Midway through 2020, after Kuwait had paused bank loan installments on its citizens for 6 months, I started researching the best way to grow my money. After all, cash sitting in a savings account is a depreciating asset and doesn’t scale with inflation. Many of the people I asked for advice told me to buy gold, which felt antiquated and just...off. Two of my friends suggested I start investing in stocks. “How is that any different from gambling?” I wondered, until my Saudi friend Yousef went out of his way to teach me the difference between the two.

I spent the entirety of my February watching YouTube videos on the stock market for an average of 14 hours per week. I went through tens of articles, a handful of books, four calls with my financial advisor, hours of chats with my friends Yousef and Sultan, and three daily newsletters. I even watched a few movies and documentaries on the subject because I wanted to learn from the history of recent market crises. I will in turn try to distill the information that I digested so that you, too, can start to grow your wealth. This guide is coming from a risk-averse person who never considered himself good with money—someone who, in January of 2021, couldn’t even tell you what the symbols “S&P 500” meant.

(If you're a seasoned investor and you're mad at the simplicity of this breakdown, I’d urge you to look elsewhere. This is not for you.)

The stock market has always felt like an unscalable mountain. Having relatives who lost all their money there certainly didn’t make the metaphorical climb any more enticing. But it was Warren Buffet’s infamous bet that made me understand how compound interest and capital growth can help me grow my money. If, like me, you were curious about investing your money but never knew where to start, then NPR’s Planet Money has a good episode on the subject of Buffett’s bet on the S&P 500 index fund.

Buffett’s point was that putting your money in an S&P 500 index fund, and contributing to it monthly or quarterly, would be better than hiring investment professionals who charge exorbitant fees to manage and grow your wealth. He was right, and he won the bet.

The S&P 500 index fund, like VFINX (managed by Vanguard), is the brainchild of Jack Bogle. He’s the founder of the aforementioned Vanguard, the largest issuer of mutual funds in the world and the king of low-cost investments.

Side not before we continue: Vanguard's S&P 500 Index Fund (VFINX) can be traded in the NY Stock Exchange through Vanguard's own ETF, VOO. If, like me, you don't have access to mutual funds with your brokerage account, you can simply buy into the VOO stock. Other mutual fund companies have their own versions of the S&P 500 index fund, like BlackRock's IVV and SPDR's SPY.

Jack Bogle came up with the idea of this “tracker” that would mimic the movement of the top 500 companies in the U.S. stock market. When the market is high, your invested money goes up. When the market declines, your invested money goes down. Statistically, however, the market returns an average of 10-11% annually. If you had opened a brokerage account in February 2020 and purchased $10,000 worth of stocks in VOO, you’d have lost around 30% of your money the following month amidst the COVID-19 lockdowns. If you had sold your stocks in March 2020, just a month later, you’d have gotten $7,000 back—$3,000 less than your initial investment.

If, however, you held on and sold them today, in March 2021, you’d have made 15% more. Another example: What if you’d bought VOO back in, say, 2015? If you were to sell your stocks today, you’d have made between 80% to 90% profit. That’s $9,000 on top of your $10,000.

Money might not grow on trees, as the old adage goes, but it certainly does grow in index funds. And hedge fund investors hate index funds like the S&P 500 because they make their jobs obsolete for the majority of everyday investors like you and me. In fact, Warren Buffett’s will to his wife instructs her trustees to put 90% of her wealth into the S&P 500. And every time Buffett is asked about the validity of the S&P 500, he reiterates that he still believes in it.

If you’re reading this and you’re a newly minted investor, an S&P 500 stock like VOO might sound boring to you. You don’t want an 80% increase after seven years! You want the insane short squeeze that happened with GameStop’s stock—a 300%, 400%, or even 1000% increase in a few days’ time. But if you’re new to the stock market, doesn't it blow your mind to know that you can grow your money reliably, away from the gambling mentality of meme stocks, as proven with historical data that goes back over a hundred years? The data tells us that investing routinely in an S&P 500 fund (like VOO or IVV) can grow your money beyond any other means available to ordinary folks. Yet this basic concept of compounding money took me until my thirties to discover. It’s hidden behind all the jargon Wall Street doesn’t want you to know, and behind all the horror stories you’ve heard over the years of people losing their money in the market. The truth is, you don’t have to play the stock market like a casino. You should instead treat your stocks like you treat your (hypothetical) house: as something that fluctuates in price, but that you can tolerate because you’re here for the long haul. Not just five or ten years. You wouldn't sell your house if some lunatic came and started screaming outside your window about its depreciating value. Take that mentality when you're investing in stocks that you believe in.

