90 Days to Riches Handbook

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The 90 Days to Riches Handbook and eCourse The 90 Days to Riches eCourse is not a get rich quick scheme. If you’re looking to make a ton of money fast, look somewhere else. I’m sure you’ll find someone happy to scam you. This 9-page handbook will provide the foundation to your road to wealth. It teaches everything in a concise format. After finishing, you will feel empowered and educated. The eCourse itself only takes about 30 minutes, but its positive results will last you a lifetime. Your 90-day check up will showcase your success. It will only lead to many more. Before we get started, do you remember learning how to ride a bike? Try to think back real hard. What was the best way to learn? Did you read about it? Did you study the bike closely? Did you watch others ride for hours? I’m guessing not. Your parents probably forced

you on the bike, and guided you along the way. You can’t learn... until you just do it. Investing is the same way. This eCourse is your set of training wheels. But like the bike, it takes you to pedal. This eCourse is not a passive course. It requires you to take action. But the action is painless, and like I said will only take about a half hour. Don’t waste this golden opportunity that you have. There aren’t many other financial experts with the patience and time to guide you for free. Take advantage while you still can.

Why do you need to invest? Contrary to popular belief, the best way to get wealthy is to build it slowly. The tortoise and the hare, the tortoise and the hare. You know how you hear of lottery winners who end up broke? Or athletes? Or musicians? That’s because they aren’t investing. And if they are, they aren’t doing it the right way. Foolish investors look for shortcuts and big prizes.

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Smart investors are patient. An average 25-year-old investing 10% of his $50,000 income will have $2,430,366 at retirement, assuming 10% yearly gains. Do those numbers excite you? They should. It’s possible for anyone to get rich. Even with an average income. It’s how millions of millionaires have been made in this country. Did you know that more than 80% of millionaires are first generation? That means they didn’t inherit it. They worked for it. They invested for it. You could be that millionaire.

The Power of Money Rich people understand the power of money. They respect it and try to learn about it. Did you know that money can work harder and longer than you can? The rich know this. They know that money never sleeps. That money can work for you instead of you working for money. That money attracts money, and builds

and builds and builds. You make money work for you when you buy assets. Another way to say this is… investing. Investing in stocks is the perfect entry point to buying assets. Then you could move up to real estate. The possibilities are endless. But before we start dreaming up the moon, you have to take your first steps. I know the information on the Internet is overwhelming. Don’t despair, this eCourse will guide you.

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To start, you need to understand how the stock market works.

How the Stock Market Works Big corporations need money to be able to serve all their customers. A lot of money. Look at the mega companies around you with their fancy buildings and equipment. This requires capital. Companies turn to the stock market for funding. They give up ownership to the public, by divvying up the company into shares. Every investor has the option to buy some of these shares. When you own a share of a company, you are part owner. You also get the right to part of the profits, called dividends. Smart investors find companies that are paying good dividends. To buy and hold for the long term. This is the best way to profit from the stock market. You need to understand that the stock market is volatile. That means it often rocks up and down on any given day.

You should never invest money in the stock market that you need soon. You should be planning to hold that stock for at least 3-5 years. You can lose money in the stock market, if you aren’t careful. Many experts warn about the danger of trying to time the stock market. That means trying to predict if stocks are about to go up or down, and acting on it. Nobody knows what the stock price of anything will be tomorrow. You think you know? Experience tells otherwise. The day you know the future is the day this will be possible. You may be confused by now. How am I supposed to win if this is true? While the stock market rocks back and forth like the tide, we do know one thing. In the long term, the market goes up. It averages about a 10% gain a year. Maybe you’ve heard about scary market crashes in the past.

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But you don’t know that these are always overdramatized. The news manipulates emotions and focuses on the worst stories, in order to gain more viewers. The truth behind the drama is that investors who held on to their stocks weren’t hurt by the crashes. Why? Because the market recovered. It always does. 1929. 1937. 1987. 1989. 2000. 2008. All were major market crashes. What happened years later? The market recovered. Every single time. People thought the world was going to end. They always do. Yet the sun continues to rise, and the market continues to stay in a long term upward trend.

Buy Low, Sell High Most investors panic during market crashes. They sell all their stocks because they see stocks as risky. The panicked selling leads to more selling. Yet this is exactly the worst thing to do. You don’t want to be selling low. You want to do the opposite. Buy low, sell high.

When you learn how to pick the strongest stocks, you don’t have to worry during a market crash. It’s so important to buy solid companies. I’ll show you how to do this. It’s equally important to make sure you aren’t buying these companies when they are expensive. Your best returns are going to be from buying companies that are undervalued. You are buying low, and that usually (almost always) means going against the crowd. Buying pessimism takes courage. You can do it.

