I’ve Invested for 21 Years. I Check These 4 Things Before I Invest

10% or 20% returns?

10%.

20% returns. If I showed you 2 investments, one returning 20% and there's another one returning 10%, which one would you choose? I mean, most people would just say 20%, surely.

Hmm.

But not necessarily, because I haven't told you how much money you could lose if things don't work out. I haven't told you how much work that 20% requires. I haven't told you whether you will spend the next 3 years worrying about it and having sleepless nights. I haven't even told you how much of your life it consumes in terms of effort, energy, and all that. Because every investment has a cost, and it's not just the money you put in. It goes beyond that. There's your risk you're taking, the energy, the stress, the time. Some investments could even cost you sleep. Some cost you time. Some require enormous effort, and some expose you to unnecessary risk you don't discover until something goes horribly wrong. And after 21 years of investing, I've learned not to only ask, how much can I make? That's a question we often jump to. I also ask other questions like, what will this investment cost me in terms of other aspects like energy, stress, and time? And I use 4 things to answer that question. It's what I call my REST framework. Okay. R-E-S-T. Risk, effort, stress, time. REST framework. Okay. And by the end of this video, I'm going to show you how I use those 4 things to quickly screen through investments. Opportunities, and I get pitched investment opportunities every single day. So I use it to quickly screen an investment to even, you know, know whether it's worth doing any further research, because ultimately I want my investments to help me build more financial freedom and allow me to still have some peace of mind. So I want to invest with peace of mind. Now there's one investment you can make right now. It can cost you absolutely nothing and give you great returns. Takes you 1 second of your time. If you hit that subscribe button now, yep, you'll get more videos like this and you won't have to wonder why YouTube suddenly stops showing them to you. It's not a bad return on 1 second, so go ahead and click it, right? Let's click it. Excellent. Right now, if you're new here, hello, nice to meet you. I'm Dr. Andy Egwim. I'm a UK-based doctor, also GP, family physician. But I started investing more than 21 years ago at 19 with a tiny amount of money while I was still in medical school from the proceeds of my little side Now, investing went on to become an important part of my journey towards financial independence. And about 4 years ago, I was able to step away from paid employment, salaried, my salaried medical practice as a UK-based GP. Since then, a few months after then, I started The Money Wise Doctor. And since then, we've taught 4,400 doctors about investing, tax efficiency, and financial well-being. In fact, more than 10,000 doctors receive our free weekly financial education emails. And I'm also the author of this book, The Money Wise Doctor, which became an Amazon bestseller investing, personal finance, retirement, and money management. But after 21 years of investing, one of the most important lessons I've learned from investing is that the highest return is not necessarily the best investment. Think again. The highest return is not necessarily the best investment. There's an old saying that you can either eat well or sleep well. You can take enormous risk, and if everything goes right, perhaps you eat extremely well. I saw people started when we started. Some of them blew up. But even while you're getting that return, you may not sleep very well. You might be worried. I want to sleep well and I want to eat well, but I want to find a middle ground. I want my investments to help me to keep growing my financial freedom without sacrificing my peace of mind to get there. And that's what the REST framework is about. That's my approach for screening investments. I've also turned the REST framework into a simple checklist with explanations that you can use whenever you're looking at investment opportunities. It's completely free and you don't even have to wait till the end of the video to get it. I'll put the link in the description and I'll ask my team to pin it in the comments so you can click on it, download it totally for free and keep it. And the next time you see an investment opportunity or you're considering an investment, run it through the full REST checklist. Okay? If it helps you to make one better decision or avoid one costly mistake, Then this video has done the job, and the time I invested in doing it and the research will be worth it. Okay, right. Let's get into it. So something happened quite recently. You know, I recently made a video analyzing an initial public offer, so an IPO for Dangote Refinery IPO. Now I've analyzed investments on IPOs before on this channel, including