With visits to over 40 countries under her belt, Kat reveals that the secret isn't a wealthy background or a full-time travel job. Instead, it's a mix of hard work, frugality, and astute stock market investments. From her days juggling side jobs at Georgetown to working in wealth management and educating herself in personal finance, Kat shares her journey of funding travels through savvy investments. This episode is a blend of personal stories, investment strategies, and practical tips for those aspiring to turn their travel dreams into reality. Whether you're a novice investor or looking to optimize your travel budget, Kat's insights from past experiences and her recent overhaul of her investment portfolio offer valuable lessons in balancing risk, return, and wanderlust.
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Youtube Shortsleeve Travel with Kat Shortsleeve
With visits to over 40 countries under her belt, Kat reveals that the secret isn't a wealthy background or a full-time travel job. Instead, it's a mix of hard work, frugality, and astute stock market investments. From her days juggling side jobs at Georgetown to working in wealth management and educating herself in personal finance, Kat shares her journey of funding travels through savvy investments. This episode is a blend of personal stories, investment strategies, and practical tips for those aspiring to turn their travel dreams into reality. Whether you're a novice investor or looking to optimize your travel budget, Kat's insights from past experiences and her recent overhaul of her investment portfolio offer valuable lessons in balancing risk, return, and wanderlust.
Instagram @katshortsleeve
Tik Tok @katshortsleeve
Youtube Shortsleeve Travel with Kat Shortsleeve
Welcome back to the Short Sleeve Travel Podcast. I'm your host, Kat Shortsleeve. Today we are answering the question I am asked most of all, which is how do you afford to travel so often? I have been 40 countries. And I'm often asked, am I rich? Do I travel for work? Are my parents funding all of my travels? Do I have a sugar daddy? And the answer to all of these questions is no. I have funded all of my travels since I was in college, completely on my own. And when I did some volunteering travel when I was in high school, I funded that partially myself too. My parents definitely helped out back then. But I have basically set up my life to travel and a major way that I have funded my travel for myself is of course having a full time job, always having side jobs. When I was an undergrad at Georgetown, I had multiple side jobs all at one time, which I can get into and explain what those are in another episode. But this episode is about how I work a lot. I save a lot. I'm frugal, but kind of the X factor here is that I invest in the stock market and that has funded a ton of my travels. After graduating from Georgetown, I worked in wealth management in Boston, which is where I'm from, I spent so much time every single day reading Investopedia, first of all because I felt like I didn't know enough to be working at this wealth management firm. And I needed to educate myself. I hadn't studied econ or finance undergrad. And second of all, I just felt as though and started to realize that personal finance knowledge is complete power. Ultimately I found a lot of success in picking stocks. What I will have to say, and I want to caveat all of this is that I have actually completely changed my entire investment portfolio and my investment thesis as of yesterday morning. So this episode is all talking about the past, what I've done for the past five years that 40 different countries. And the next episode is going to be all about how I'm looking at my portfolio for the future and how I've completely changed my investment thesis. This episode is definitely about more risky way to invest in what I have done and luckily been successful doing, but it's not necessarily the advice I would give. It's just what I've done. And luckily it worked out for me. But I also understand that it's not the smartest and not the most sustainable long term solution. Which is why the next episode will get into actually some of my suggestions and how I'm looking and thinking about my portfolio for the future. For a little bit of background, I grew up in the Boston area. And before graduating from high school, I had traveled to Costa Rica and to Ireland with my family. We'd also gone to Spain and to France. And that was really the extent to my international travels. After I'd graduated from high school, I found this program called Rustic Pathways that brought me over to Fiji for three weeks. I worked and actually started a company back then to raise all of the money to fund this trip to go to Fiji. And it was during this trip to Fiji that I just realized how wide the world is and how my bucket list was going to be ever growing. This trip to Fiji with Rustic Pathways included all of these different kids from all over the world, very international group, and I learned from them just about where they were from, the places that they'd all been, and I was so excited to continue traveling and exploring. And I knew that I really wanted to make travel a large focus of my life. And so I definitely set up my life to be more around that. After that trip. I did my undergrad in DC at Georgetown, as I mentioned, and then I came back to Boston and was working in wealth management for two years in the Boston office until COVID began. And before COVID started, I had plans to move over to our Singapore office because I always knew that I wanted to live abroad and live somewhere international, and I thought this was the perfect time to. I had just gone through a breakup, and I thought it was kind of my opportunity to get out of Boston and go do something really different. So during COVID I worked remotely for the Singapore office from