Whether you have any interest in the stock market or not, odds are, you haven’t escaped headlines that read “Stock Market Tumbles” or “Election Results Lead to New Highs.” At times, it sounds like being in the stock market is a sucker’s game, something you want no part in, and at others, you have this gnawing feeling that maybe you’re missing out on a way to grow your money.

But those headlines are almost always a distraction from the larger point about the stock market, and the main point of this volume: wisely investing your savings is by far the simplest, safest and most common way of achieving long-term financial independence.

You may have friends that are incredibly interested in the stock market, and then those who know very little about it and want nothing to do with it. Great news: no matter where you are in the spectrum, this time-proven advice will be helpful. People who trade stocks on the side are often neglecting the safe, reliable long-term approach, and those who avoid the stock market are quite literally avoiding the most powerful and effective means of saving for their future.

Is it possible to achieve financial independence without long-term investing? Definitely.

But it will require plenty of risk, expertise, or luck—and maybe all three. The odds will be against you. But with the long-term investment program that we’ll describe here, the odds will be very much with you. There’s a reason why this kind of program is the most common path to financial independence: it works.

You are now in the driver’s seat of your money’s future value, and far too few millennials are taking full advantage of that control.

The days of very long career stints with a single employer, ending with a cushy pension at 65, have gone the way of dial-up internet and VCRs.

The idea of your employer investing your money for you so it’s ready and waiting on a predetermined retirement date is gone.

Right now, you can decide the timing, the speed, and the amounts of money going towards your financial independence. That control is an immense opportunity to be aware of how smart choices now can lead to meaningful wealth in the long-term.

But you have to know how to do it!

Learning how to save and invest for the long-term is much simpler than it sounds — just don’t let preconceived notions get in the way. If you’re thinking, “I don’t plan on needing my 401k when I’m older, I’m going to have a great startup idea and strike it rich,” or you’re questioning, “why would I risk my savings in the stock market when it goes up and down so wildly?” then let the next couple pages prove to you that long-term investing is the most effective, safest way to ensure your future is secure, no matter what happens over the course of your career.

When we say long-term investing, we’re talking about a time horizon that could be 40 years down the road. It’s hard to even visualize such a far-out point in time, but think instead of 40 years as over 2,000 weeks.

You can start to see how powerful it can be.

Imagine doing something once a week, like a dance class, or like learning a new language. Now imagine how advanced your skills would be after 2,000 weeks of practice. That consistency would get you close to the fabled “10,000 hours” needed for mastery.

Now take that mindset and apply it to your savings. A small amount of your paycheck, consistently applied, adds up to a relatively huge sum over 2,000+ weeks. Take into account that the stock market returns on average 6% a year (after taking inflation into account) and you’re multiplying your money over and over and over again.

“Compound interest” is a term that we heard in math class at some point, and all it really means is that your money grows, and grows more on top of that growth. Each time you invest a little more, you’re giving your money the opportunity to grow a little more. And if it can grow over 40 years, you can start to see the awesome potential.

If you were to take a dollar out, however, you lose that dollar of course—but you also lose all the growth that dollar would have provided. The minute you decide to shuffle money in and out is the minute you can no longer say that you’re invested in the long-term. In fact, you are now a perfect target for those headlines we talked about in the beginning. Financial media is built upon short-term “advice.” Buy Apple! Sell Chipotle! Sell Apple! Buy Chipotle! Each headline is accompanied by another one giving the exact opposite advice as the websites urge you to click on the one you want to believe. No matter which you click, they make a little more money in selling advertising.

The easiest thing to think right now is “but Apple has done really well over the past 10 years, I could have made a lot of money if I had invested in it”. That is undeniably true. But are you a full-time investor? There are people who dedicate their lives to investing and often they win just as much as they lose. Just like someone off the street couldn’t just walk in and do your job, you shouldn’t try to do theirs unless you’re willing to put in the same amount of time. Gamble your savings on a company just because you bought an iPhone and liked it? Think about using that reasoning on your boss. “Why is this a good idea?” “Because I have a good feeling about it.”

They’d send you out of the room to get research!

Is short- and intermediate-term investing inherently bad?

Of course not. Screwdrivers and saws are both excellent tools—but they’re poor substitutes for one another. Which one is “best” depends on what job you’re trying to do. Well, trying to safely navigate a 30- or 40-year course to financial independence through a series of short- and intermediate-term investment decisions is like trying to cut a board in half with a screwdriver—it’s going to be an exercise in frustration. Long-term investing is the right tool for a long-term endeavor. You have the opportunity to gain 6% on your money, year after year, with little time or energy required. This will free you up to put that much more time and energy into being great at your job, which will accelerate your progress towards financial independence even more.