SpaceX, but this one went slightly crazy. Now, this is not the first time, you know, or the first IPO we've analyzed, but this particular video went slightly crazy. More than 800,000 views. In fact, approaching 900,000 views now. Hundreds and hundreds of comments, over 800 comments. I kept seeing versions of the same questions. Dr. Andy, is this a good investment? Should I invest? What should I check before investing? Do you think it's safe? Do you think I might lose my money? Dr. Andy, are you buying? And look, I realized something. Those questions are not really about the Dangote IPO shares. They are wider investing questions. Because today is Dangote, tomorrow it might be another IPO or investment opportunity or a property or a startup or another cryptocurrency or a piece of land for land banking or a business that you could invest in, an opportunity. It could be another investment that somebody tells you is the opportunity of a lifetime. So rather than simply analyze another investment for you, I thought, hmm, Let me just show you how I think about an investment and how I screen them before I decide whether they even deserve more of my time or money at all. And before we get to the REST framework, there's something important to understand. You don't need to own everything. You don't need to invest in every single thing, okay, to get to where you're going. One of the problems with having money to invest is that suddenly there are hundreds of people that want to tell you what you can do with it, especially if they've not invested their own money. Buy property, buy land, buy shares, buy index funds, buy Bitcoin. Buy gold. The tinna is really nice. Buy whiskey cask. Buy palm oil. Buy a plot of land in Lekki or buy an apartment in Dubai. Invest in a startup. Buy ETF. Invest in your cousin's fantastic new business idea going to plant corn in the moon or whatever. You know, there are lots of people with great ideas once you have a bit of money to invest. And somebody somewhere has probably made money from every one of these things. Maybe apart from planting corn on the moon. I don't know about that. But here's something that took me years to properly appreciate. You don't need to invest in everything that can make money. Not everything. Now, practical example. Imagine I want to travel from London to Manchester. I could drive, or I might decide to take the train. I might even decide to fly. These are different routes. Or maybe I'll say I want to go on horseback. That might take me longer. But different trains, even if I want to go by flight, there are different airlines. But imagine I drive halfway to Manchester, then I turn around and jump on a train, then get off. I want to get On a horse to, you know, and then decide to then get off and then drive to the airport and then catch a flight somewhere else. You think something is wrong with this guy. And then I'll tell you, don't worry, I'm diversified. No, that's diworsified. Yeah, diworsification. That's what's going on. No, in that case, I'm lost. You don't have to travel on every available route or road to reach your destination of financial independence, but you need a route that actually gets you where you're going. Reliably. Not something brand new, something that has been done. Look, investing is similar. You don't need property and individual shares and index funds and Bitcoin and gold and whiskey and startups and land banking and commodities simply because somewhere somebody has made money. You don't need to do all of that. You can pick a couple of them. For many people, consistently investing into something relatively boring, diversified, and low cost over decades may already do most of the heavy lifting. That's what the data has shown. Somebody else might choose property. Somebody might build businesses. Somebody might buy index funds. Somebody might buying several approaches. Someone might start a business and sell it. The point is not that one route is universally right. The point is you don't need to do everything. You need to pick one or two or three and just stick to it. Now, the question is not, can this investment make money? The question should be, does this investment deserve a place in my life? If you look at your lifestyle and your goals and other things. So that's what I use the REST framework to do the screening before I even look a bit further. So let's start with R. R is for risk. Risk, because risk and reward are two sides of a coin. And when I say risk, I don't mean simply can the price go down? Almost every investment can fall in value. So, but the thing I want to know is how could I permanently lose my money? It's not whether it goes up and down. How could I permanently lose my money? You know, and there's another question that is even more important. If I'm wrong and I lose my money permanently, what happens to my life, my lifestyle, my family? Because risk and reward are usually connected, right?

