MSG Presents : "Eric on Money" - How To Own Your First Company, Stock Market Investing 101

In this kickoff to the Stock Investing for Beginners series, Eric breaks down what most financial pros skip — the real reason 53% of people don’t invest. It’s not about money. It’s about knowledge, mindset, and confidence.

Eric shares:

• What a stock really is (minus the jargon)
• Why the market exists and how to use it wisely
• How to prepare financially before investing
• How to open your first brokerage account
• The #1 question to ask before you hit “buy” on your first share

With stories, clear steps, and a touch of real-talk financial therapy, this episode is your permission slip to get started — no MBA required. Whether you’ve been stuck on the sidelines or just need a confidence boost, this is your quick-start guide to owning your first piece of the market.

**All content provided through this platform is for educational purposes only and does not constitute legal, investment, or financial advice. When it comes to personal decisions about stocks, bonds, life insurance, estate planning, or financial planning, always consult a licensed professional.

Transcript

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Good morning. [00:01:00] Welcome my name is Eric McLoyd. I'm very excited to have you all join me this morning. As we start, I wanna really talk to you about why I decided to do this event in the first place. I did a poll this week, I think it was at the beginning of this week or late last week, and I was asking people on LinkedIn, you know, what do you think is stopping you from investing in stocks?

And I was really curious to know what the answers would, would come back being. And guess what? 53% of the people said that the reason why they were not investing. And stocks was because they did not have the knowledge. They did not have the knowledge, and that bothered me. That did bother me. The second thing that people said was that [00:02:00] they did have the money, and I think some of the, and I think that was about 33% of the people, and then I had two other things.

One was. You know, I, I don't really want to invest in stocks. I like doing real estate or some other investment type or, you know, I'm just not interested overall. So that 53% really bothered me. It really did. So I decided to do something about it. I put this together and this is really designed, you know how I am, if you view my content on LinkedIn, I really, I love to get into mindset.

I don't like to jump directly into. A topic without getting into the mental part of it. So we're gonna do the same thing here today. So let's dive in.

My name is Eric mlo. Some of my credentials are MBA in corporate finance, Northwestern University, Kellogg School of Management, alum, decade in the [00:03:00] financial industry, financial coach Fractional, CFO.

And my favorite one is I am a former financial imposter. And if you look at my content, I talk about that a lot. It just means that I did not believe that I deserved to have financial success. I did not believe it. All right, so let's do it. Let's get into it. So here, this is designed to be a guide, and so the main thing that I kind of understand from working with hundreds of people about money is when people tell you what the problems are, you need to pay attention.

Into it. So people definitely said, I don't understand it now. I was surprised about that because we have a lot more content on social media about investing, stocks, real estate, all these different investment vehicles. So for people to come back and still say [00:04:00] they, well, I'm still not sure how this works or how to invest, I just thought that was very interesting.

But I did ask somebody about that and they kind of told me that, you know, it's like the video is great. But you need the repetition and you need to explain the how and why. And so with that, I wanna get into how the stock market, actually, how does it work? So the first thing that we really want to think about here is that when you buy a stock, at the end of the day, you're just buying a piece of a company.

A piece of a company. That's what a stock is. It's a fancy word for a piece of a company. It's no different than if your cousin started a lawn care business and they allowed you to get a piece of that business. It's the same thing. You are taking a risk and you can lose your entire investment. You can lose it all.

And whenever you see that [00:05:00] word investment in anything that you're doing, whether it's insurance, you know, retirement products, whenever you see the word investment. That is synonymous, synonymous with risk. It means that you can lose all of your money. So you are taking a risk. Now, the market itself, so that's what a stock is.

So you're buying a piece, and I, and I'll tell you, we'll get to this a little more later. What's interesting now about the stock market is when I first started, you couldn't really do this, or I wasn't aware of it, but you can buy pieces of a share. And we will get into that more. But like you now, you don't even have to buy an entire share.

You can just buy a piece of a share, which is pretty cool because it allows more people to get into the market. Now, what is the stock market? So the stock market is a place where people come together to buy and sell those pieces that we talked about. So everybody's getting their pieces of these companies, but you need a place to do it.

