staggering 40 percent of Americans shy away from investing in the stock market due to a lack of knowledge, funds, or confidence. In this groundbreaking book, Ann Marie Sabath, a former wannabe investor turned diversified stock owner, shares her wealth of knowledge to empower you to enter the world of investing one step at a time. Sabath's writing style is refreshingly down-to-earth, making even the most intricate concepts easy to grasp. She shares the essential pre-investment steps, ensuring you have a solid foundation before buying your first share of stock. She explains the seven excuses people make for not investing, how to identify your risk tolerance level, the power of compounding, the one-hour-a-year investment strategy, and much more. The Wannabe Investor isn't just another dry investment book. It's a transformative guide that reveals the strategies that self-made millionaires use to build wealth. Don't let your hard-earned money languish in low-yield savings accounts or slow-growing bonds any longer. You will be ready to take control of your financial future after reading The Wannabe Investor.About the author ANN MARIE SABATH is the author of ten books, including the best-selling “What Self-Made Millionaires Do That Most People Don’t.” Her passion for investing was ignited during her ten life-changing years under the guidance of a seasoned stock market guru. Inspired by his six-decade fortune-building journey, she developed a keen understanding of investment principles and practical choices, which allowed her to build her own substantial nest egg. Today, Sabath dedicates her time to empowering individuals to create their own success through the content in “The Wannabe Investor” and her other books.

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Fortress Chris Voss We had an amazing young lady on the show today. We're going to be talking to her about her new book, Hot Off the Presses, April 1st, 2024. It's not an April 1st joke. It's called The Wannabe Investor, 40 Must-Know Facts Before Buying Your First Stock by Anne-Marie Savith. She'll be joining us on the show to talk about multi-books that she's taken and written. She's the author of 10 books, including the best-selling, What Self-Made Millionaires Do That Most People Don't. Her passion for investing was ignited during her 10 life-changing years under the guidance of a seasoned stock market guru.

Inspired by a six-decade fortune-building journey, she developed a keen understanding of investment principles and practical choices, which allowed her to build her own substantial nest egg. Today, she dedicates her time to empowering individuals to create their own success through the content in The Wannabe Investor and her other books. Welcome to the show, Ann Marie. How are you? Great, Chris. How are you? I am excellent. It's just wonderful to have you as well. Give us a dot com so we can find you on the interweb, which is in the sky. Thank you. AnnMarieSabbath.com. And if they put in my name, Ann Marie Sabbath, on Facebook, LinkedIn, Instagram, X, they will find me.

There you go. So give us a 30,000 overview of your new book. My new book is for the 40 percent of americans who are not invested in the market and that's why i called it the wannabe i'm a real expert because i was a wannabe until 10 years ago when i did not know how to invest in the market and so i had my money in a savings account and under the mattress. Under the mattress. Does that sound like the right place to put that?

It was very lumpy. It was very lumpy. It sounds like a good load that was in there. So what motivated you to want to write this book? What was the proponent behind it? You've written nine other books. Yes, my proponent for writing books is to teach people what I did not know. And in this book, I was stunned when I saw that investing is strictly a language. It's a language of investing. People throw out these 50 cent words,

and I did not understand them, even though I'm multilingual after seven years of studying under this guru as an individual I wasn't getting any type of designation I wanted to learn it what I realized is that anybody could learn it they simply need the knowledge in down-to-earth layperson's terms and yes and that's how I did it and And so it took three years to write because I wanted it. I wanted it correct. I wanted people to be able to understand it. I had several beta readers to say, what didn't you understand? What do you like? And so that's how it came about. Nice. Tell us a little bit about yourself. How did you grow up? What was

kind of your origin story? How did you know you become a writer and, of course, start writing all these great books? Chris, I love telling people what to do. That's the bottom line. Anybody who knows me will agree. She's honest, ladies and gentlemen. And so for that reason, I founded a business consulting firm. And if you can imagine, a 33-year-old etiquette firm. I went around the world for American Express Bank, for many organizations to help people, to help their

teams enhance their client relationship skills. And I did that. I began an etiquette program because I really did not know. I came from a very red-blooded family. I'm not, there's no blue book. I hope so. Well, and that's a big thing. And so what I did is every time I decided to write a book, it's because I had figured out, I had learned, I had taught people, I saw a need. And so that's what happened. And so going from an etiquette, six etiquette books, Domestic and International, to other books that go one minute manners, how to handle awkward situations,