“All right, I’m in. Where do I start?”

1. Understand the S&P 500 index fund. You need to understand how it works so that when it dips by ten or twenty percent (or 40% like in 2008’s financial crisis), you don't panic and sell prematurely. For the most part, you want to be a passive investor. You buy into your index funds, whether they’re high or low; you go on with your life; you invest again when you get more money. Rinse, repeat.

2. “There’s talk of a stock market bubble. Should I wait until the market crashes before I buy into VOO?” Yes and no. Yes, you should have some cash saved up for when a market crash happens. That’s how a lot of wealth is created. But remember that you’re here for the long haul. Not ten years, not even twenty years. If you’re in it for the long haul, then time in the market beats timing the market. As long as you’re buying into the S&P 500 fund routinely (be it monthly or quarterly), and you plan to hold on to it for a few decades, you don’t have to beat the market. Dollar-cost averaging is a proven method for long-term investing. Also, no one knows when the market is going to crash. If you sit on your money and wait for a crash, it could happen next month or it could happen in two years. That’s time you could’ve used to grow your money inside the stock market. So, don't try to time the market–spend time in the market.

3. Go with a brokerage service that supports dividends reinvesting. Some of the stocks that you’re going to invest in will give you quarterly dividends—that means quarterly payments sent to you. You don’t want to take that money. You want your brokerage service to invest the dividends back in the stock, thus buying you more shares automatically. Compound interest is how you’re going to exponentially grow your money. Learn it and understand its power!

4. “Do I simply buy VOO, and VOO shares only, for the next X years?” That’s a conversation you want to have with a financial advisor or a specialist! They’re going to build a portfolio for you with various index funds. For example, my financial advisor wants VOO to be 20% of my stock portfolio, while ITOT is factored in at 30%. (ITOT is the total market index fund, not just the 500 biggest companies like in VOO.) Let a professional help you build a rock-solid portfolio that suits your risk tolerance. I have made my own adjustments on top of my financial advisor’s suggestions, but if you don’t have the knowledge, and you’re not willing to learn, that’s fine! Simply go with their suggestions. A financial advisor is going to save you tens of hours of research because they had spent thousands of hours of research to help people like you and me.

Disclaimer: I fully endorse and recommend working with my financial advisor, Mr. Abdulraheem Rahimi, if you're based in Kuwait or thereabouts.

5. If you’re in Kuwait or the nearby Gulf countries, you need to research the services that allow you to trade in U.S. stocks and find the one that suits you best. In Kuwait, there are a few banks that allow you to invest in the U.S. stock market, and each comes with their own set of fees and restrictions. For example, Boubyan Bank imposes restrictions on which stocks you can buy; it excludes VOO. I wouldn’t want to work through a bank that delists stocks as they see fit. NBK Capital, the service provided by Kuwait’s largest bank, charges $25 per transaction plus other fees. The brokerage that I use, Saxo Bank, is based in Denmark and charges $10 per transaction, plus monthly custody fees with a minimum of $5. Some of my friends have accounts with Interactive Brokers, Ameritrade, and others. Those services have even lower costs, all the way down to $0 transaction fees. You’re going to have to do your own research and settle with a brokerage service that aligns with your needs and interests. I personally don’t trust free services in America to handle my money or my personal information, and I’m more comfortable with a bank that is transparent about how it profits from my investments. I also plan to move abroad, which means I don’t want a brokerage account based in Kuwait. That’s why I chose Saxo, which has many offices in Europe, a continent I visit every year, as well as Dubai, a city that's just two hours away from me. What suits me might not be ideal for you, so that's the one area you're going to need to research on your own.

6. Before you start buying stocks, you need to have a financial plan, and you’re going to want to stick to it by the letter. I set for myself a monthly spending limit in one account, monthly short-term savings (for my travels) in another account, and an emergency fund in a third account which acts as a shield for car troubles, health emergencies, and so on. When my salary is deposited in my main account, I send an amount to my travel account, then I keep my monthly expenses in my main account alongside my monthly pocket money. Then I transfer the rest to the emergency account. This emergency fund prevents me from selling my stocks at a loss to cover any sudden expenses I could face. My financial advisor helped me set up my plan. You should consult one if you’re not confident in your monetary skills—doubly so if you plan to invest in the stock market.