Now, let me give you a simple example.

Imagine the UK government wants to borrow your money. Okay. They're selling bonds or gilts just for illustration, and they will pay you 5%. Then somebody you've never met before comes on LinkedIn or Instagram and says, look, Andy, forget the 5% you're going to get from 10-year bonds. Give me your £100,000. I'll pay you 20% or 25%. Some people immediately hear the 20% or 25% and get excited. I'll ask, well, why? Why are you willing to pay me 4 times or 5 times as much than the UK government? What am I being compensated for? I'm not saying I'll lend to the UK government, but I want understand the risk. Maybe there's a perfectly legitimate answer and you have a fantastic opportunity, but that extra return is not necessarily a gift. It may be a compensation for additional risk, what we call risk premium in investing. And that's why sometimes the higher the return being offered, the more questions you want to ask, not fewer. Okay? There's no rush. There's no— these are not opportunities going away. No. Think about government bonds. UK government bonds, they pay you 5%. You buy a government bond, they're essentially lending money to the government, and the government are investors A government like UK government, US government, that many investors think highly likely to repay its debts can generally borrow at a lower rate than, for instance, a government like Argentina, who have their 7-year bond at some point offered at 49%, and people weren't even rushing it. So the same basic principles can also apply to companies borrowing money. Let's say a company like Apple or Coca-Cola wants to borrow money. They might be able to borrow money from the public, sell their bonds, corporate bonds with a lower interest rate compared to, you know, a smaller startup company that's a little bit riskier. Okay. For the riskier company, you would likely say, hmm, if I'm taking more risk with my money, I want the possibility of being compensated for taking that risk. This concept, we call it risk premium in investing. Most people don't even think about it before they give ₦20K or ₦30K to someone doing property that'll give them 10% compared to the stock market. So when you see a higher return, don't automatically think Better investment. Sometimes the better question is, what additional risk am I being asked to take for that additional return? Am I being compensated for that? Okay. Now let's move from lending money and bonds to actually owning something. So investing in assets. Imagine I give you 2 options. Okay. Again, 2 options. The first is a diversified index fund holding hundreds, perhaps thousands of companies. Okay. The second is your friend's brand new AI startup. Now your friend is an idea guy, has had lots of ideas and businesses in the Some did well, some didn't do well. So Andy, it says, Andy, this thing could 10x your money in the next 3 years. And you know what? He might be right. Maybe your money will 10x in the next 2 or 3 years. On the other hand, that diversified index fund is extremely unlikely to 10x your money in just 2 to 3 years. The startup could potentially do it, but there's another side of that story which people often don't look at. The startup could fail. I'm not saying don't take risks, but understand the risk. And your investment could become what? Precisely zero. If that startup fails, zero, it goes to zero. So with a startup, you haven't simply just bought an investment. There's also a possibility of a loss. There's a wider range of possible outcomes. I'm not saying that index funds can't fail, but now the risk is higher because the possibility of a spectacular upside can also come with the possibility of a spectacular downside. Again, I'm not saying don't invest in startups. I've invested in startups myself. in a tax-efficient way. What I'm saying is, don't compare investments only by asking, you know, which one could make you the most money. Okay? Ask, what am I risking to get that potential return? Okay? Then that would even help you to allocate appropriately, know how much you can spare to invest. And then there's an even more important question. If that risk that I've thought about materializes, what will happen to my life, my lifetime, my livelihood? Because that's where risk stops being something on just a spreadsheet online and Now, I've seen the human consequences of getting this wrong. I'll give you an example. I remember speaking to a senior doctor, I think it's consultant, approaching retirement. He was originally, I mean, he moved here from Nigeria. He has spent almost 30 years working in the UK. Stellar, impressive career, raised his family, community leader, and built his pension, his workplace NHS pension, building his savings, accumulating the money slowly over decades. Then he decided to take from his pension pot when he was eligible. Now, he took like 25% of it. This is not money that he accumulated overnight. He's been working here years and decided to make an investment. Great opportunities in Nigeria. One was in land, one was a business invested with someone, and one was agriculture. Different opportunities involving other people, and the potential returns sounded super attractive at that point. But everything didn't go well. At the time he was speaking to me, he had lost more than £100,000, money that had taken decades to accumulate. I'm not saying investing in Nigeria was the problem, but he didn't even understand what he was investing in. He didn't have any control. He was full of regrets. Look, he had retired already, okay? And within less than a week, he was back at work because it was at the point where retirement was optional for him. Not because retirement became boring, but because he missed going to work. He needed to work again. Think about that. Nearly 30 years working hard, building towards retirement and all that, and decisions made with money accumulated over those years materially changed what retirement could look like for him. So one would let us hope, okay, there's a good side.

He had been through the Moneywise Dr.

