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How to Invest as a Teenager

2022-04-29 · Long video (solo, talking head or whiteboard) · Ali · recording, 22:26 · watch on YouTube

Topic: Money and investing (also: Business and entrepreneurship, Books and reading, Work and career, YouTube, writing online and creators, Mindset, motivation and happiness) · mode: List of tips or lessons · tags: Aimed at students, Lesson from a book, His own numbers, Sponsor segment present

In a Money Club episode, Ali gives five ways a teenager should invest money (spend on experiences rather than over-saving, open an investment account, put small sums into index funds and a little crypto to learn the process, buy books and learning) and ten ways to invest time, from a fastlane mindset, coding, writing and video production to a first business, passive income and outsourcing, ending with a call to enjoy the journey.

What is said

The parts of the video and what is said in each (★ — how much it matters to the video).

00:00:00 — Time billionaires; a Money Club episode on five ways to invest money and ten ways to invest time

  • ★★ Ali says that when you are young you are a "time billionaire", with loads of time but not much money, while with age we get more money but less time and more responsibilities. — 00:00:00

    “when you're young, you are a time billionaire”

  • ★ This video is an episode of Money Club, Ali's ongoing series on the principles, strategies and tools that help on the journey towards financial independence. — 00:00:00

00:00:24 — Money 1: the dangers of saving too much

  • ★★★ Ali's first money point for teenagers is not to try to save too much: never sacrifice fun experiences for the sake of an extra few dollars in the bank account. — 00:00:29
  • ★★ Teenagers should not save too much, Ali says, because earning power only rises with age, so £50 becomes a drop in the ocean, and the happiness from spending the same money falls significantly over time. — 00:00:58
  • ★★ Ali's second point is for teenagers to open an investment account, like a savings account that lets you invest the money in stocks and shares. — 00:01:27

00:01:39 — Money 2: investment accounts

  • ★★ In the UK and the US you must be over 18 to invest in the stock market as an individual, so a teenager needs a parent or guardian to open an account such as a junior ISA (UK) or a custodial account (US). — 00:01:56
  • ★★★ The point of a teenager's investment account, Ali says, is to learn the process of putting money into stocks and shares: he knows many people in their late 20s earning good money who never invested because it seemed a mental barrier. — 00:02:26

00:02:54 — Money 3: the power of index funds

  • ★★★ Ali's third point is to invest a small amount in index funds such as the FTSE 100 (the top 100 UK companies) or the S&P 500 (the top 500 US companies), which for most people is way better than picking individual stocks. — 00:02:55 · S&P 500
  • ★★ A teenager's $10 in the stock market will compound, but negligibly; the point, Ali says, is to get familiar with investing and into the investor mindset of putting spare cash into an index fund without a second thought. — 00:03:24 · S&P 500
  • ★★ To learn about crypto, Ali recommends Packy McCormick's email newsletter Not Boring as a great primer on all things crypto. — 00:03:53

00:03:57 — Money 4: crypto

  • ★★★ Ali recommends teenagers put a few dollars, not loads, into crypto such as Bitcoin or Ethereum through a safe, reputable platform like Coinbase, since it is still a fairly high-risk investment. — 00:04:22
  • ★★ Ali's crypto is split about 50-50 between Bitcoin and Ethereum; he does not bother with altcoins, calls himself not a very sophisticated crypto investor, and keeps some of his savings in crypto. — 00:04:22
  • ★★★ Ali recommends crypto to teenagers for its educational value rather than for riches: having skin in the game, money in Bitcoin or Ethereum, encourages you to explore it and take it seriously. — 00:04:52

00:05:19 — Money 5: levelling up with books and learning

  • ★★ With any spare cash left after experiences, Ali's fifth money point is to invest some money in books or learning. — 00:05:21
  • ★ As a teenager Ali pirated Adobe Photoshop; he is not proud of it and now pays full price for it. — 00:05:21
  • ★★ At 17 Ali pirated his first copy of Tim Ferriss's The 4-Hour Workweek, the book that most changed his life; he has since supported Ferriss's work through his sponsors and feels less bad about it. — 00:05:50 · The 4-Hour Workweek, Tim Ferriss
  • ★ Ali points teenagers to libraries, which have books available completely free. — 00:05:50
  • ★★★ Since the young have loads of free time and little money, Ali says investing money is a bit of a side hustle, while investing time is where they can make decisions that move the needle for their future. — 00:06:18

