OK, so you want to learn more about personal finance, but there are a lot of books to choose from, and limited reading time, so which one(s) to choose?
If you have time to read exactly one finance book, then my recommendation is Balance, by Andrew Hallam.
Andrew is a former schoolteacher and well known best selling author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School. He also runs finance seminars around the world and writes columns for a number of publications too.
What I like best about Balance, is how Hallam can give the reader practical investing and portfolio advice while also offering food for thought about our relationship with money, family, and friends. It's not just a collection of Hallam's personal beliefs either, though it's clear he subscribes to them. He backs up his guidance with evidence based research; see the 18 pages of studies and sources listed in the notes section at the back of the book.
The book is very readable, too. It's full of humorous anecdotes and Hallam is a very capable writer as he weaves hard facts into these stories to make what he presents more compelling and relatable.
Time for two books? Next on the list is Reboot Your Portfolio: 9 Steps to Successful Investing with ETFs by Dan Bortolotti.
Dan is well known in Canadian finance circles as a financial advisor, blogger, podcaster, and founder of the Canadian Couch Potato website. He has long advocated for using Exchange Traded Funds (ETFs) as a foundational investing tool.
With this book, Dan gives us a definitive and step-by-step guide to building a simple investment portfolio using index ETF investing.
Especially useful for new or inexperienced investors, the book walks you through the benefits of index investing and the downsides of "active" investing. He also dedicates whole chapters on how to pick the mix of assets that is right for you, and how to select the right ETFs as well.
The book even gets very tactical and teaches you how to choose the right discount brokerage, how to transfer your accounts from banks and other institutions, and how to place your first investment order.
If you are curious about index investing, about exchange traded funds, and about a do-it-yourself approach that can save you a lot of money by avoiding unnecessary investment fees, this is a terrific book to check out.
Time for a third book? Try The Psychology of Money: Timeless lessons on wealth, greed, and happiness by Morgan Housel.
Like Balance, The Psychology of Money is relatively short and very readable book that, as the title suggests, focuses more on behavioral finance and the relationship we all have with money and with investing. This includes insights that will make our investing journey more successful.
The book has 20 succinct chapters with each one focusing on one money topic and backed up by both historical examples of those that succeeded...and some that failed.
Aside for being super easy to read, I really like how it presented truly thoughtful, often counterintuitive. reflections our relationship with money, wealth, and success. It's a good sign that this book leaves one reflecting on these things and challenging ones existing beliefs.
In retirement, or considering retirement? A great book for Canadians is Retirement Income for Life: Getting More without Saving More (Second Edition) by Frederick Vettese.
With 27 years as the chief actuary of Morneau Sheppel, a Canadian HR services firm with over 6,000 employees and 24,000 clients, Frederick Vettese has spent entire career focused on retirement and related income sources. He's very well equipped to discuss retirement and that comes across very clearly in this book.
Vettese does this by introducing us to Nick and Susan Thompson, a couple set to retire with modest savings (probably chosen to represent a typical or average Canadian retirement scenario). He sets the stage for their retirement and then goes on to illustrate how the Thompson's retirement plan could end up going very poorly.
From here, he adds five "enhancements" to the Thompson's financial plan, dramatically improving their overall situation. In summary, those five strategies are: 1) cutting investment costs with exchange-traded funds, 2) delaying Canada Pension Plan benefits to age 70, 3) considering annuities, 4) having flexible spending habits based on market returns, 5) and as a last resort – a reverse mortgage.
These are non-nonsense ideas that can be easily implemented and that, sadly, often get short shrift from financial advisors. In part, this may be due to the commission and fee based structures of many financial advisors and investment firms being directly at odds with the ideas in the book, but that's another conversation for another day.
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