Stock Investing Tip # 1: Treat All Financial Advisers & Stock Brokers Tip as Caveats

Financial advisers earn money when you buy an investment product. A 40% commission from the life insurance + mutual fund combo will give him a steady stream of income for as long as you continue to pay the premium. Stock brokers earn money when you buy and sell a stock. The more frequently, the better.

If you can see the problem here, that's good. You don't need this tip. But if you don't, let me tell you why...

Financial advisers and stock brokers are here to help you know where to put your money. But they earn money not on the percentages of the profit. They earn on the action you make. Your profit is irrelevant. They will earn either way. So if you win, they get money, if you don't, they still get money.

If a financial adviser or stock broker told you a tip where to invest, a VUL or a stock, always treat it as a caveat. There is no risk for him if he told you to invest here and there. But there is risk to you. Always, always remember that everything is an opinion. And everyone has their own interests. A financial adviser to meet a quota, a stock broker to make you trade frequently. None of those to make you rich.

That job falls in your hands. Its your job to profit and only you have that determination to make yourself profit in the market. I won't see stock brokers and financial advisers take a bullet for you just so you could profit. Or give you a money back for the money lost in your (or his) investment decision.

I'm not writing this to bad mouth financial advisers and stock brokers, I'm writing this for you, dear investor. Its your money, though many people seem to forget, we used to research for weeks to find the right refrigerator, but the decision ultimately comes to us when it comes down to it. Should we buy? Should we look for another one? Does this refrigerator benefits me in the long term? If we could only look at investing the same way.

Financial advisers and stock brokers have services to provide for you as an investor. They are there to help you meet your ultimate aim to profit in the market. Treat the financial adviser as you would treat a saleslady in the mall, she's there to tell you and help you about the product you want to buy and how they will benefit you. Treat the stock broker as the lady teller in your local bank, helping you with transactions such as depositing and withdrawing. Treat them with respect. But once you see them as someone who knows the key to wealth, you are in a very rude awakening... That key is you. Don't look outside. It is in your power.

How Do You Teach Someone To Invest In the Stock Market?

Teaching someone investing is different from teaching someone how to invest in the stock market. The first one is a general overview of what investing is, it could be real estate, stocks or buying jewelry. While the 2nd one is more specific and will determine the character and personality of the investor.

The hardest question for me to answer is when someone asks me, how to invest in the stock market. A life insurance agent will love this opportunity to sell an insurance product that has investment and retirement plan in it, earning himself a 40% commission in the process. But I'm not a life insurance agent and I definitely won't invest my money in insurance products.

I also don't like the 1 day seminars conducted by a lot of organizations on how to invest in the stock market. I think, that is a bit misleading. It takes me weeks to find out what's the best computer laptop to buy, it takes years of accumulated knowledge to know which specification is right for my needs, yet people seem to think that attending 1 day seminars would automatically make you an expert in a field that few of us can only master... or make profitable.

I do believe that these seminars have value. And I am not entirely against them. For example, teaching someone how to navigate an online stock trading dashboard would be a good seminar for 1 day. But teaching someone how to read charts or financial statements in one day would only do more harm than good for the investor  (but more good than harm to the broker, in terms of money). Since most people would actually study that sort of stuff in university for 5 years.

And I'm also not against insurance companies selling investment products. They are actually good, given some circumstances. But the bad news about it is that when sales quota comes first, the investor's welfare is not the #1 priority. Remember that these are salesmen, and you have to think twice before investing. They have a commission, a quota and are ambitious in pursuit of money. Your returns is probably not the first thing in their mind. Its probably their own retirement.

So how do you exactly teach someone how to invest in the stock market where financial advisers are salesmen and seminars are not enough?

Hmm... that is a big question mark and I still don't know how to answer that. When someone asks me, it always leaves me speechless. Trying to think of things to say.

How did I learn to invest? Books. But given most people are afraid to read books, I don't think I have an answer for that. What if the insurance salesman wrote a book? Reading what kinds of books is another question. But its a lot easier to answer.