00:06:30 — Time 1: build a fastlane mindset

  • ★★★ To build a fastlane mindset, Ali calls The Millionaire Fastlane one of his favourite books about making money of all time and recommends it to teenagers and anyone else. — 00:06:47
  • ★★ MJ DeMarco (quoted): The Millionaire Fastlane says getting rich quick, meaning in under 10 years, is not necessarily a bad thing, while getting rich easy does not exist. — 00:06:47
  • ★★★ There is no easy way to get rich, Ali says, but the quicker ways generally involve building a business that provides large value to many people at scale, instead of the slow lane of a good job, university and retiring at 65. — 00:07:17

00:07:42 — Time 2: learn useful and in-demand skills such as coding

  • ★★★ Ali's second tip for investing time is to learn useful, in-demand skills; even today, he says, learning to code is still one of the best skills you can have. — 00:07:46
  • ★★ A 27-year-old Ali had dinner with the day before, who learned to code and did a computer science degree, earns $750,000 a year at a tech company in the Bay Area; Ali calls software developers' pay absurd. — 00:07:46
  • ★★ A friend of Ali who left school at 18 without university taught himself to code online and got a software developer job within a year, at about 80K a year as his first salary. (hedged) — 00:08:15
  • ★★ With Web3 booming, Ali says coding in Solidity or programming for the Ethereum blockchain, Solana or Polygon is a skill ridiculously high in demand that you can teach yourself from free tutorials and YouTube channels. — 00:08:15
  • ★★ If he did not have his YouTube channel, Ali would spend all his time, even at 28, learning to code in Solidity and becoming a Web3 developer; with the channel he is more a media person than a code person. (hypothetical) — 00:08:44
  • ★★★ Ali's third tip for investing time as a teenager is to document your learning and your journey in some capacity. — 00:08:44

00:09:08 — Time 3: document your learning and your journey

  • ★★ Documenting your journey in writing builds the craft of writing, and communicating well in writing is an incredibly valuable skill in the job market, Ali says. — 00:09:13
  • ★★ A second reason to document your learning is that it is nice to look back on: Ali read hundreds of books, many as a teenager, but no one told him to start a blog or document them back then. — 00:09:37
  • ★★ A third reason to document your journey is that you might build an audience, though Ali says that is unlikely unless you take it seriously: it does not happen by accident. — 00:10:06
  • ★★★ Ali's fourth tip for investing time is to learn about video production, a ridiculously valuable skill that all companies are now looking for. — 00:10:35

00:10:55 — Time 4: learn about video production

  • ★★ Ali has about 12 classes on Skillshare and has just released a new one, YouTube for Beginners, on building a YouTube channel from scratch. — 00:11:05 · Skillshare classes, Skillshare

00:11:34 — Skillshare sponsor read and the YouTube for Beginners class

  • ★★ Ali's new Skillshare class YouTube for Beginners is about four hours long with about 30 lessons. (hedged) — 00:11:34 · Skillshare classes
  • ★★ Ali's fifth tip for investing time is to become money literate by learning, reading and watching videos about money. — 00:12:32

00:12:45 — Time 5: become money literate

  • ★★ For money literacy Ali recommends Die With Zero, an interesting philosophical take on how to spend money. — 00:13:01
  • ★★ Ali recommends The 4-Hour Workweek, which he has long called the single book that most changed his life and his approach to life, retirement and business. — 00:13:01 · The 4-Hour Workweek
  • ★★ Ali recommends Vicki Robin's Your Money or Your Life, which changed how he approaches his career. — 00:13:01
  • ★★ Ali recommends Morgan Housel's The Psychology of Money for becoming more financially literate and understanding the emotional, often irrational thinking behind how we spend money. — 00:13:31
  • ★★ Besides books, Ali's personal favourite YouTube channels about money include Graham Stephan and Andrei Jikh. — 00:13:31

00:13:57 — Time 6: get a job or work experience

  • ★★ Ali's sixth tip is to get a job or work experience: it shows what it is like to give your life energy and time for money and teaches skills such as dealing with colleagues and talking with your manager. — 00:14:00
  • ★ When he was younger Ali earned £4 or $5 an hour teaching maths. — 00:14:00
  • ★★★ Ali's seventh tip is to make things for people you admire completely for free, being a permissionless apprentice: for example, turn one of their videos into a tweet thread or a TikTok into an infographic. — 00:14:29

00:14:30 — Time 7: make things for people you admire, for free

  • ★★ Making free work for people you admire develops your skills in a fun way, with a tangible output that may help someone, and might even get you noticed by that person, Ali says. — 00:14:58
  • ★★ Ali's team recently hired a man to turn one of Ali's tweet threads into a graphic after seeing him do such work for others for free on Twitter; some people Ali now works with started by emailing him things they made for him for free. — 00:14:58 · Twitter
  • ★★★ Ali's eighth tip, which he calls a big one, is to try to find a way to build a business as a teenager. — 00:15:27
  • ★★ When he was younger Ali had a little business doing web design and web development for small businesses, charging about $5 an hour to undercut the market. — 00:15:27