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Here’s a quick strategy you can use to buy your first stock. This will help you find a solid, undervalued company. How can you tell if someone is rich? If what they own is much more than what they owe. Can you tell when someone is about to go bankrupt? You bet. The same is with companies. But with companies on Wall Street, they are legally obligated to report all of their financial data. Good news for us. We can easily look through their financials, and identify which companies are strong and which aren’t. The hard part is deciphering what the numbers mean. That’s what this handbook is for. For beginners like you, I want to focus on the balance sheet. This is where we can see exactly what the company owns and what it owes. If they own a lot more than they owe, then they are in really great shape. It sounds so simple when I say it like that, doesn’t it? That’s cuz it is! We don’t need to get too complicated here. You can use this info, and find really great investments.

The following parameters do everything we want. You get a stock that has a strong balance sheet, and at a great price. You want to find a stock with: -Low Price to Earnings (P/E) Ratio -Low Price to Book (P/B) Ratio -Low Debt to Equity Ratio

Low P/E Ratio Low P/E Ratio keeps us invested in companies that are very profitable. It protects us from bubble stocks, which crash the hardest in tough times. Cisco (CSCO) crashed from $77 to $16 during the dot com crash. It had a very high P/E and could’ve been easily avoided.

Low P/B Ratio Low P/B Ratio is how you’ll build wealth. It’s how you’ll get a $1 worth of assets, for $0.70 on the dollar or less. This ratio tells you exactly how much value you get.

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A P/B of 0.5 means you’re paying 50% of book value; 1.25 means you’re paying 125% of book value. Look to always get a discount on book.

Low Debt to Equity Ratio Low Debt to Equity keeps us from risky companies. Companies that are about to go bankrupt typically have a high debt to equity ratio. Lehman Bros. had a debt to equity of 29 in 2007. The next year it went bankrupt. Again, easily avoidable. I’ve explained in great detail why each category is important in my eBook 7 Steps to Understanding the Stock Market. For this eCourse, I will just teach you how to quickly find this. Feel free to read through my research if you want to know why this works.

Simple Parameters To be more exact, we want stocks with: -P/E below 25 -P/B below 1.5 -Debt to Equity below 1 How do you find these? It’s very simple and I’ll show you how to do it in just minutes. What you are learning here has taken months of learning and research. And you’re getting it all in this short handbook. What a deal. The website you want to use to find these stocks is called finviz.com. It updates daily, and helps you screen through thousands of stocks in seconds. First click on the screener tab. Then you’re going to want to add some filters. For Index: S&P 500. Dividend Yield: Positive (>0%).

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Next click the Fundamental Tab. For P/E: Under 25. P/B: Under 2. Debt to Equity: Under 1. You can now click the Valuation Tab to sort by P/B and find the best value.

The list that pops up will be a great starting point for you. Especially if you are buying your very first stock. You can’t go wrong here. You will get a disproportionately high number of banking and insurance stocks with this screen. If wanting to buy one of these, I’d sift through annual reports and determine the best by

comparing within their industry. This is advanced, and I wouldn’t recommend it for beginners. A couple of rules when buying stocks. These will protect you from significant losses.

Rules for Buying Stocks 1. Never buy a stock with negative yearly earnings. Sell your stock if this happens. 2. Never buy a stock that doesn’t pay a dividend. Sell if they stop paying a dividend. Simple yet effective. Trust me on these. You can also use these rules to sell your stock if the Debt to Equity ratio goes much higher than 1. I wouldn’t sell just because of a high P/E or P/B because you’d be cutting your gains. It’s all up to you. The negative earnings, no dividend, and high debt are always red flags though. Also always try to hold a stock for at least a year. At that point, your asset holding becomes long term instead of short term. This has tax advantages for you. Which is always good.

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You now have enough tools to get started. Remember when I said it’s up to you to pedal? Now is your defining moment. You can keep looking and searching. But nothing will happen until you take that first step. Buy a stock, even one share. You don’t have to be right the first time. The important thing is to get involved. Once you do, you might be surprised. You’ll find it’s not that bad, not that hard. You won’t believe your progress after just 90 days.

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You don’t have to understand everything I’ve just taught you. But you do have to understand this one thing. Because once you start, you’ll be on the path to riches.

About the Author I’m Andrew Sather. Father, husband, investor, entrepreneur.

In my free time I am an electrical engineer at a Fortune 500 company.

Passionate about getting beginners on the road to wealth. Simplifying the stock market with a number based approach.

Copyright: www.einvestingforbeginners.com Published: Dec 6, 2013. All Rights Reserved.

Information in this eBook should not be construed as investment advice. The work is based on SEC filings and should not be seen as a solicitation to buy or sell certain securities. All readers of this guide must do their own due diligence.