Why I Really Started Gen Y Wealth

by RJ

in Random

Five years ago now, I graduated from Eastern Illinois University. Upon leaving, I went to work for my family’s business, Weiss Insurance Agencies. An insurance agency started by my Great Grandpa over 100 years ago.

Since I decided to go to the cheapest in state school to get my degree, I was fortunate to graduate with no debt. Besides having no debt, I also lived with my parents for over a year. On top of living with my parents, I had a second job as a high school basketball coach.

With little monthly expenses and two jobs, it wasn’t long before I accumulated a nice amount of cash for someone my age.

Of course the first thought that came to my mind is that I should use this cash to get rich in the stock market.

The first place I went was my dad’s investment adviser. I went to adviser’s office one day and we talked investing for 30 minutes or so. At the end of the session, I wrote him a check so I could get started.

I had graduated with a finance degree and had read a few books on beating the market, so I thought I knew what I was doing. The adviser recommended a mutual fund or two, which I put about 50% of my cash in. The other 50% was my get rich fund, earmarked for individual stock selection.

I actually didn’t do that bad. I owned Apple, Costco, Google, Amazon, Whirlpool and a few other individual stocks.

The problem was that even though my stocks and mutual funds were doing alright, my account balance wasn’t really increasing. After a closer look, I saw that taxes and fees were taking away all my returns.

Thinking back to when the adviser explained to me the fees when we first sat down, I thought this was just what to expect. After all, I was referred to this adviser through my dad.

Lucky for me, I continued to learn about investing, after I made my initial stock selections. One day, I think it was reading a post on The Simple Dollar, one of my favorite personal finance blogs, I heard about the work of John Bogle. More specifically, I heard about this book called The Boglehead’s Guide to Investing.

I saw that it had had some good reviews on Amazon, so I ordered it.

After it arrived, I couldn’t put it down. It opened me up to a whole new world of investing. A much simpler and better world.

The Bogleheads taught me about index funds, Roth IRA’s, mutual fund turnover, taxes, different types of investments, the power of compound interest, the benefits of having a net worth mindset, etc…

It really opened my eyes, as to what investing really is.

Soon after reading, I moved my assets to Vanguard and started investing in index funds. Not surprisingly, after the making the switch I noticed that my portfolio was actually going up.

In the next year or two, my sister, brothers, and friends seeing how passionate I was about this subject, started calling me and asking for help. So I sat down with them and explained investing, 401(k)s, Roth IRAs, index funds, etc…

It was that time that I knew there was a market that was in need. My feeling was that if people got the right advice when they’re young, they wouldn’t need it later.

So I started Gen Y Wealth.

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{ 6 comments… read them below or add one }

Pat S.No Gravatar February 4, 2011 at 10:39 am

That rings very true! Unlike you, I didn’t start out on such solid financial footing, but as I started learning more about investing and personal finance, my passion for sharing what I learned through my mistakes grew, and I have become a huge consumer of personal finance knowledge and a great advocate of conservative, long term investing and debt free living. After spending hours and hours talking to people about these very subjects, I also started writing my thoughts in “blog” format and have really enjoyed my first month or so of becoming involved in the online community of personal finance blogs.


EricNo Gravatar February 4, 2011 at 3:47 pm

This is a great story, and it inspires me to look into Bogle’s book!


CalebNo Gravatar February 4, 2011 at 5:16 pm

I started my blog for very similar reasons. I want to help other people understand more about finance and teach them what I have learned in the last few years. I will be linking to your post today in my Week Links post. It is great to hear from bloggers about what it was that made them start writing publicly.


PatrickNo Gravatar February 4, 2011 at 9:30 pm


What’s some crazy is that you also just hit on a point my dad shared with me a long time ago: You buy insurance from the insurance guy and investments from the investment guy but you never buy both from the same guy.

I am sure the advisor your dad recommended is a good guy, but last time I checked Goldman Sachs was not in the business of selling insurance, they are in the business of making money and selling investment opportunities.

I agree that there needs to be a new voice, that the financial mantra of two decades ago no longer apply as to much as changed. I don’t agree with people who say you should buy and sell everyday, the fees alone will kill your return, but maybe buy and hold for ten years is not working anymore either.


John HunterNo Gravatar February 6, 2011 at 5:06 pm

Bogle provides great advice for most people. Owning individual stocks though can be great. If you owned Google and Amazon over that period you would have made a lot of money (I know – I did). Apple would probably have made even more – I never bought it :-( (other than as part of index or mutual funds). And I would imagine Costco did well too. And the expenses can be extremely low (less than $10 a trade – and there is no reason to trade often at all). Here is my long term portfolio. http://curiouscat.com/invest/sleepwell.cfm

I would recommend index and mutual funds with low expense for a large portion of a portfolio, but individual stocks do not have to have high fees involved at all. And they can help people really learn about investing as they learn about what makes stocks valuable and go up in price.


RJNo Gravatar February 7, 2011 at 10:50 am

@John Hunter – I should have made this clearer, but I had invested in a few more companies that I have forgotten by now. Like most investors, I only remember my winners.

I was also trading and selling a lot, which really adds up when your only investing a small sum.


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