Side note: If short-term stock picking is interesting to you, by all means spend the time and invest the money. Just don’t consider that as a substitute for, or an alternative to, a long-term investing program. Go ahead and go for it, but only after two stipulations are met: 1) your long-term investing retirement plan is already well underway and independently funded, and 2) you’re investing in small enough amounts that losing all of it wouldn’t materially change your life.

The 6% real return we’ve mentioned a couple times now – where does that come from? If you look at the stock market over time, you will see big swings both up and down. But draw a straight line from beginning to end and you’ll see a 10% return on average.

The graph above shows just how different short-term and long-term investing really are. It shows that if you held 500 major US stocks (this is a well-known stock index, called the S&P 500) for just one year, almost anything can happen. Based on the actual historical performance of the S&P 500, holding for a year might have gained you a whopping 57%. But you might also have lost almost half (-44%) of your money.

No matter how confident the experts in the financial media try to sound, the truth is nobody knows for sure ahead of time if the coming year is going to be a big winner, a big loser, or anywhere in between.

But now look how a little bit of time really calms things down.

This is the whole key to understanding long-term investing: it’s almost impossible to predict what the stock market will do over the next year, but it’s remarkably easy to predict what it will do over the next 30 or 40 years.

If you hold a broad mix of stocks long enough, the inevitable ups and downs of the market will cancel each other out, and you’re left with the underlying long-term trend.

What is that underlying long-term trend? Historically, it’s been between 9% and 13% growth per year; that’s why we feel that using 10% as the rule of thumb is on the conservative side. Remember, that’s based on actual historical market values. If you’re thinking that things are likely to be tougher in the future than in the past 100 years, remember that this history includes the recent Great Recession, the even more tragic Great Depression, world wars, the cold war, and all kinds of other dicey, dangerous scenarios. The safest assumption is that we’re headed for a wide variety of good and bad economic times, just like in the past. And it’s still true that nobody knows ahead of time exactly when or how they’ll unfold.

The dotted line on the graph is inflation (inflation is the reason candy bars that used to cost a nickel now cost a dollar—prices and wages go up over time), which has averaged about 3-4% per year over the past few decades. Now you see where the 6% that we’ve been referring to comes from. If you hold for a long enough time, your average return will be in the 10% range, minus 4% for inflation, leaving 6%. When calculated this way, the 6% value is referred to as the “real” return on investment.

Ready to really see this concept in action?

Invest $200 a month for the next 40 years and you’d have almost $400,000. If you were to wait and start in 5 years, you’d have only $300,000 or so. You can start to see the big differences caused by small changes. Want to devise a scenario or two of your own? It’s easy; just go to the financial independence calculator. In just a minute or two, you can show how your own quest for financial independence can get an amazingly powerful boost from a few decades of compound interest via long term investing.

We bring up waiting because short-term investors will tell you timing is everything. Invest at the wrong time, they say, and you could lose it all. However, don’t let their short-sighted advice cause you to wait a second longer getting started in your long-term endeavor. If you look at the stock market over time you will see a steady march upward, with drops (otherwise known as “bubble pops”) sprinkled throughout. For the people investing short-term during these drops, it must feel like the end of the world. For long-term investors, it’s as if nothing ever happened. These long-term investors know that stocks go up and stocks go down in a predictable cycle. They don’t know when the market will go up or down exactly, and they don’t need to, because when they think in 40 year terms, they know the 6% gain will hold. Doesn’t that sound like a much less stressful way to live life? Your adherence to long-term investing allows you freedom to focus on everything else that matters to you.

Avoiding this short-term stress over the next 40 years hinges on not checking the dollar amount in your long-term investment account. If you’re not going to sell, then why bother checking? All that matters is the number of shares you’re accumulating. If you think of it that way, every year is a good year for your long-term investment portfolio; because you finish every year with more shares than you started with.

Go ahead and peek after a few decades – and prepare to be astonished!

A Note from Colby Howard

When I had just graduated college, I was lucky enough to have someone explain the power of long-term thinking. She used the metaphor of your future self talking to your current self. Your future self is like a trusted old friend; one who brings a valuable perspective worth considering. You in 40 years would know that deciding to spend $2 instead of $4 on coffee every day, and then investing that $2, would mean an additional $100,000 in savings. With each of your days’ simple living expenses, ask yourself “what would my future self think about this?” Sometimes you’ll change your decision and go with the cheaper coffee; other times, you’ll feel sure that your future self would be A-OK with the costly but necessary trip to your best friend’s wedding. The wedding, the coffee, and the 6% can all coexist, no matter what your income and geography. It’s up to you to decide what’s truly valuable in your life. All we are trying to do is advise you that what is small now can be very big in the future, and such a prospect should be on your list of “truly valuables”.