And that's what the [00:06:00] stock market is. It's no different than you going into a grocery store and you know you're going in there to do a transaction. You're going in there to buy food. Same thing here. You're going into the market to buy pieces of these companies. Now why are these companies in the market?

Why do they have these shares available for investors? Some companies, they wanna raise capital from the public. And so we refer to those companies as publicly traded companies, but, and they're the opposite of private companies. So you have some companies who are private. I believe one good example would be Chick-fil-A.

I believe Chick-fil-A is a family owned private company, so it's not traded in the stock market, and so you're not able to. Invest in it. And so those people, you know, for whatever reason, they don't want the public's money to grow, [00:07:00] but publicly traded companies do. And so they are putting their company on the, in the market so that these investors can have the opportunities to get their pieces of the company.

Now, why? Because they're trying to raise capital. So they're using other people's money from this public. Entity or this public situation, they're saying, Hey, we have pieces of this company available. Come get your piece. And by you going, when you go get your piece of the company, they're taking that money or that capital and they're using it to build their company and grow.

So they're doing research, they're developing new products. They might be hiring more people to work in the company. You know, just a variety of different things, but they're, they need your money. That is called capital. So they're taking that capital and they're using it to grow. Now here's my step two 'cause this is a startup guy.

So this is designed for you to say [00:08:00] it's very linear. It's a 1, 2, 3. So step one was, hey, before you get in the market, make sure you understand what it is. So we talked about what a stock is. We talked about what the market actually is. Now that you know these things, I want you to, to start preparing. So you might say, okay.

This is for me. I want to come in. I want to come into the market. What I want you to do is set up an emergency fund. Set up an emergency fund. Now, I know people are aware of what an emergency fund is. I'm, I'm suggesting three to six months of expenses that are liquid, meaning you can get your hands on the money if you need to.

You don't wanna start investing. And don't be like me. So when I first started doing investing in stocks, I would have to cash out my stocks to pay for emergencies. And that's what I don't want you to do. So I'm saying get the [00:09:00] three to six months of expenses that are liquid so that when you have emergencies, you can pull from that and you can leave the stocks in the market so that they have the time to grow.

I've changed my position on this next part over the years because I used to say to people, don't even think about it. If you don't have that three to six months of expenses, don't even think about getting in the market. I've gotten a little bit older, maybe a little bit, maybe you could say wiser, but now I'll say you can still get started.

Just decide. Here's the key thing. And this is a term that I use a lot when I'm working with people called discretionary income. Find out what's your discretionary income, and all that is is you taking your monthly income and subtracting it from your monthly bills and expenses. Okay? Once you do that calculation, so say you bring in $6,000 per month and your [00:10:00] bills are $5,000 per month, you have a $1,000 in discretionary income.

What I'm suggesting you consider as a strategy is once you've identified that thousand dollars, take a piece of that and use it to invest regularly in the market so you have a thousand dollars left over. Maybe take $100 and use that to go into the market. And then you could take the remaining $900 and use it to start building up that emergency fund so you really can do both at the same time.

Number three, know your risk tolerance. Know your risk tolerance. Super important. Now, why do you need to know your risk tolerance? Well. It's super important because you know, we get into mindset again, and so we know that people can get into the [00:11:00] market. It's really very easy these days. It's easier than it's ever been, but there are some mental and emotional factors that we're going to have to consider.

Now, when we say know your risk tolerance, this is just a fancy way of saying, can you handle, can you handle it if your stock is losing money? Can you handle it? If your stock is losing money, that will let you know what your risk tolerance is. And you know what, I was telling somebody this earlier in the week, this is more theoretical, but I feel like this is one of those things from my experience, that you have to actually do it to know what your risk tolerance would be unless you've done other things and you can kind of, you already sort of know, for example.

Maybe you're a person who, you know, you like to gamble playing cards or something and you lose, and you get highly upset when you lose $50 [00:12:00] or you're a person who you know, you just don't like your money to lose value at in any type of way, in any scenario, at any point. If you're that type of person and you already know that just from living your your normal life, then.