My academy later and had learned about diversifying, investing, risk, and some of the simpler ways he could have approached investing. This was 6 months later. And looking backwards, he told me something along the lines of, Andy, if I had understood this years ago, even 10 years ago, I could have kept things much simpler and started, you know, investing in a simple way. He ran his own numbers and looking back, he said his own conclusion was that he didn't need all the complicated schemes or opportunities. He could have kept his investing boring, simple, what he can control with the touch push of a button. He thought about broad market index funds, stocks, bonds, a diversified portfolio appropriate to his own risk tolerance. So just basically things he could understand, monitor, and manage himself, and then simply give compounding the time to do the work. Now everyone is different. By his own calculation, he believed he could have ended up in a much better position without taking anything close to the level of risk he had taken. Look, sometimes good investing is boring. You don't always need the exotic opportunity, the land deal, the agricultural scheme, the oil block in Venezuela, the business promising extraordinary returns. Sometimes a simple diversified portfolio investment you understand, matched to the amount of risk you can actually afford to take and enough time for compounding to work, it could be enough. It could get you to London or Manchester, wherever you were going. Now, of course, hindsight is 20/20. Hindsight is wonderful. It's very easy for us to look backwards and say, I should have done this, I should have done that. And I'm not telling you that investing in ETFs therefore, an index fund guarantees a particular return. No, that's not what I'm here to say to you. I know better than that after 21 years of investing. There's no guarantee. But the important point is something else. When this doctor, when he originally made many of those decisions, he didn't really understand the alternatives available to him that were lower risk. He didn't yet understand how he could invest in the stock market in a diversified way without trying to find the next company that would make him rich overnight. He didn't understand that. So when these opportunities were presented to him, And it's glitzy and all that glitters is not gold. Those opportunities became his investment universe, what he could think about. And that's why I think there's a lesson for all of us, because the question wasn't simply, could this land banking deal make me money, or agricultural product, or whatever it is? You know, the question was not, could this agricultural business make money? That was not the issue. Of course they could. People make money from it as well. The more important question for him was, what happens to his lifestyle and his work if they don't? Because when you are 30 and risk £20,000, you may have decades of earning power. Ahead of you. But when you're approaching your retirement age or your retirement goal and you're risking money that took 30 years to accumulate, the consequences of being wrong can be completely different. Okay. Now the lesson here is not never invest in Nigeria or India or Pakistan or any other country. That's not what I'm saying here. And it is not never invest in a higher risk business. Just understand there's a place for everything. I've invested in startups myself and other things as well, including, I mean, And that's not the lesson. I want you to get the point. And it's certainly not only buy index funds or give your money to somebody to manage. No, the lesson is much simpler. Risk is personal. And that's why I don't only ask, how much could I make if I'm right? I also ask, what happens to my life if I'm wrong? You have to look at both sides, okay? And make an intelligent investment decision. That's the boring part. That's not the exciting part you see when people say, oh, this is a shiny investment. That's the question I wish every investor would ask. Before the money leaves the account, before you do the transfer.

7. There are 7 steps to take before you even start thinking of investing as a doctor or healthcare professional. Now, this is really important to secure your financial foundation before you start investing. Now, I've covered these 7 steps in a simple guide that I've made available for you in the link in the description. You can download it. It will help you to build a solid financial foundation Avoid common investing mistakes and also make tax-efficient investment decisions. Start your investment journey the smart way. Download the guide now using the link in the description, and good luck on your investing journey. Now let's get right back to the episode.

