DMD 008: Everyone Likes a Good Sale!
The stock market goes on sale too. Investing when stocks of great companies are down is the key to creating significant wealth over time.
Welcome to issue #008 of DMD.
We all love buying things on sale like clothes, groceries, furniture, shoes, travel, etc. One of the greatest wealth creation vehicles of all time (the stock market) goes on sale from time to time too. Yet, when stocks go down or “crash” many let fear take over and stop investing. Or worse, they sell their stocks out of absolute panic instead of taking the rationale action to stay invested or buy more stocks that are now on sale.
Let’s take a look at the U.S. stock market performance history so you can see clearly what I mean. And when I say “stock market”, I’m referring to the S&P 500 index which measures the performance of the 500 largest stocks of publicly traded companies in a variety of industries.
Source: www.macrotrends.net/2526/sp-500-historical-annual-returns
The green bars you see above are up years in stocks and the red bars are down years. The amount of up years in the stock market is significantly greater than down years over the course of 100 years.
Those who know the power of compound interest from long term investing will invest more when stocks go down (on sale) or simply keep to their automatic weekly or monthly investing. We hope this is you when you see or hear that the market has gone down. Simply say, “so what, who cares” and stay the course. If you can add more to your weekly or monthly automatic investments when the market is on sale then do so as history tells the truth of what’s to come next - stocks going higher.
Weekly Market Update
The S&P 500 (where most of the stocks in your ETF’s and mutual funds are located) is down 1.7% as of March 24, 2025.
The Nasdaq (which has a heavy concentration of tech related stocks) is down nearly 5% for the year.
Overall, stocks performed well last week across all industry sectors.
Bitcoin trades around $88,000 so it’s down about 20% from its all time high (ATH) of $109,000.
Top alternative cryptocurrency coins Ethereum, Solana, XRP and Chainlink trade at $2074, $145, $2.46 and $15.46 respectively with the total crypto market cap just under $3 trillion - about $900 billion from an ATH.
Social Proof
Take a listen to ReSean McMiller share his enthusiasm for what he learned from a recent Do Money Differently live presentation in Phoenix, Arizona.
Money Moves
Create a zero-based monthly budget.
Traditional financial education is not working well in America so you need to learn how to budget your money better too. Many people don’t like the word “budget”. If that’s you then call it your monthly spending plan or monthly cash flow plan. Here’s what you need to do next:
Assign each dollar of your monthly income to 3 areas: fixed expenses, named savings accounts and your investment account(s) so that you have nothing left (zero).
For example, if you earn $2,000/month you need to tell each dollar where it will go or how it will be spent before the 1st day of the new month.
Fixed expenses include rent/mortgage, food, car payment, car insurance premiums, utilities, student loan payments, internet, cell phone, subscriptions/memberships (streaming, gym, software), etc. all to be paid from money in your checking account.
Named savings accounts include automatic transfers from your checking account into your named savings accounts like emergency fund, travel, entertainment, home down payment, clothes/shoes, car repair, furniture, education, new car or anything else you value or need in the next five years or less. Typically, you will only access this money once per month, if not for months or years.
Investments. Start automatic transfers into at least one investment account per week or month so you can begin creating significant future wealth for you and your current or future family. Even it’s only $10 per week or month be sure to have this in your budget.
Do your best to assign all of your monthly income to an expense, savings account and your investment account(s).
You will know how you financially roll and feel more in control within 60-90 days when you create this new zero-based budget.
Most unnecessary and impulse spending is reduced when you tell each dollar where it will go before the first of each month.
Word of the Week - Asset
An asset is anything that has real value that you own. Examples include: cash, car (if no loan on it), house, savings accounts, investment accounts that contain stocks/bonds (personal, 401k, Roth IRA) and maybe the baseball card collection that your grandfather gave you! :)
To take it one step further, a liquid asset is anything you can convert into cash quickly. This includes: stocks, bonds, mutual funds, ETF’s and actual cash.
An illiquid asset is anything that is not easily converted into cash. This includes: your car, home, retirement accounts or an antique lamp from your grandmother.
Side Hustle Differently - Digital Marketing
A dynamic and lucrative side hustle for you to make an extra $500 - $1000 per month and eventually way more is freelance digital marketing. Given that many small businesses seek to enhance their online presence without the overhead of hiring a full-time staff, your skills in social media management, content creation, SEO, and email marketing can be offered on a freelance basis.