You probably have a low risk tolerance. Now, let's use an example. Let's say you bought Coca-Cola stock, which is one of the stocks that I've held for a long time, and say you bought it at around $59. You woke up the next day and it's $48. So of course you're excited. Initially, you got the stock, you know you finally got into the market.

You bought Coca-Cola. Maybe you're a big Coca-Cola fan. You don't like Pepsi. You're a big Coca-Cola person. I'm a Coca-Cola guy. You bought it. And, but the market is doing its thing. Maybe the market is extremely volatile. And then you wake up and it's now it's $11 less than what it [00:13:00] was. So you've got your piece, you got your piece of the company, which is great.

Your peace costs you $59. You woke up the next day, it dropped to $48. How would you feel? How would you feel about that? Would it bother you? If not, then maybe you have a higher risk tolerance. You might have a moderate risk tolerance, or you might have a very high risk tolerance. So say you're a high risk, you might look at this and say, you know what?

This doesn't really bother me because I believe the market is going to go back up. But if you start to freak out again, you probably have a low risk tolerance. You do not believe that you're in a situation where you want to, to wait for the market to go back up so that you can get back to the same value that you came in at.

And I tell this story about my dad a lot in some of my [00:14:00] content. He was a person that I feel like had a low risk tolerance, so he would invest in the market. The market would go down and he would start to freak out. He would start to sell whatever shares he had left and get out of the market. He had a low risk tolerance.

It's not wrong, right? Whatever it is, just that's who he was. Now, there's some things that he could have done to probably minimize his risk, but at the end of the day, he had a low risk tolerance and that's, that's what it is. I would say my risk tolerance is probably. Moderate to high because from my experience, I've just seen that if my stock goes down, it's going to go back up at some point.

So I don't really worry about it as much depending on, let me say this caveat, I've usually done a significant amount of research on the stock, and we'll talk about it this in later on in the series. But I'm secure with the fact of how this company is going to perform over time [00:15:00] because I understand what they're going to do to try and grow.

So I do wanna say that. All right, step four. So now you know what a stock is. You understand what the market is. You're pretty okay with the fact that, okay, I either have an emergency fund, or I've determined how much I can put into the market while I'm building my emergency fund. You figured out your risk tolerance, and now it's time for step four, which is, hey, open up a brokerage account.

Open up a brokerage account. Now, this is something for me that I don't know. For some reason it was just very, I'm using this for a lack of a better word, but it was just kind of scary for me to open up a brokerage account. I don't understand thinking about it now. I'm not quite sure why. Maybe it's just because it was something new and I felt like if I made a [00:16:00] mistake, my money would just dis just disappear or something.

But I learned that that wasn't the case, right? So you can set up your brokerage account and you don't even have to, to deposit any funds initially. You can just open up the account and get everything set up, and I do want you to do that. That's step four. A brokerage account is just like your bank account.

It's just a place to hold something for. So for your bank account, you're holding your savings account, your checking account funds. Things of that nature. But in a brokerage account, you're holding the stocks that you buy, so it's your container to hold the pieces of the companies that we talked about that you buy.

It's the place that you're going to hold them so that when you log in and you're looking at your account on your phone or your computer, you can always see, these are the stocks that I own. This is what I own in real time. I [00:17:00] own. Five shares of Coca-Cola, 20 shares of Apple, three shares of Walmart, whatever it is.

But your brokerage account is where you would hold those stocks. It's also though the place that you will buy and sell. So you say you get your first stock that we talked about Coca-Cola, and then you're like, okay, I'm gonna get some more stops. As you continue to go through that buy and sell process, then you'll have all of those transactions taking place.

In that brokerage account, which is great, it's a central location. You'll be able to put the, the protection on your account, you know, because people are always trying to get into our accounts and do fraud and all this other stuff. But you'll be able to put the two step authentication on your account and all of that stuff.