00:15:42 — Time 8: find a way to build a business

  • ★★ From about 13 to 18 his web design business taught Ali to work with clients, pitch, sell and negotiate, so when he started his first successful business at university he already had some six years of experience selling to clients worldwide. — 00:15:57
  • ★ Ali found his freelance clients on getacoder.com, which no longer exists; today he points to platforms such as Fiverr, Upwork and People Per Hour. — 00:15:57
  • ★★ Developing a skill and selling it as a service is a great way to build a little side business even while at school, at weekends and in the evenings, Ali says. — 00:16:26
  • ★★★ Ali's ninth tip, quite hard, is to turn active income into passive income by creating a product or digital product not directly tied to your time. — 00:16:26 · passive income

00:16:45 — Time 9: turn your active income into passive income

  • ★★ Once a channel passes 1,000 subscribers and 4,000 hours of watch time and joins the YouTube Partner Program, every video it makes is an asset by itself, Ali says. — 00:16:55
  • ★★ Ali expects this video to make AdSense money even while he sleeps, which makes it a kind of passive income asset. — 00:17:24 · passive income
  • ★★ Making money on the internet does not require social media or showing your face, Ali says. — 00:17:24
  • ★★ To move from trading time for money with a service to a productised service, Ali points to The Millionaire Fastlane, Take Your Shot and The 4-Hour Workweek, and says the process is not that hard. — 00:17:54 · The 4-Hour Workweek
  • ★★★ To people who message him asking how to make money, Ali answers that the advice is already out there: all they have to do is find it and actually execute on it. — 00:17:54
  • ★★★ Ali's tenth tip, one of the best ways to start making your income passive, is to dabble with outsourcing, which needs some money coming in. — 00:18:23

00:18:44 — Time 10: consider outsourcing some work

  • ★★ Ali advises working out your realistic hourly rate and seeing whether you could outsource work to people you can pay less than that. — 00:18:52
  • ★★ Building his business at university, Ali hired a man through Upwork at $5 an hour for admin and data entry from past exam papers, paying him for several tens of hours of work that would otherwise have taken Ali tens of hours. — 00:19:21 · 6med
  • ★★ Outsourcing as a teenager is not about making millions, Ali says, but about developing the skill of hiring someone else. — 00:19:21
  • ★★★ Ali's final point: do not think of these ten ways to invest time as sacrificing today for the sake of a better tomorrow. — 00:19:50

00:20:05 — Enjoy the journey rather than sacrificing today for tomorrow

  • ★★ Looking back on his web design work from 12 to 18, Ali remembers not the money but the excitement of rushing home from school to see whether anyone had hired him, learn more PHP or tinker with an online game he was building. — 00:20:20
  • ★★★ Of the ten ways to invest time, Ali advises choosing the ones that fill you with intrinsic joy, or making them more energising and fun, so you enjoy the journey rather than fixating on the destination. — 00:21:18

00:21:45 — Asks for Money Club video ideas; sign-off

  • ★ Ali has been reading books about money for about 15 years and building businesses since the age of 12; he is now 27. — 00:21:47

Threads in this video

Where the stories that moved here went next

Mentioned

Central: Bitcoin · Ethereum · index fund · passive income · The Millionaire Fastlane

Also: People: Andrei Jikh · Graham Stephan · MJ DeMarco · Morgan Housel · Packy McCormick · Tim Ferriss · Vicki Robin

Projects: Skillshare classes

Works: Die With Zero · Not Boring · Take Your Shot · The 4-Hour Workweek · The Psychology of Money · Your Money or Your Life

Organizations: Fiverr · getacoder.com · People Per Hour · Skillshare · Tesla · The Walt Disney Company · Twitter · Upwork

Concepts: landing page · life energy · permissionless apprenticeship · productised services · virtual assistant · watch time

Places: San Francisco Bay Area

Products: Adobe Photoshop · Coinbase · FTSE 100 · Junior ISA · Medium · S&P 500 · Substack · YouTube AdSense · YouTube Partner Program

Also centred on Bitcoin: What is Bitcoin? - Bitcoin Explained for Beginners · I Lost $54,932 Trading Bitcoin. Here's What I Learned.

Also centred on index fund: How to Invest for Beginners · 9 Passive Income Ideas - How I Make $27k per Week · Revealing ALL My Investments at 27 · How to Invest for Beginners (2026)

Also centred on The Millionaire Fastlane: The Best Book I've Ever Read about Making Money · 15 Books To Read to Change Your Life · What happened to these two brothers? #shorts · 4 Books You Should Read in 2023 · The 4 Best Books About Money - Part 3 📚

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