to what self-made millionaires do. I wanted to know what self-made billionaires did. And so I interviewed people, and I figured out it's really not about the money. It's about the habits. This is how it came about. This is why I write. I write to help people create their own success and create passive income, certainly in the wannabe investor. There you go. So what are some examples? You know, I've heard things like,

you know, you hear things on TikTok memes and other things. You hear that, you know, millionaires, true millionaires, you know, they'll drive like older cars and they'll drive, they're very, you know, they're not up to debt in their hawk. You know, you don't see them driving the newest cars. Is that true? You know what? It depends what they're, a lot of people still have their communion money or bar mitzvah money. Sure. If they're self-made millionaires, billionaires.

However, there is a time to enjoy your money because let's face it, coffins don't have pockets. Hmm. Coffins don't have pockets. Yes. And you know what? I like that line. Chris, you're welcome to use it.

And the deal is this. If you don't use it, I guarantee you, your children, your grandchildren, your great-grandchildren will. And so along the way, why not enjoy your money?

The key is getting to the seven figure status is a matter of being aware of what you're doing. So many people who, and I love designer clothes. I've had the fancy schmancy cars. However, the key is people who have it, and I learned myself. Once I finally got, I added that extra zero to my life, I realized because I can have it doesn't really mean I want it. It's really the face, not the catch.

There you go. There you go. What are some other aspects that millionaires do that are different than others? If you can tease them out, maybe. I will tease them out. Number one, they document their goals. They know where they're going and that's why they get there. That's a big deal.

Yes. I mean, you have to plan not to fail to fail not to plan. Isn't that a novel idea? What an idea. And here's the deal. Approximately one-third of people know what they want to do. However, very few people document their goals. When you know what you want, that you're one third of the way there. When you document your goals,

you're two thirds of the way there. And then the rest happen because of your subconscious way of doing things, because of call it whatever you want. The universe. Chris, I've gotten anything I've ever wanted in my life and I was not a trust fund baby. I manifest, I document my goals all the time. And one of them was being on your show. How did that happen? Whoa. We have manifested a goal. You did ask her. We asked her one of the two, but you're here. That's all that matters. You know, manifesting, planning, doing all these things that are important can do this. Now, your book is entitled The Wannabe Investor. Is it still okay for people who, you know, you have 40 must-known facts. Do you want to tease a few of those out? I'm happy to. Number one, get over this business about not believing that you can invest.

There are six reasons that people actually don't invest. And I will tell you, I had every one of them. Number one, I did not have student debt. However, so many people believe that they should not invest in the market because of student debt. Two years ago, they had to stop using that excuse because there's actually a secure SEC URE secure 2.0 act that was passed on legislation and when people pay toward their student debt their organizations can actually fund a retirement their retirement plan based on a certain percentage so no excuse at all they

think they don't have enough money to invest. There are many, many brokerage firms who will allow you to put in a minimal amount. It doesn't matter what. It can be $100. You don't need $1,000 or $50,000. That's a big excuse. Another one is they don't know how to open a brokerage account. You know what? The wannabe investor has an entire chapter in there, and there are many online sites that can actually teach you. People believe that they should have their money in liquid assets, like their checking account. It doesn't even keep up with the cost of inflation, so they're actually losing money. And so I'm saying these are reasons that people choose not to invest. They don't know enough about the market. That was my excuse.

I didn't trust people because I really needed to know the hows and whats and wheres instead of someone speaking this fancy schmancy language. And so this is what it's about. And the last is people believe that investing is a form of gambling

and they're right when they don't do their homework first. Okay. Yeah. Yeah, you got to do your homework hey you can't just like throw money at things what are your feelings about like bitcoin and some of these cryptocurrencies do you feel they're good investments for people or do you talk about that in your book there's an entire chapter on cryptocurrency now again everyone cryptocurrency. Now, again, everyone has to do what's right for them. My recommendation is you buy what you understand. I do not understand enough about it. And so I'm stepping back. I listen. I read articles. I listen to the experts on cryptocurrency. However, again, I don't

understand it. And so I invest in what I understand. You know, I mean, it's an interesting marketplace. Let's just put it that way. I just found out I was going through cleaning up my Facebook yesterday because I'm full of 5,000 members. Turns out I friended Sam Binkman-Fried he friended me back like in the 2010s. Friends the whole time. I wished him happy birthday a couple of times and probably talked to him. Anyway, I should have warned him about his future.