So it's hard for people to get into it. And then as you buy and sell, you'll do it out of your brokerage account.[00:18:00] 

Now, here's the big question, and one some point this year, I think I'm going to do a stock challenge. But the big question is, and I get this all the time, yeah, Eric, I know about a brokerage account, but which one do I need to get? Which one? And my answer to that is, is this. It, you're gonna get the one that you feel the most comfortable using.

It really is something that you need to have a really good user experience with. It's just like how we go out and we purchase computers and laptops. I'm a, I'm an Apple guy, so I like, you know, MacBook Airs, MacBook Pros, all of the Apple products. Why? Because they're the ones that I feel the most comfortable using.

Where other people, they might like PCs, you know, they'd rather have a PC device, a Google, Chromebook, whatever it is, but it's because they feel more comfortable with using that, which is fine. [00:19:00] But when you get into the comfortability, I also want you to look at a couple things. One, I want you to think about, do they have this, and we're talking about brokerage accounts.

Do they have educational tools? Do they have customer service options? Meaning, can I get in touch with someone if I have a question? Can you indicate a beneficiary to your account? So even though, and we'll talk about this particular brokerage account in a second, but like Robinhood is one of the ones that many people use and I've used, one of the bad things about Robinhood at one point is that you could not indicate a beneficiary, which was very risky because.

If something happened to you, where would your account go? Like what would be the legal documentation to say, oh, it's supposed to go to my brother, or my mom, or my cousin, or whoever it is. And so now they have that. But you wanna make sure, and that always made me feel uncomfortable [00:20:00] initially, but you want to make sure that you can indicate who your beneficiary is.

On your account. The other thing is we're all, we always have our phones in our hands. We're always doing something with our phone. I'm sure most people do their most of their banking with their phone. Same thing. You wanna make sure they have a phone app that's easy to use. And when we're talking about easy to use, we're talking about easy to make trades, easy to get.

The educational tools, and I'll talk about the educational tools a little bit. And we're gonna dive into this as I do more parts of the series, but the educational tools are super important because we're, you're talking about beginners and in beginning you wanna read as much as you can about the different stocks.

You want to get news reports, you want to get tutorials about how to make a trade. All these different things. I feel like [00:21:00] some apps do it better than others, but that's going to depend on your style and how you like to see information displayed. I personally like bright colors. I like it to look. I wanna usually have a white background.

I know some people like black background, so you might want to look at, do they have an option to switch between the two? I wanna be able to hit a button on any screen and get more information. You know, you wanna make sure it is user friendly in the way that you like to get information. Doesn't matter about how anybody else likes to get it.

It's how you like to get information. There's no right or wrong in terms of which brokerage account. There's no right or wrong. It's what you feel most comfortable with until something happens that makes you feel uncomfortable. And if that's the case, you know, you can always transfer your funds out of your account.

Set up another account somewhere else. Now I do, I want to mention this when we [00:22:00] talk about the brokerage account. So what's going to happen is you're gonna set up your account and you're going to sync it up with a savings or checking account that you can use to bring in the funds. So let's think about it.

So you've already done the research and you're like, okay, I want to purchase some Apple shares. You have to have the money available to be able to make those trades. And so you would sync up your account with the brokerage account so that you can make those transfers. And in that way, when you're ready to make the trade, it's there.

So test those things out. Don't get so caught up in Don't do what I did, and think that, oh, if I get this brokerage account, it's the end of the world of things. Don't go right again. You can take your funds out whenever you want. It's your money. It might take a few days for it to transfer out, but you can transfer it out and set up another account or you can just not put any money in and just play around in the [00:23:00] app and experience it to see if this is something you feel is user friendly.

Now, I do wanna give a few examples here of some brokerage accounts, 'cause I think that's important to just have some examples. So Fidelity is a top ranked online broker, and I do encourage you call them any of these companies initially and have an initial conversation with them. Again, you wanna see how they, how they approach customer service.

Don't worry about only have a hundred dollars in there, it doesn't matter. I don't care if it's $10. Your money is in there. If you're in a good brokerage account you know, a good brokerage company, they're gonna treat you as if you have a million dollars in there. It doesn't matter. Merrill Bank of America is another broker.