Here’s how you can get started:
Build Your Skills: Take online courses and obtain certifications in digital marketing disciplines such as Google Analytics, Facebook Ads, and content marketing.
Create a Portfolio: Start by doing some initial work for free or at a reduced rate for local businesses to build your portfolio and gather testimonials.
Market Your Services: Use social media platforms and freelance websites like Upwork or Freelancer to connect with potential clients. Networking in local business events or online forums can also be effective.
Deliver and Refine: As you onboard clients, focus on delivering excellent value and refining your skills based on feedback and results-driven metrics.
This side hustle not only offers flexible hours and good income potential but also builds valuable skills that can elevate a your career in the burgeoning field of digital marketing.
The DMD portfolio (stocks and crypto)
I share my personal investments of stocks, crypto and my sales or buys (if any) that I make each week with my reasons for those decisions. I automatically invest weekly or monthly into my Roth IRA, SEP-IRA and one of my personal investment accounts.
Stocks
ROTH IRA (held with Robinhood)
I own the following ETF’s: VOO (tracks 500 stocks that make up the S&P 500 index), VTI (total stock market that tracks 4,000 U.S. stocks) and VYM (tracks high dividend paying stocks).
I own the following individual stocks as late February 2025: Marathon Holdings (MARA), Robinhood (HOOD) and Tesla (TSLA)
SEP-IRA (held with the Acorns saving and investing app) - this is my 401(k) because I’m self-employed.
Vanguard S&P 500 ETF (VOO)
iShares Core S&P Mid-Cap ETF (IJH)
iShares Core S&P Small-Cap ETF (IJR)
iShares Core Total International Stock ETF (IXUS)
iShares Core U.S. Aggregate Bond ETF (AGG)
Personal investment accounts (Acorns, Robinhood, E*Trade)
Moderately aggressive portfolio (mix of stock and bond ETFs) inside my Acorns account along with individual stocks of Tesla (TSLA), Nvidia (NVDA), Stryker (SYK), Adobe (ADBE) and Visa (V). This is another long term investment account and I do not trade in this account because it does not allow you to (which is a good thing).
MARA Holdings, VXX and Money Market (cash) inside my E*Trade account. Another long term investment account and I do not trade very often in this account.
Basic tenet of investing in stocks - when you automatically invest weekly or monthly into solid growth stock ETF’s and mutual funds you don’t have to worry about the ups and downs of the stock market. Time, based on historical evidence of the U.S. stock market, does the heavy lifting of wealth creation for you. Stocks are your primary foundational investments to winning the money game.
Over the last 150+ years the U.S. stock market has given investors nearly 10% annual ROI. Over the last 50 years, the annual ROI has been closer to 12%. Fantastic annual returns that compound into significant wealth.
Crypto
Bitcoin (BTC), Chainlink (LINK), Ripple (XRP), Ondo Finance (ONDO), Internet Computer Protocol (ICP), Immutable (IMX), Render (RNDR), Parsiq (PRQ)
Basic tenet of investing in crypto. Crypto is a high risk/high reward asymmetric investment which means you can risk a small amount of money ($1000 - $2000) for the potential of higher outpaced gains than traditional investing in stocks. Taking the time to research and investigate new blockchain tech related projects/organizations that are being used for legit long term use cases and value for the world we live in.
Crypto is no different then if you invest into little known publicly traded stocks that are trading below $10 per share that you have conviction in. Knowing ahead of time, however, that you could lose your entire investment.
Community Engagement
New Partners
We are excited to have Acorns as our new presenting sponsor of the DMD newsletter!
I’ve been using Acorns as one of my investment accounts for years. With over 10 million users and growing it’s one the best ways for new investors (young and old) to begin investing into the stock market safely and securely. Their “Round Ups” feature is one of several wonderful benefits that Acorns delivers to its users.
Based primarily on your date of birth and answers to a couple of questions, Acorns will automatically put your money to work into one of five investment portfolios (ETF’s). You will own over 100 different stocks and bonds so you don’t have to choose the stocks/bonds yourself. Now that’s pretty sweet!
By clicking on the Acorns logo above you will also get a special $40 bonus as long as you set up at least a $5 or more weekly or monthly recurring investment. Automatic recurring investing is what we teach so it makes sense to set up a recurring investment and you can add more as your income grows.
Thank You!
For being a valued subscriber to DMD and choosing the path of financial rebellion to create a better life for you and others. If you like DMD - share it with others!
Todd