I feel bad now. So probably my fault. But yeah, you got to understand what you're investing in, what you can do. Why is it important? Should everybody be in the market at this point or in some sort of investment for the future and why? Absolutely. And when I say that, here's the deal.

Before you even think of investing, you have to fund your 401k or your Roth IRA, depending on where you are, if you're with a corporation or you need to create your own. The most important thing is to invest in a retirement fund and max it out annually before you even think of investing. The second thing before you even think of investing is to have a minimum of three to six years of an emergency fund. Now, come on, let's face it. We've all been there. We've all said, are you kidding? Three months of an emergency fund? You don't have to do it tomorrow. And people believe, Chris, that they need to get a raise. It's not how much you

make. It's what you do with it. If you're going to go out to dinner five nights a week, guess what? You can put some of that toward an emergency fund. The key is there are so many things to do to manage what you have rather than saying, when I get paid more. That's the bottom line. There you go. If you fail to plan, you plan to fail. That's the axiom.

I finally remembered how I clearly didn't plan it well, so I failed at it. Now, you build this as not just another dry investment book. What keeps it from being dry? It's certainly not dry because I give examples, and I'll give you one. When I studied, and I'm still studying with him. I actually live with him, but don't tell anyone. So now here we are. We evolved from learning about investments to a very healthy relationship.

What happened is it's not dry because when I asked him to tell me about bonds, he said, I'd much rather talk about blondes. So if that gives you a clue about it not being dry, there we go. Wow, this sounds like a steamy book then. I don't know, what are you gonna do? But you know, if investments can help my love life, I need all the help I can get.

So there you go. Yes, it would help. It helps everyone's love life because first of all, you are secure. You're a nicer person. You're a better person. You're less stressed because you are in control. You have passive income little by little by little. It's not a matter of there's no quick fix going on. This can get me the chicks then. So your book helps people find the stock market less intimidating or not intimidating. Tell us about that. The key is you have to read it first.

That's number one. Number two, yes, that's a surprise. What kind of book is this? I don't know. What are we going to say? You can do it on audio too. However, the key is I'm truly fascinated by it. Maybe I've turned into a boring person. You wrote it, so you should. Thank you. I really believe in this. I'll give you an example. People ask, what shall I buy? And I ask them, you have to determine if you are a low risk, medium risk, or high risk

person. There's not one size fits all. And so that's important when people want to understand what a stock is they have to ask themselves in what sector is it do i have that that sector am i diversified it's very important does the stock have a moat chris do you know what a moat is when it comes to a stock no well let me tell you i didn't either and most people didn't until the mid 90s when warren buffett who's quoted in this book 18 times and he does have a copy of it when he went to columbia university and talked to a finance a group of

students and the professor whose name is greenwald asked Mr. Buffett how do you decide what stocks to buy and he said I only buy stocks that have a moat m-o-a-t the professor asked what's that and he said a moat a stock with a moat has a competitive advantage over other companies providing that service or product from the standpoint of does it have a competitive advantage over other companies providing that service or product from the standpoint of does it have a network advantage? If you or I have Apple, an Apple phone, of course it has a network. We can connect with our iPads, our watches, et cetera. That's a network.

Is there a high switching cost? If we even think of switching and going from an Apple to another provider, it's going to take a lot of energy. So that's called, does it have high switching? Does it have brand recognition? Absolutely. Are you kidding? This is like an Oprah Winfrey. We don't need, it's Apple.

We don't need a lot going on. Does it have a high barrier to entry? That means, you know, what is this that it absolutely is fine? And does it have intangible assets? Think of all of the intellectual property that a stock with a moat like Apple has. And so what I'm saying is when I buy stocks, I only invest in a stock with a moat. I don't simply buy it. If I hear a talking head on CNBC, which I love, on Fox, which I love, I don't run out and buy it. I do my homework.