Now imagine 2 doctors invest in exactly the same speculative startup. Let's say Dr. Priya. So Priya is 35, a GP partner, has £100,000 in savings and investments accumulated, she puts £2,000 into a speculative startup. Only £2,000. Now meet Dr. Helen. Dr. Helen is a 65-year-old consultant who is about to retire. She has the same £100,000 available, but she puts £50,000 of it into the same startup because she wants to catch up. She has not been investing for years. It's the same company, it's the same investment. £2,000, £50,000. Now the same thing happens if it fails, but is it the same risk? Absolutely not. If Dr. Priya here loses her entire £2,000, that's really painful, but she's lost 2% of that £100,000. She's still earning and potentially has decades ahead of her to recover. Now, if Dr. Helen, on the other hand, loses £50,000, she's lost 50% of her money she was relying on, especially as she's just about to enter into retirement. Now, the investment didn't become riskier. It's the same investment, the same risk. The consequences of the risk just changed. That's why I don't only ask, how risky is the investment? The question that I ask, and I think you should ask as an investor if you're planning to do proper investment, not gambling, is how risky is this investment for me? If the company goes to zero, Priya loses only £2,000. It's painful, it's annoying. £2,000 is quite a bit of money as well. I know what I could do with £2,000, but it's potentially recoverable. They still have income. They have time. They can rebuild. Now, Helen, on the other hand, may need to change their retirement plans. They might need to go back to work, do a few night shifts and weekends, sell something, change their lifestyle, or change their retirement plans. And crucially, they may not have another 30 years of earnings available to rebuild what was lost. Same investment, completely different consequence. So that's why I don't only ask how risky is this investment? I ask how risky is this investment for me? And that's where position sizing becomes incredibly important. And I'll explain it to you. An investment can fall 100% and have very little impact on your financial future if it represents 1% or 5% or 10% of your portfolio. Another investment can fall only 30% and devastate you because you put almost everything into it. Which is why I keep repeating something I've mentioned in my recent videos. Your conviction, you believe it's going to work out, and your position size are 2 completely different decisions. You can believe very strongly in an investment. You've done all the work and still decide it deserves only a smaller part of your portfolio. That's part of the R of my REST framework. R is for risk. All right. Enough of that risk and reward stuff. I know, I know, most of you are thinking, well, Dr. Helen Keller made more too. The company did well. Let's look at E for effort. Now, this is one investors routinely forget. People love telling you their returns. They rarely tell you how much work They did to get that return. Okay, someone tells me my property returned 15% last year, so it's better than bonds, some money in the bank. Okay, fantastic. Maybe even 20%. But let's finish the sentence. How long did it take you to find the property? Did you renovate it? Did you find tenants? Did you manage those tenants? Is one of your tenants planting cannabis on the roof? You know, have you been called by 2 PM to fix a toilet? Oh, your agents called you the next Okay. Arrange insurance, do the accounts, deal with empty periods, replace the washing machine, and then at 11:47 PM on Sunday night, hello landlord, the toilet is not flushing. I've been a landlord, so I know. Okay. I don't have those kind of tenants. I'm very fortunate. Now compare that with somebody who has an automated direct debit going into a diversified fund every month. That's it. It's set up automatically. They go to work, live their life, come home, eat dinner, go to Both of you may be building financial freedom, you're building wealth, but they're not necessarily having the same investment experience. And once you include effort, the E, those headline returns are not necessarily comparable. I'm not saying property is bad, you see. I'm not saying passive investing is also automatically better. I'm saying that effort has a value. You have to factor that in. I've learned this myself through business. So businesses can generate wonderful returns, but anybody who has actually built a real business knows what I'm saying. Saying my business made 30% growth in revenue doesn't tell you the whole story because revenue is vanity, but profit is sanity, and cash is king. You've not talked about employees, customers, suppliers, taxes, messages, decisions, problems, things you have to consider, VAT. Sometimes you're lying in the bed physically at home, but mentally you're still at work. And as I've gotten a bit older, I'm an uncle now, I've realized something. My money is limited, it's finite, but also is my attention. I have unlimited attention or time. If I own 25 complicated investments and everyone requires phone calls, paperwork, monitoring, and decisions, I haven't necessarily built myself a diversified portfolio. I have 25 properties. I built myself another job. Okay. And maybe that's exactly what you want. If that's you, fine. But just understand what you're buying. You're not only investing money, you're also investing effort, of which you don't have an unlimited amount of it, and time as well. I received a message recently that captured this beautifully. It came from a doctor that I've worked with at Moneywise. Doctor, him and his wife—they've been thinking about retirement. Okay, this is a senior doctor, well-respected colleague, and one of the things he told me was that their thinking has shifted. Now, instead of necessarily trying to run businesses themselves in UK and abroad, and hiring people sometimes who do the wrong stuff, they are increasingly thinking about owning businesses just through investment, purely investment through stock market investment and index fund. And then he used a phrase I absolutely love. He said. We envisage a peaceful retirement in financial independence. A peaceful retirement. Okay. That's an important phrase because of the type of investment he had now made. They also told me that since after going through our mastermind financial coaching for doctors, they had invested more than £250,000 towards retirement separate from their NHS pension. And the important thing is not the £250,000. That's a quarter of a million. That's not small. Okay. It's what they are trying to build. They are not simply trying to maximize the number on a spreadsheet.

They're thinking of their children, their grandchildren.