the U. S. and did a lot of travel within the U. S. later on during the pandemic while we were still working from home and I was unable to actually move to Singapore because of visa restrictions and Singapore was under major lockdown. They had so many restrictions going into and out of the country so I wasn't able to go over there. And so during COVID and during the pandemic, I lived out in Colorado with my sister, did a drive along Route 66, I moved to L. A. and met one of my best friends, spent a lot of time in Maine. This was such a nice opportunity to see more of the U. S., which I never really had plans to do. So that was a silver lining of that period of time. During the pandemic, I also realized that I wasn't actually going to ever be able to move to Singapore and continue this job because of all the restrictions and there really wasn't a light at the end of this COVID tunnel. So I decided to apply to business school, which was always part of my long term plan. And I moved down to New York City and went to Columbia business school. My class at Columbia Business School was extremely international, and I met so many people who were actually moving to New York City for our program from their home countries all around the world. We did so many trips during business school to places where students are actually from. So I went with a girl who's from El Salvador to her hometown in El Salvador. I went with a friend to India, Mumbai, where she is from. One of my classmates actually owns McLaren, the car company, so we went to London with him. We had trips to Greece and Italy and Costa Rica. We went to Austin, Texas. We went to Colombia. to Ecuador. And all of these trips were with people who are actually from the country, it was incredible. And so that opened up my eyes even more, and ever since graduating from my MBA program at Columbia, I've essentially been a nomad, during this time going to school in D. C. and New York, as well as working in Boston and working out west in Colorado and L. A., I spent a lot of time stock picking to fund these travels. And during this time I was actually able to double my savings. So I'm going to dive into my top tips and just explain to you what I did and how I got it done. I get into my top five tips, I actually just want to mention how do you even begin investing? Because it's something that's not really explained too much. So first of all, what you do is you open a brokerage account with one of these four companies that I recommend. The first brokerage account that I recommend is the one that I actually have my account with and that's Fidelity. I really like Fidelity because you can call them at any point in time and ask them questions. You always get a great customer service representative who will be on the phone and will actually just speak to and answer any questions. The second would be Vanguard. I have my retirement account with them. Also good, but they seem to be, in my opinion, a little bit more outdated and an older company. Definitely tried and true and very stable. Great company, but I think Fidelity just feels a little bit younger and better customer service, in my opinion. Fidelity also will actually give you advice. So I asked them, you know, does it make sense to buy this CD or this stock? And they'll say, well, we can't advise you on exactly what to do. My personal recommendation would be blah, blah, blah. So they're helpful and they will also execute trades for you. They're great. Anyways, the last two brokerage firms are TD Ameritrade. Perfectly great. And the last is Charles Schwab. The second step is you have to choose what you are investing for. And there are three categories. The first account type is going to be just general investing. And I'm guessing this is probably what the majority of people will be wanting to do. The second is going to be for retirement. And the third is going to be for education. So for example, if you are paying for school with, um, an investment account, you might open something called. A 529 plan, and this is basically a tax free way to pay for education, and you can invest into an account specifically for that. Similarly, if you're opening a retirement account in the U. S., I think you are 59 and a half before you're able to access retirement funds. For example, in a Roth or 401k, you can't access that until you are beyond the age of. 59 and a half. Step three, you are going to take Warren Buffett's advice and buy index funds. Um, essentially if you know nothing about investing, you can actually outperform most investment professionals. And like I mentioned earlier, I actually worked at a wealth management firm and a lot of times people who are professionals in private investments and hedge funds, they aren't even able to outperform the S and P 500 and typical ETFs. Warren Buffett actually suggests to have three different ETFs or index funds in your portfolio and Three that I like and recommend are going to be the following Number one is something called a VOO. This tracks the S& P 500 The S& P 500, it is a stock market index that represents, I believe it's 505 actually, of the largest companies that are listed on the public stock exchange in the United States. Basically, it is a broad snapshot of the U. S. economy. And it's typically used as a good benchmark for the overall performance of the stock market. It is a good way to diversify your portfolio just automatically, because you're going to have stocks that are across various industries. So you might think, why wouldn't I just invest directly into the s and p 500 index? But you actually can't directly invest into it, so you have to. So historically, the S& P 500 provides long term growth with an average return of just around 10 percent before inflation, and that has been the case for nearly a hundred years. And I'm going to come back to that piece about long term