Earn Your Leisure Podcast: Episode Summary – "How to Invest $100K"

Release Date: February 19, 2025
Hosts: Rashad Bilal and Troy Millings
Podcast Title: Earn Your Leisure

1. Introduction

In the "How to Invest $100K" episode of the Earn Your Leisure podcast, hosts Rashad Bilal and Troy Millings delve into strategic approaches for investing a substantial sum of $100,000. The discussion is enriched by insights from guest Ian Dunlap, who shares his personal investment experiences. This episode is a blend of practical investment strategies and real-world applications, making it a valuable resource for listeners aiming to optimize their financial portfolios.

2. Investment Strategies for $100K

a. Troy Millings’ Investment Strategy ([04:15] – [08:56])

Troy Millings outlines a balanced approach to investing $100,000, emphasizing the importance of diversification and sector-specific investments.

• Index Funds Allocation:
  Troy recommends allocating 50% ($50,000) of the investment to index funds. Specifically, he suggests funds such as VOO (Vanguard S&P 500 ETF), VTI (Vanguard Total Stock Market ETF), and VGT (Vanguard Information Technology ETF). He advises entering these investments "at a drop" to avoid the pitfalls of purchasing at market highs. As Troy states,

  "Put half of it into index funds at a price point that I call so VO VTI VGT on a drop. You don't want to put it in at an all-time high." ([04:30])

• Technology Stocks Allocation:
  The remaining 50% ($50,000) is directed towards technology stocks, selecting two specific companies. Troy emphasizes choosing strong, established tech giants like Apple, Microsoft, or high-growth potential stocks such as Nvidia and Tesla. He highlights the balance between risk and return, noting,

  "If you have a company like Nvidia, let's say Tesla, Tesla may draw down 40 at any given time. But you may miss out on 400% over a four or five-year period by not investing into it." ([05:45])

• Risk Management and Diversification:
  Troy underscores the significance of balancing risk and potential returns. By splitting the investment equally between index funds and technology stocks, investors can mitigate significant losses while positioning themselves for substantial gains. He advises against speculative investments like "Gamestop or do zero day traded options," advocating for a more structured and informed approach to investment.

b. Ian Dunlap’s Personal Investment Strategy ([09:38] – [12:06])

Ian Dunlap shares his own strategy for investing a similar sum, providing a real-world example of effective portfolio management.

• Diversified ETF Investment:
  Ian allocated $100,000 equally into three ETFs: SMH (VanEck Semiconductor ETF), XLK (Technology Select Sector SPDR Fund), and XLY (Consumer Discretionary Select Sector SPDR Fund). He explains the rationale behind equal distribution, stating,

  "If that pulled back, I'm somewhat protected because it's not the only thing that estimation invests in." ([10:05])

• Risk Management:
  Emphasizing the importance of not jeopardizing one's financial foundation, Ian ensures that he does not invest his "last $100 or your last $10,000 or your last thousand." Instead, he approaches the investment with a well-planned risk management strategy, leaving a buffer of $1,000 uninvested to safeguard against unforeseen downturns.

• High Returns Through Strategic Choices:
  Reflecting on his investment choices, Ian notes significant returns,

  "Those three investments appreciated by 1200 percent at minimum each." ([10:45])
  This underscores the potential of well-selected ETFs in generating substantial long-term growth.

• Educational Stance:
  Ian highlights the importance of being educated before making significant investments. His disciplined approach—awakening early mornings to strategize and meticulously planning his investments—demonstrates a commitment to informed decision-making.

  "Taking an educated stance on it obviously before I was going to do it." ([09:50])

3. Key Insights and Discussions

• Diversification is Crucial: Both Troy and Ian stress the importance of diversifying investments to balance risk and reward. By allocating funds across index funds and specific sector stocks, investors can navigate market volatility more effectively.

• Timing Matters: Entering investments at strategic price points, such as during market dips, can enhance returns. Avoiding investment at all-time highs reduces the risk of immediate significant losses.

• Long-Term Vision: Emphasizing patience and a long-term perspective, the hosts advocate for investments that have the potential to grow substantially over several years, rather than seeking quick, speculative gains.

• Educated Investing: Continuous education and informed decision-making are highlighted as essential components of successful investing. Understanding market trends and the fundamentals of chosen investments can lead to more resilient portfolios.

4. Conclusions

The "How to Invest $100K" episode of Earn Your Leisure provides a comprehensive guide for individuals looking to make the most of a substantial investment. Through the combined expertise of Troy Millings and guest Ian Dunlap, listeners gain valuable strategies centered around diversification, risk management, and informed decision-making. The episode reinforces that with a balanced approach, strategic timing, and a commitment to education, investors can significantly enhance their financial growth and stability.

Notable Quotes:

• Troy Millings:

  "Put half of it into index funds at a price point that I call so VO VTI VGT on a drop. You don't want to put it in at an all-time high." ([04:30])

• Troy Millings:

  "If you have a company like Nvidia, let's say Tesla, Tesla may draw down 40 at any given time. But you may miss out on 400% over a four or five-year period by not investing into it." ([05:45])

• Ian Dunlap:

  "Those three investments appreciated by 1200 percent at minimum each." ([10:45])

• Ian Dunlap:

  "Taking an educated stance on it obviously before I was going to do it." ([09:50])

This episode serves as an insightful resource for both novice and seasoned investors, offering practical strategies and real-life examples to guide substantial investment decisions.