I do my research. And that's what it's about. And so it's really a language. If you're going to decide to go to Paris and want to be fluent, you don't do a parlez-vous Francais and oui, oui, and then you're off. You need to learn the language fluently. And that's what this book is. It's for everyday lay people who are non-financial.

There you go. Non-financial. You help people also overcome anxiety about losing their hard-earned money and holding themselves back. How can people navigate that where they're like, you know, I think that's probably the about losing their hard-earned money and holding themselves back. How can people navigate that where they're like, you know, I think that's probably the one trepidation people hold back on. God, I don't want to bet my money in the stock market because what if I lose it all?

That's right. First of all, they need to have what we talked about, have their retirement fund maxed out each year and have a minimum of three months of an emergency fund. And I'll give you an example. I'm heavily invested in a particular stock. I won't name it. However, it begins with an N and ends with an A and it has a lot of potential. It's an AI stock. And today, I know where it's gone. And I'm very happy because it's a great time to do contrarian investing. When a stock goes down, if you believe in it, if it has a moat, if it goes through, if you've gone through the criteria, why not buy more or sit tight? People need, let me say this, Alan, who is my investment guru, says in the book, this is one of the 40 Alanisms,

choose a stock like you choose a mate. Long term. Long term. So long term mate. Not somebody you pick up at the bar for one night stand, right? Those are fun too, aren't they? I've been so many decades, I don't remember. However, yes, that's what we're talking about.

There you go. Yeah, I mean, there are some people who are very sloppy about how they pick their maids. You know, be wise, folks. That's, I guess, what I can say. You can write that book, Chris. I'm not. Yeah, I probably could because I've seen that movie a couple times. So there you go.

What else have we talked about in your book that people should know about? There are many things that people should know about. The key is surround yourself with people you want to be like. Learn something new every day. And what that means is even before you invest in the market, ask yourself, what am I going to do? Are you going to turn on a financial channel when you get up and listen to it? Is there a favorite podcast that you should be listening to? Is there a digital newspaper, whether it's IBD, whether it's the journal?

It doesn't matter what it is. However, it's essential, like anything else, to learn. A very important thing is also, and many people do this in their retirement fund, is to do something called dollar cost averaging. That's real easy. That means every month you have a certain amount pulled from your paycheck, whether it's $10 or $100, and that goes directly into your retirement account. Chris, there's something I bet your listeners would love to hear. You know you're never too young or never too old to invest in the market? Oh, really? Wow.

Definitely. I'll give you an example. So many people do fund accounts for children toward college. And what I do is I happen to have two grandchildren. They get no more toys. They get no more clothes from me. Four years ago when they were 7 and 11, I happen to have two grandchildren. They get no more toys. They get no more clothes from me. Four years ago, when they were seven and 11, I said to them, you are going to be wealthy women someday. And so you're going to get one share or maybe a half a share.

That's called a fractionated share of stock for every birthday and every Christmas. Guess what? They have 19 stocks representing 11 business sectors with a charm bracelet, with an Apple stock, with a plane for GE, with a Starbucks cup, all in sterling silver. And so you're never too young to invest in the market. And I will give you something. The 11 year old said to me a month after she had the stock, she said, Disney stock is going up. And I said, how do you know that? She said, because we went trick-or-treating and all of these kids were wearing Disney costumes. Wow.

My point is you can teach people, kids early by being aware. Look at all the toys they throw in the closet, the clothes they outgrow. So you're never, ever too young to invest in the market. There you go. Would you adopt me, please? Yes, Chris. I needed a younger brother. I have investments you can set me up in and you can use me as a dependent, I think. I'm not sure how that works. So there you go. This is very insightful. I mean, it's good for people to know to invest. People need to realize that these are important. And it seems like, are we at a lowest point of people investing in the market than ever before? Are we starting to see more people move into the markets? Where are we in the world with

people investing and what needs to improve, I guess? Strangely enough, when I wrote this book, I wanted to know that fact. And during the past 10, 20 years, you have approximately the same number. So you have this, when I'm saying approximately 40% of Americans are not invested in the market. That number ranges one, two, maybe 3%. And I've seen that over by the research over the past few decades. I'd like to share one more thing because we may have somebody listening who may be 60, 70, 80 years old. And I want that person to know that you're never too old to invest in the market. You don't just jump in. You need someone. I'm going to give you an example. There was a woman