investors, so keep that in mind. I actually find this so interesting, but companies in the S& P 500 are selected by a committee. And that is based on criteria like market capitalization, their liquidity, financial flexibility, the length of time that they've been publicly traded. And so if you absolutely know nothing about the stock market or just how the market is trending, put the decision into the hands of other people who are analyzing this day in and day out. And there are committees that have to vote on these things. Put it into the hands of them and buy this ETF. So that is the first index fund. Reminder, it is VOO. The second index fund that I like right now and have liked for a long time is called QQQ. Definitely very difficult to remember. This tracks the NASDAQ, so essentially it's a tech and growth company fund. This is a more tech heavy investment choice, which is something that I definitely prefer to invest in. This is probably one of the best gauges of the performance in the tech sector in the U. S. And the companies that will be a part of this index fund, you'll recognize the names of them. Of course it's Apple, Amazon, Microsoft, Google. This is a really good way to have broad exposure to the tech sector without having to do a single investment. Historically, QQQ and the tech sector has been outperforming the S& P 500. So that's why that's a really popular choice for growth oriented investors, and I'm not sure who isn't a growth oriented investor. And the final and third index fund I'd recommend is called VT. So that tracks the entire world stock market and it's nearly 10, 000 stocks. Earlier I mentioned Vanguard as a brokerage firm. VT is an index fund that actually is owned and managed by Vanguard. And this fund, of course, has companies of all sizes, and it's the most comprehensive ETF in the market. It's going to cover, of course, the most sectors. And it'll include stocks from around the world, which I like. So it includes North America as well as Europe, Pacific, Middle East, emerging markets, and it's a good balance and a good mix of stability from developed markets as well as growth potential from emerging markets. I find that very interesting. VT is probably the easiest and most cost effective way to invest in global stock markets without needing to individually research and invest in thousands of stocks. So essentially the work is all done for you. Moving on, I want to talk about why I invest. So of course, I invest because it's a source of income and I invest and I have been picking stocks historically. Because there's potential for higher returns versus just traditional savings accounts. The main difference between stock picking and traditional savings accounts is that traditional savings accounts will be a very safe place to keep your money. They're typically insured up to a quarter of a million dollars. So it's a lot of stability. It's a lot of security, but these are going to be very low interest earnings. So the interest rates compared to other investment vehicles is tiny. At the same time, they're highly liquid savings accounts are. So this means you can easily access the funds without any penalties, without any fees. And so it's perfect for emergency funds or short term savings goals. Again, there's such minimal risk here. And then the opposite end of the spectrum is what I've been doing, which is stock picking. Stock picking is the process of choosing individual stocks. with the goal of achieving this higher return than the overall market, or a benchmarked index. And a benchmarked index would be like the s and p 500. And so in this case, you're kind of analyzing and selecting specific stocks based on whatever your investment criteria is and doing your own research to find companies that you find most compelling. Stock picking is a form of active investment management where basically me as the investor, I select the stocks. As opposed to passive investing where you invest in an index fund or an ETF that tracks the market So those are kind of the very basics here. And now I'm going to get into my five or six top tips and pieces of advice as to what I did and what I think you should do if you are going to be stock picking. Again, I've mentioned this a few times, but this is what I've done to what I did in the past. It happened to work out for me I'm just sharing my story, what I've done, how I did it, and you can choose to do with that what you want. My number one piece of advice, and I learned this from my time working in wealth management, is that you should really be, and must be, investing for the long term. Um, even if you're just investing your savings and you're not investing a retirement fund, you should think about investing for the long term for a few reasons. Number one is going to be compounding returns. So long term investing allows you to benefit from compounded interest. So this means your earnings actually generate their own earnings. And over time, this will significantly increase the value of your investments. Second is going to be investing for the longterm will smooth out the market volatility issues. The stock market is very volatile in the short term. And so day to day it will fluctuate up and down, but year to year it will generally trend upward it is nearly impossible to time the market, so what you will hear if you take 101 investing, it's not timing the market, it is time in the market. So what matters more than anything is the amount of time that you actually spend investing money into the market and not actually timing the market. For that reason, long term investing mitigates the need to predict these short term market movements. And that greatly reduces the risk of the time that you actually enter or exit the market, you know. Let's say you enter at an inopportune time because you cannot predict this. And if we could predict this, everyone would be a