7. Don’t want or can’t afford to hire a financial advisor? I used monthly for three years before I consulted a financial advisor. It’s an intuitive app for tracking your expenses monthly, and quickly determining how much you can save even if your monthly income is variable like mine. It’s just a smart checklist app—it’s not going to recommend stocks for you to buy nor is it going to change your relationship with money, but it is going to help you take command of your expenses and potential savings.

(You can still buy your Starbucks latte and avocado toast. You’re just going to have to manage your pocket money smartly. Aim to strike a healthy balance between Scrooge McDuck and Tony Soprano.)

8. Do. Not. Gamble. This is a crucial point. If you’re reading this guide, you’re not a millionaire and you don’t have excess wealth that you can afford to squander on opportunities. YouTube is a great resource for learning about the stock market, but it’s also full of trendy stock recommendations. My portfolio consists mostly of exchange-traded funds, or ETFs, like VOO (S&P 500), QQQ (the top 100 NASDAQ companies excluding financials), and ITOT (the total stock market index). ETFs are like a basket of companies. You buy one ETF share, and that share gives you ownership in the companies that the ETF invests in. That means if Apple goes bankrupt tomorrow, your money in VOO won’t go down the drain alongside it because you’ve invested in 499 other companies. ETFs aside, I allow myself a small amount of play. But this is not a casino—my play money is money I expect to grow. These investments are just riskier because the money is invested in single companies, and not an agglomeration of companies like with ETFs. I bought shares in Apple and Disney because I fully believe in their future growth and I understand the businesses themselves. But what about Tesla? Well, by owning stocks like VOO and QQQ, I’m exposed to Tesla, but I don’t own a single Tesla stock myself. My opinion on Tesla doesn’t matter. I have to constantly remind myself that I’m in the stock market to make money, not to make risky bets. The ones I have made are grounded in a deeper understanding of the particular brand of fire I’m playing with. I’m willing to miss all the shots that I see and don’t partake in with Tesla for the time being.

9. If you intend to risk a portion of your money in single-company investments, you need to understand those businesses inside out. I have seen the balance sheets and the detailed financial breakdown of all the companies I’m invested in. If I buy Apple today at $126, and it drops to $50 in a market crash tomorrow, I’m going to buy this dip because I believe in the fundamentals of the company. If you don’t understand how a company works, you’re not going to be able to differentiate between when a stock is on deep discount and when a metaphorical Titanic is sinking into the abyss.

10. I'm not a day trader; I'm an investor. That means I don't buy 200 shares in a company for $120 and sell them at $125. I mean, you could do that. That's just not how I behave. I'm after considerably bigger gains, so I invest in the long term. In my eyes, the Apple shares that I bought at $126 are going to be worth a lot more in a few years. I can see the company's stock price soaring to four digits within the next decade. That allows me to buy stocks and sleep on them. That also allows me to live my life away from obsessively checking my trading app to sell stocks for a 2% gain. If you're a day trader who has made thousands of dollars flipping like this, good for you! It's a hard job and you deserve it. I simply prefer to put my money in stocks that I believe in. 

11. Did I lose you? Sit down and take a deep breath. You’re not required to do anything risky to be a successful investor in this market. You don’t need to buy single-company stocks or read financial reports. Simply invest your money in stocks like VOO and ITOT. Forget about the rest of the market. Buy high, buy low, buy at all times. That’s it. Consult with your financial advisor. Listen to the Get Money podcast to build a knowledge base on the subject. Tune out the noise and just focus on how you can grow your wealth.

Lastly, set firm financial goals and keep them at the forefront of your mind. The reason I’m investing in the stock market is because I need a faster track to making enough money to help me relocate and live abroad. I’m risk-averse, so quitting my job to wade into financial insecurity elsewhere isn’t something I’m equipped to handle. I want to be financially independent before I move on from this rote, 9-to-5 phase of my life. I’ve calibrated myself to live off of 10-15% of my salary and invest whatever is left after paying my monthly expenses. I’m no longer buying new gadgets or laptops or camera lenses on a whim. Having a plan makes it easier to recenter and focus on my ultimate goal. It’s okay to simply want more money, but tying my desires to specific goals removes the casino-like aspect of the stock market, allowing me to approach it like the money-making machine it is.