I keep talking about Robinhood, which I think is good for initial early investors. I don't think it, it's good when, once you become more of a seasoned [00:24:00] investor, but I. Early stages, it's good because they do a lot of, they have a lot of educational tutorials that tell you how to do things, how to make a trade, how to do different types of trades.

They give you the perspective on the people who think they call the bears and the bulls. The people who think the market have a positive view of the market. People who have a negative view, they kind of show you both sides. And I like the way that the colors are set up in terms of my experience to my senses.

Pretty good. So check out Robinhood again. You can set it up. You don't have to start with any money, or you can put a couple of dollars in there when you're ready to start trading. E-Trade has been around for a long time. A lot of people love E-Trade and you can go online or read the reviews of these different account brokerage companies, but don't get too caught up in that.

Don't read so many reviews that you use. You stop moving forward. So the goal here is to just find one that you can get started with. [00:25:00] Set up an account. Get your account set up so that you can transfer money when you're comfortable and play around with the app and understand how to do things, how to make the trades, how to get the information that you need.

We bull, I think, is relatively new, and then TD Ameritrade has been around for quite some time, so you can't go wrong there.

Again, set up your account, test it, see how easy it is to understand and use. Do they have easy access to reach research? Research is going to be our best friend. Customer service is going to be our best friend because we're going to need more information and we're going to need customer service people to walk us through certain things that we need to do in our account.

And since this is a quick start, guide, deposit your first fund, whether it's $10, a hundred dollars, or whatever it is, so that when you find a stock that you like. You ready to go? You're ready to purchase. You don't want to find a [00:26:00] stock and have it at be at a really great price, and then you have to spend the time transferring over the money.

Granted, some of these apps are do will do it instantly or give you a credit while the transfer is actually taking place. But again, if you already know that you have a hundred dollars available or a thousand dollars, go ahead and trans consider transferring it over and have it ready to go. Now this concludes part one.

Again, if you have any questions, throw 'em in the chat. I don't want to make this too long. I wanted this to be short and easy to digest. We can do a quick recap. So we talked about how the market, what a stock is. You're buying a piece of a company, you are taking a risk. Again, when you see that word investment, you know there's risk.

The market is somewhere where people come together to buy and sell. We talked about that. Why raising capital? It's the opposite of a private company. They want investors to have opportunities so they can [00:27:00] use the money to grow. I'm suggesting that you set up an emergency fund. Three to six months would be great.

Hopefully it's liquid so you can get your hands on it. You don't wanna have to start investing and then have to cash out, figure out what your discretionary income is, subtract your monthly income, minus your monthly expenses. Take a portion of that to get started. Know your risk tolerance. So what kind of person are you when it comes to taking risks?

You know if you wake up and your account is down, how are you going to feel? Are you gonna feel okay with it? Or are you going to, as I said, freak out? If you're gonna freak out, you have a low risk tolerance, which is fine, but you have to remember that if you have a a low risk tolerance, that's going to dictate how you invest in the way you approach things.

Talked about setting up a brokerage account. Brokerage account, again, it's just like your bank account. It's where you hold your stocks that you buy. It's the place where you're gonna do your ongoing [00:28:00] transactions, where you buy and sell. You are gonna find the one that's most comfortable for you. I cannot stress this enough.

Not for someone else, not your mentor or your coach, whoever for you. Once you find the one that you like, you're gonna have to probably to do that, test it. Set up an account. You don't have to deposit any money yet. Play around with it. See how you feel. A couple of brokers you can start with. This is by no means the entire list.

This is just a few of the most popular ones. Again, I like Robinhood for newer investors, Robinhood is not perfect and none of these are perfect, but you're just trying to one, find the one that's good for you. Set up your account, play around with it, and I should maybe play around is not a good word, but experiment with it.

Maybe before you even put any money in, just play around with it or experiment with it to see, do I like this app? Can I get on the phone with [00:29:00] someone if I have a question? Are they telling me information about these stocks before I actually purchase them? And then I want you to consider depositing your first funds.