billionaire. The last real reason why I think that you should be investing for the long term is this mitigates emotional decisions. So short term market movements can prompt very emotional reactions, I should be one to know, and impulsive decisions, whereas long term investing encourages more of a disciplined approach. You have to focus on overarching goals rather than short term market noise, and you're able to stay more committed to your investment thesis this way. And it will not drive you insane if you're just invested for the long haul. Oh, and finally, the reason why I really like to invest over the long term is the capital gains tax is actually lower when you have an investment into a stock, that's over 12 months. I think there's some difference between. If you're invested into a stock for more than 12 months, the capital gain tax is somewhere around 5%, whereas if you're invested into a stock and you have a capital gain and it's under 12 months, then it's going to be somewhere closer to 12%. I need to fact check that one, but I'm pretty sure that's what it is. I remember researching that a long time ago, but essentially I've almost always been really invested for the longterm. So I've been paying closer to the 5 percent capital gains tax. My second piece of unsolicited investment advice is going to be to diversify your investment portfolio. Okay, so to diversify essentially just means don't put all of your financial eggs into one basket And so you're going to spread investments across various asset classes Various sectors and probably geographies as well. And this will help you reduce risk Different assets, of course react differently to market conditions so if you want to balance out potential gains with potential losses When one investment basically underperforms, and the other might outperform, this will smooth out the overall portfolio over time. So I mentioned a few of the different ways that you can spread out your investments, and one of those is across asset classes, which will mean you're going to invest in stocks, bonds, real estate, cash maybe. Within an asset class, you'll invest in different sectors, so different industries. Geographically, maybe you're investing in both the U. S. or domestic, as well as international markets. And then finally, this is my favorite way to diversify, is through investment vehicles. So in that case, you're probably utilizing mutual funds, as well as ETFs and index funds. Which will inherently over diversify your portfolio. At the same time, you actually do want to, of course, Avoid over diversifying because if you're invested in absolutely everything, that will dilute potential gains. So, you want to strike the right balance, and typically, you've probably understood this by now, but investing in ETFs or index funds will be the right way to strike a good balance of diversifying. Tip number three, and as if this could not be more obvious, you want to pick the right stock. And you're probably wondering how should I know which stocks to pick? Essentially, in the way that I think about it, is you're going to want to find the industries or find the companies that seem to have some sort of competitive advantage. So, for example, if a company has some sort of innovation or corner on the market in some tech product, that might be a company that you'd want to invest in. Or if a company has some sort of market dominance in an area, They're really leading a charge and making a lot of investments into R& D in their company in that area. That might be a good company to invest in. I know this is really vague. Let me try to be a bit more specific. I guess to do so, what I should probably mention is what worked well for me. And over this past year, 2023, I picked a lot of stocks in the technology sector. So despite this being a very volatile sector, Technology companies, especially those with very strong fundamentals and innovative products, they have long term growth potential and they did really well in 2023, as well as 2022. You could probably just Google top technology stocks and know which ones I'm talking about. Another major stock for me was the healthcare and biotech industry. So I, for some reason got very lucky and had invested in this in 2019, right before the pandemic. And so biotech companies, companies in Boston and healthcare did really, really well. The third main area of stocks that I've been investing in is green energy and sustainability. This is just a passion and a major interest point for me, there's also been this shift towards renewable energy resources and sustainable practices, so that's been driving a ton of growth in these green energy stocks. Additionally, throughout the pandemic, something I invested in because I saw a major trend here was consumer goods. So companies that produce essentially consumer goods, they can be very stable, especially during economic uncertainties like the pandemic. Finally, an area of interest that is again just um, something I really enjoy investing in is going to be in artificial intelligence. Companies that leverage AI technology, they are, More than more likely than not going to be promising investment opportunities. But at the same time, similar to Evie companies, you know, you need to pick the right companies to be investing in. There are so many Evie and AI startups at the moment. And I was just listening to a podcast today that was talking about the five top Evie startups from 2023 have essentially gone bankrupt and Tesla is taking away, uh, cannibalizing all of their, um, Market share? So, you know, picking these stocks is not a sure bet, that's for sure. But if you're going to do so, those are some of the best practices and kind of how I've been thinking about it. Tip number four is you want to be phasing into the stock market, but you do not need to be phasing out. And here is going to be the reason for