They are building assets that can support their future without necessarily creating another business that they then have to spend their retirement running. They've already done that bit when they were younger. And I thought, that's rest. Okay? That's rest. Okay? Because sometimes the question is not, could I make more money if I run this business? Maybe you could, but perhaps you could. The question is, is that how I want to spend the next chapter of my life? Okay? If I buy 25 properties, I'm going to make money? Is that what I want to do? Because financial independence is not simply having enough money. It is time freedom. It's not just money freedom. It's having enough control over your time that you don't have to constantly have to exchange your life for money. And that takes us nicely to the next thing in the REST framework. S. I'll say S is for stress. S is for stress. Okay. So because this one almost never appears on an investment spreadsheet, there's nowhere you see stress. That could You can calculate the yield on a bond or yield on investment. You can calculate the return on an investment. You can calculate, even work out volatility. You can get the fees, even the hidden fees, taxes. But where's the column that says how many nights of sleep would this investment cost me? Am I going to lose all my hair just trying to work out this investment? Imagine someone comes to me and says, Andy, I've got an oil well for you in Venezuela. Don't tell anyone. And let's assume Boom! It's a fantastic oil well. It's a real one. And I have to battle with the US military, but on paper, it could make me 20, 30, 100 times what a boring investment could make me. Fantastic. But now every night I'm wondering, who is actually in control of the oil field? Could the rules change? You know, can I actually get my money out? Is production still going on? What's happening in the political space in that area? You know, what happens if the political situation changes again and another government comes and says, no, this is no longer yours? Okay, okay. I just be wondering why hasn't Jose Jose or whoever is in charge there answered his phone for three days? You know my point person down in that place. At some point, I have to ask how much is my peace of mind worth? Am I at rest? Because it could technically be getting richer, especially if all you count is money. Why simultaneously you are getting more miserable? You have no time for life, for your family, or to do anything. And this is where that old saying becomes useful. Some investments let you eat well; others let you sleep well.

You can either eat well or sleep well.