Now this is gonna feel really good. I'm telling you this. I did all of the, the stuff that we're talking about now, and then when I got to the point where I actually transferred the money into my account, I was super excited because I felt like I was actually about to be in the stock market. So even if you transfer over like a dollar or $5, just make that first transfer and get that excitement.

It'll feel good. Now, I always like to carve out a few minutes to talk about many times when I'm presenting information and people will say, Eric, you know what? This is great. I love it, but I just don't think that I can do this alone. I just don't think I can do it alone. I need some help. For some people, I do recommend considering financial [00:30:00] coaching.

It's just a tool to help committed people reach their goals faster. You do have to be committed. It has to be something that you really want to do. I talk to a lot of people and work with a lot of people who say they are committed, but you know, sometimes you find out you're not as committed as you thought.

That's fine. But if you're committed, there's a journey that I'd like to take you on where you prioritize your mindset. Mindset is at the foundation of all the work that I do because as we know your mind, you can't do anything unless your mind is in the right place. You can't accomplish anything and be successful unless your mind is in the right place.

And so I focus on helping to get your mind in the right place, facilitate accountability. Sometimes when we're doing it by ourselves, I was the same way. It was like I really want to do this, but I need someone to hold me accountable. I need somebody to say, Hey Eric, you said you were gonna save three to six months for your emergency fund.

What's the status on that? You said you [00:31:00] were going to do it. Increase your financial literacy. Literacy puts you in a position where you don't have to always depend on other people to make your decisions. Over time, you will know the information. You'll know the same information that your coach or your advisor, whoever's presenting to you.

You want to get to a point where you know it as well. And then the developing new habits and routines. So part of the reason why some of us are in a situation now where we don't feel good about our our money or our financial situation is because our habits aren't good. The way that we go about things on a daily basis aren't good.

And it leads to situations where we're not satisfied. And so we have to work on developing new habits and routines,

an nazy from Nigeria. Great, sir, I'm glad to have you on. Super excited that you could join us this morning. [00:32:00] So designed to get you clear and we're talking about coaching. Clarity on where you stand. So where am I? Where do I actually stand? So doing an analysis or an audit to know where you stand. You wanna learn your key metrics.

What's my net worth? How much do I have saved for retirement? How much do I need for retirement? All these different metrics that we can use to gauge success. Literacy comes up again. We wanna expand it. Getting those answers to your burning questions. And then here's something I think is super important.

I don't think it's a good idea to continue to frame where we are financially in a negative way. We can reframe, reframe those financial challenges into goals. So say you're like, I don't have any money invested. We can flip that into a goal. We're going to get some money invested by the end of the next quarter.

So coaching will help you do that. Reframe financial challenges into goals. [00:33:00] Now, here's some of the benefits. Some people, well, the people I can say, and you can look at my testimonials on LinkedIn. Many of these people that I've worked with and anybody who works with a really good financial coach, you're gonna have increased confidence, accelerate your growth.

You're gonna grow faster because you have an expert that's helping you consistent and measurable results. Improve the literacy comes up again, reduce financial mistakes, direct access, access to an expert and a customized action plan so that it's clear what's going to happen over time. And number eight, which is my favorite one, is greater happiness.

When your finances are under control or you're, you're in a position where you're like, man, I'm actually reaching my true potential when as it relates to money, you just feel better. You're just happier. I can tell you that.

From experience, so I have two solutions that I offer. [00:34:00] One is called your CFO. Your CFO is an ongoing financial coaching. Weekly or biweekly sessions. . The investment is $500 per month with a one month deposit, or you can do a financial clarity audit, which is a complete audit of your personal finances.

90 minute session to review. Unlimited email access through your session date and investment of 2,500. So if you feel like either of those options will work for you, let's work together. You can DM me on LinkedIn. You can email me at emac Lloyd at Hubris Wealth us. And it's been a pleasure this morning to go through the stock conversation Again, if you watch the replay or if you're on Live now, if you have any questions, drop them in the chat and I'll be happy to answer them.

Until next time, I am signing off. I'm hopefully gonna do part two next week. [00:35:00] Peace.