in the last chapter of the book. Her name is Stella. And that's not her real name, of course. She was told that 80 is the new 60. And she panicked. And the reason she panicked is she said, I don't have enough money to live another 20 years. What am I going to do? Seriously. And so what she did is she happened to talk with someone who is a friend in the retirement center. And he said, listen, this is what I do. I took a certain percentage of what I have, and I have invested it for 10 years. And these were the three criteria. One, invest no more than 10% of your assets in the market. So she did 10%. Diversify by having your stocks in different sectors. And the last thing is keep it a minimum of 10 years. Guess what? She did that. She did exactly that. And you see in the book that at the end of 10

years, she ended up with the 10 stocks. Some went up, some went down. However, they averaged 4.7 something percent, which was much better than she was making in her savings account. Now, that doesn't count taxes. That doesn't count the dividends she may have made. However, the key is be aware. Be aware. Plan. Do something.

I mean, doing something is probably better than doing nothing, right? If you don't know what you're doing, it's probably better to do nothing. You have to be educated. You have to educate yourself. There is no one size fits all when it comes to investing. There you go. That makes for an excellent point, which seems to be a point throughout your book. Know what you're doing as opposed to just throwing money out the window and hoping that it works, which is how kids are raised. Chris, what is the one takeaway you've picked up? If you fail the plan, you plan to fail. And that's the big thing.

You need to set goals. You need to plan what you want to achieve. You invest in something you understand, knowing what you understand. I've seen so many people over the years invest in stuff they don't get. I saw that with the 2008 crisis. I had friends that were buying homes that were $1,000 to $1,500 over what the rental market would pay that they were buying. And that was the negative AM starting price at 0% down. So that thing was going to skyrocket.

And I'm like, you've bought yourself out of the market. You can't even make your mortgage payment because no one will pay that rent. And they bought six homes that way. And I remember one friend, she lived in LA, Orange County, and someone told her to get into investing and Bakersfield was the best place for it. So she bought multiple homes in Bakersfield, which was four hours away or two or three hours away, which makes it really hard to manage rentals. And, you know, it's just silly stuff like that.

And then the funny part was she never bought her own place for herself. She's still renting an apartment. And I was like, you bought six properties and you didn't buy one for yourself? That might've been a good idea. I don't know. Be prepared, understand what you're investing in, because if you don't, you're going to find out the hard way, I imagine, right? Absolutely. And again, investing is for everyone. It's not for the 2% of individuals who have so much that they are influencing the market. In fact, because of what happened with AMC, went through COVID,

do you know that Wall Street looks at retail investors and looks at what they're doing? And rather than, and I don't mean rather than, however, they take a good look at them in addition to institutional investors have a retail investors have a lot of clout and that's you and me self-directed individuals now many people wonder should you have a financial advisor there's an entire chapter on that and the answer is absolutely if you don't have the time at least make sure you consult with an event a financial advisor once a year or if you don't want to have

anything to do with it read the book the wannabe investor so you understand what the person is saying so you can ask questions rather than agreeing there you go you've got to ask the right questions, know what you're doing, and all that good stuff. So final thoughts as we go out and where people can pick up the book. They can buy the book on Amazon. They can buy it virtually anywhere. Amazon, Barnes & Noble,

and anytime they have a question, I don't have anything to hustle. What I have is information to provide. They may email me anytime at annemarie at annemariesabbott.com. I genuinely care about people. And at this stage in my life, all I want to do is to help people create their own success. There you go. Thank you very much for coming to the show. We really appreciate it. This has been super insightful and we really love it.

My pleasure, Chris. It's an honor there you go folks pick up the book wherever fine books are sold the wannabe investor 40 must-known facts before buying your first stock out april 1st 2024 check out her other books that she has you can find them wherever fine books are sold go to goodreads.com fortress chris voss linkedin.com fortress chris voss if you want to buy me a cup of coffee you can go to buymeacupofcoffee.com, Fortress Chris Voss. And I love you because I think I'm drinking water right now. Thanks for tuning in. Be good to each other.

Stay safe. We'll see you next time. There you go.