that. So phasing in basically means that you're taking a fixed amount of money at regular intervals over a longer period to invest in the stock market. So let's say you have 1, 000 to invest in the stock market. Phasing in will just mean that you're not going to invest all 1, 000 on day one, you're going to invest 200 every single week for five weeks until you're fully invested. This will just mitigate risks of, of course, associated with market timing and it'll be beneficial for any new investor. You know, the market can be extremely volatile on a Flip of a switch. This is a much more disciplined way to invest, but on the flip side, you do not need to be phasing out. If you want to get out, you can just get out if you're an individual investor. So really large investors with positions that are worth billions of dollars, they will time their trades to avoid depressing the price of a stock while they're selling. It's really not relevant for small personal investors like myself. I don't need to phase out. If you're phasing out, it's probably for emotional reasons, which leads me into tip number five, and that is to have emotional resilience. I can really only try to emphasize this, but avoiding emotional decisions in the stock market and sticking to a well thought out investment strategy is truly the number one piece of advice that I would have, and probably what I didn't take into account. Too, too much over the past. I mean, that's not exactly true. So a lot of what I've done for the past five years is pick stocks that I had true long term convictions in, and I stayed the course. And so I watched a lot of people around me jump in and out of stocks, which will have capital gains tax that are higher. Whereas I would pick a stock, decide that I was going to stick with it for better or worse. And I definitely got very lucky and that it was always for the better. But no matter what you decide to do, if you're going to pick a stock and invest for the long term, just being emotionally resilient and avoiding checking the stock every single day and avoiding hopping in and out. Have conviction, think out your strategy, think out the companies you're investing in and, and just be emotionally resilient. Don't check it constantly and, you know, you need to know what's going on in your portfolio, but don't make emotional decisions. That's the overall piece of advice there. And that leads me into tip number six, stay informed and please keep up to date with market news. So understanding the impact of current events on investments to me is very interesting, first of all, but it's also pretty necessary if you're going to be investing into the stock market. While I didn't have a lot of movement when there were major downturns or market volatility, I like to still stay on top of what is happening. So if you have a Company that you've invested in and you keep hearing in the news that something major is going on with them You know, there's no sign of hope for them long term That's not an emotional decision to then evaluate that new information that you have and get out of that stock. That's an informed decision. So Stay informed keep up to date Try to be emotionally resilient as possible Diversify. Go with ETFs. When you're picking stocks, make sure you're doing your research. Phase in with your investments and spend a lot of time in the stock market and spend less time trying to time the stock market. These tips and educating myself about personal finance have helped me go around the world and back a million times. Honestly, probably 200 300 times at this point. And I'm so grateful for the access to investment advice that I have received through Fidelity, through my own research and Investopedia, through Connections, that I've made in the investment space, through work, through school, and I want to bring a lot of that to my platform, because it is kind of the truth of the inner workings behind all of my travels, and how I've really made it possible. It's something I'm super passionate about. I love personal finance. I love credit cards and I'm really excited for my portfolio going forward because like I said, I've completely changed it. And so I'm really excited for the next episode and I'm going to talk all about my new investment theory and the new way that I've completely transformed my portfolio for the longterm. Given some personal circumstances that are going on. And I've been thinking about changing my portfolio for quite some time and I did not phase out. I actually just was sitting in my car and um, sold everything through my Fidelity account on my app yesterday. So I'm going to walk you through that experience and I'd really just motivate you to consider stock investing to help you fund your travels, help you fund whatever it is you want to be doing. Please make sure you are doing it with an informed decision. No harm in getting a little financial planner or spending tons of time on Investopedia like me. Okay, thank you all so much for tuning in and for listening to how I have invested in the stock market to fund my travels. If this has been helpful to you, I would love to hear it. You can reach out to me on any social media platform. If you think there's someone in your life that needs to start investing, needs to start saving for the future, send them my way. And if you have any questions about finance and travel and how I've made it all possible or investing, feel free to drop me a note and I can answer it in the next podcast so, thank you all for listening, thank you for tuning in, and you can now find this podcast on Spotify, Apple Music, Google Podcasts, iHeartRadio, it is all over the place now, which I'm so excited about, if you could leave a comment if you've enjoyed it, and leave a rating, I would really, really appreciate that. So excited for the next episode, it will be out shortly, thank you all, cheers.