But I don't think. I don't think the objective should necessarily be choosing poverty so that you can sleep. No, the channel is Moneywise Doctor. The objective is understanding yourself well enough to find that balance. This is because 2 people can own exactly the same investment but experience completely different levels of stress. Now think about it. Imagine the stock market falls 30%, and I've lived through 3 stock market crashes. Interesting. I've seen this before. My emergency fund is intact. I don't need this money for another 20 years. So I can go to bed. I like the companies I already own and investments I own. Investor B might say, well, check their phone by 11 PM, check it by midnight, check it by 2 AM, check futures, check Reddit, check Twitter, check YouTube, and their blood pressure is going up and down, their pulse. Now, if you see a stock market crash tomorrow, would you be worried? Same market, same phone. It's a completely different experience for these 2 different investors because risk is not only mathematical. There's a behavioral component as well. And this matters enormously because the theoretically perfect investment strategy, if you don't stick with it, is still going to fail. But if every 20% fall makes you panic and makes you want to sell, what good is the whole calculation on a spreadsheet? Again, look at it from another dimension. You could own 10 rental properties, but anytime a tenant phones you, it makes you miserable. Or you have an agent managing the property, but they're stressing you out. Perhaps being a landlord may not be your route to financial freedom. And there's a strange irony there because if your route to financial freedom makes you feel financially imprisoned, something has gone wrong. Your portfolio should serve your life. Your life shouldn't serve your portfolio. I mean, this is the whole point about the REST framework when it comes to investing. So when I'm thinking about stress, this is different from E for effort. When I'm thinking about stress, I'm asking, can I own this and still sleep at night? Can I tolerate the bad years? Can I emotionally stick with this strategy? And is this potential additional return What the peace of mind I'm giving up to get it? That's S. S is for stress. You don't want that. You want S for sleep. And finally, we'll go to T. Very important one. T is for time. So when you go to T in the REST framework, R-E-S-T, T for time. And when I say time, I mean 2 completely different things. First, how long does this investment need to pay me? Okay, how long before it matures and pays me? Confuse me. Okay, if you've invested in startups, you know what I'm talking about. And secondly, how much of my time does this investment need? 2 different questions. So let's start with the first. Imagine you have a child, newborn. Okay, they're not going to start university for another 20 years, so you started investing for them. And maybe at some point someone said, oh, you've invested, you've accumulated up to £30,000 of this investment. Okay, what we'll do, let's put it into this particular You know, investment, okay? You know, you can, you can make some extra money and all that, you know, and you can make like triple of the money. So now you're thinking, what is the horizon? What's the goal here? What's the plan here? Um, you might think, well, I don't need this money to triple overnight because I've got like a long horizon. When do I need this money back? Because then that changes the equation. You don't need to follow all the rules to get there because time changes the amount of uncertainty you might be able to tolerate. But there's another kind of time, and increasingly I think this one is precious: your life. Your life. Your life is measured in time. This has become much more important to me since I became financially free in my 30s. When I was younger, I thought much more about you know how to grow financially. I haven't come from a wealthy background or anything like that, so how to grow? Now increasingly think about maximizing something else: maximize your life. No, not just about the time, it's about the value in it. Because money is to some extent renewable. If I lose £1,000, maybe I can earn another £1,000. But imagine an investment requires 10 hours of my time every week for the next 10 years. Okay, that's thousands of hours of my life. Now I can't compound those hours back for myself and my family and my peace of mind or my walks. I like to go on long walks in the woods. I can't buy them back as And I cannot manufacture another Wednesday afternoon with my wife and kids. So that changes how I think about investment returns. Imagine Investment A gives me 12%, but it requires 5 hours of my time every week. Okay. Calls, management, administration, dealing with problems. Maybe I might even have to be involved in hiring and firing decisions. Then there's Investment B. It gives me just 9%, and perhaps I spend 1 hour a year looking at it. Which investment is better? Well, I don't know in your own situation, and that's precisely the point. You cannot answer that question from 12% versus 9% alone. Perhaps the extra return could be worth the additional risk, but most times it's not. Perhaps it's not. But now we're asking the right question. At least we are reflecting on it. What return am I getting on my money and what is it costing me in life? So that's T. T for time. The same way, if you've got like someone, like a child's investment that you don't need for 20 years, I wouldn't put it in a savings account because I want it to grow. That's my own opinion. I'll actually have it in the market working hard. Okay, now let's look at some practical examples again. 2 investments. Investment A, 20% return. Investment B, 10% return. Which is better? At the beginning, you thought obviously 20%, but now let's finish the Investment A potentially gives you much higher risk, requires constant management, keeps you awake at night, takes 5 hours every week. Investment B, more diversified, requires very little management. You barely think about it. It takes almost none of your time. Now we are not comparing 20% versus 10% anymore. It's no longer 20% versus 10%. We are comparing 2 completely different lives. And maybe you still choose the 20%. That's absolutely fine. Rest is not designed to tell you which investment to choose. It's designed to help you to understand what you're actually paying for that return. That's not always obvious because every investment has a price. And sometimes that price is not money. Sometimes it's risk, effort, stress, And time. Back again to Dangote because there's this Dangote IPO which is ending. Takes me back to those Dangote videos that has now been seen by almost 900,000 people because about hundreds of people ask me, Andy, are you buying? Should I buy? What do you think the share price will do? But when I'm looking at Dangote investment, I'm thinking beyond how much could this make. I did the same thing with SpaceX IPO. I'm asking what is my downside? What happens if I'm wrong? How much of my portfolio would I expose? How much attention would this require? Would I be comfortable if the price fell 30% tomorrow? How long am I prepared to own it for? So what's my horizon? And perhaps most importantly, does this investment actually add something I need to the portfolio I already have? Because I don't need to own everything that will make money. I don't have to. You don't have to follow all the rules to London. Manchester. I don't have to. Neither do you. You could just pick a route or a couple of options. So the next time you are considering an investment, before getting excited about the potential return, I want you to rest. Risk— what could I lose? And if I'm completely wrong, what happens to my life? E for effort— how much work and attention will this investment require? S for stress. Can I comfortably own this and still sleep at night? T for time. How long does this investment need and how much of my life does it consume? Then ask one final question. Does this investment deserve a place in my life or my lifestyle? Not necessarily has somebody somewhere made money from it. There's always going to be someone who has made money from it. Those are 2 very different questions. And remember, Remember the question I asked earlier? What will this investment cost you to own? Because financial independence is not about spending your entire life looking after your money. There's much more to life than that. At some point, your money should help you to look after your life, the other way around. That's the real purpose of the REST framework. Now, if you want the REST checklist, I've put it below. It's completely free. And if you haven't done the risk-free investment of clicking the subscribe button, go ahead and do it now. It's completely free as well. So go ahead. You can use the REST framework, the checklist, use it the next time you're looking at an investment and to see whether it changes the question or your attitude to the investment. And if this video really helped you, go ahead and share it with someone else who's thinking about investing. Don't learn alone. And all the best. I'll see you in the next one. If you're not sure what video to watch next, next. Look on the screen, you'll see this video right here on your screen, somewhere on your screen. The clever YouTube algorithm thinks that this is the one that you find most useful. Go ahead and click it, and I'll see you next time. All right then, bye-bye.