Book Review

Book Review: The Wealthy Barber Returns

August 29, 2011

19 comments

As I mentioned in an earlier post (See The Wealthy Barber is Returning Soon, July 6, 2011), I thoroughly enjoyed David Chilton’s The Wealthy Barber Returns (listed at $19.95 and available from Chapters). Instead of a regular review, I’m just going to list the ten reasons why I really liked this book:

#10. Dave ditches the “novel” format and goes with the pick-any-chapter-and-you’ll-be-done-in-20-minutes format.

#9. Stories such as the one in which race horses star in an investment plan or how two cookbook authors stalked Dave into making an investment in their venture. Facts are sometimes stranger than fiction.

#8. The Conclusion. A farmer tells Dave his financial plan: live below the means, save a lot, invest it wisely. That’s all there is to it, really.

#7. If it’s so simple, why can’t everyone do it? The answer, Dave explains, is in our minds. And he offers a number of tips on how to “nudge” ourselves into becoming more financially responsible.

#6. Lest you think this is yet another tome that repeatedly hammers the “save more” theme, Dave has some insights into how to spend more meaningfully too.

#5. Quality Control. Dave’s PF hacks are all extensively tested in the field. They may not all work for you but you are certain to find some that will.

#4. It’s hard to change one’s mind even in the face of overwhelming evidence but Dave has no such problem. What about the advice in the earlier book about picking a mutual fund with a good long-term record and successful management team, eh? Nope, doesn’t work, says Dave.

#3. Dave’s endorsement of low-cost, broad-market index funds will help in spreading the message among every-day Canadians. He’s even coined some slogans: “Average is the new fantastic!”, “Be the most average you can be!” and “Average is its own reward.”

#2. Personal finance is often, well, personal. Dave explains the nuances of perennial PF questions such as “pay down debt or RRSP” or “RRSP or TFSA” or “how much should I save?” brilliantly.

#1. Humour. The book has some really funny parts. One example: Dave explains how one a trip to cancun, a hot tub purchase or a finished basement can all be rationalized as “emergencies”. Yeah, I’ve done that too.

Other reviews:
Larry MacDonald praised the book for making “personal finance less intimidating for the average Canadian and may get many of them to save instead of borrow and spend”.

Ellen Roseman liked Dave’s “psychological insights and humour”.

Dave was kind enough to include my quote in the book: “Brilliant! I liked it even better than The Wealthy Barber. If we incorporate even a couple of Dave’s ideas into our financial lives, we’ll be much richer for it and not merely in monetary terms.”

Book Review: The Investment Answer

February 1, 2011

1 comment
[Front Cover of The Investment Answer]

I first read about The Investment Answer by Daniel Goldie, an investment advisor and Gordon Murray, a Wall Street veteran in a New York Times article (see A Dying Banker’s Last Instructions, NY Times, November 26, 2010). The book was billed a sort of investment Last Lecture for Mr. Murray, who was dying from brain tumour. Sadly, just as the book was reprinted for wider release, Mr. Murray passed away.

I ordered the book from Amazon without any expectation of learning something I didn’t know already. After all, when it comes to passive investing, the authors will be preaching to the choir here. But I did want to find out if I can recommend this book to other investors.

The first thing you notice about this book is how thin it is — just 88 pages of generously spaced text. But it is packed with solid advice. The authors recommend that investors make just five decisions:

– Should you DIY or invest with an advisor?
– How should you divide your portfolio between stocks & bonds, small cap & value?
– How should you diversify within portfolio components?
– Active or Passive?
– Rebalancing: how and why?

I was a bit surprised (perhaps it shouldn’t be considering that both authors are associated with Dimensional Fund Advisors) that the authors do not believe a DIY approach is prudent when it comes to investing. They recommend that investors hire independent, fee-only advisors who will act as fiduciaries to their clients.

The book is available on Amazon.ca for $15. Investors of all stripes will find the book interesting and even enriching if they take intelligent action on the five decisions they are faced with. However, I do wish the authors had included a section on further reading for readers interested in an in-depth study of the subject.

Short Review & Giveaway: The MoneySense Guide to Retiring Wealthy

November 21, 2010

151 comments
[Front Cover of The MoneySense Guide to Retiring Early]

The MoneySense Guide to Retiring Wealthy, edited by Duncan Hood, Dan Bortolotti (a.k.a. Canadian Couch Potato) and David Aston, is an excellent, concise 130-page guide to saving for retirement in every decade of one’s life. Featuring columns that appeared in MoneySense magazine over the years and packed with fact-filled sidebars, the book attempts to answer questions such as “how much should I save for retirement?”, “how to retire early?”, “what to look for in a retirement home?” etc.

Mr. Hood addresses the question of who will find the Guide useful in the Introduction: “If you worry that you don’t have enough saved, or that you could be handling your finances better, read on. The solutions that follow are simple, they’ll save you money, and over the long haul, they’ll make your retirement dreams come true”.

The Guide is available at Wal-Mart, Shoppers Drug Mart, Loblaws and Chapters/Indigo for $9.95. You can also order it at moneysense.ca/nestegg for $9.95 plus $3.00 (S&H). You can read “Are you on track? “, the final chapter in the book, on The Globe and Mail website.

Full Disclosure: A copy of the Guide was provided by Duncan Hood. And in case you haven’t noticed, I write this blog under the MoneySense banner.

Giveaway

With holidays around the corner and retirement planning top-of-mind for most Canadians, I think this book would make an excellent stocking stuffer. And thanks to MoneySense, you can win one of five copies in this giveaway.

Entering in the giveaway is super simple. Just leave a comment in this post (please do not send an entry via email) and don’t forget to include your email address. If you are reading this through your favourite RSS Reader, you have to click through to the website and scroll to the bottom of the page and type in your comment. Some quick rules: (1) Deadline for entries is 11:59 p.m. EST on Friday, November 26, 2010. (2) One entry per person. (3) Canadian residents only. (4) I treat your privacy very seriously. Your email will be used for the sole purpose of contacting you if you happen to win. (5) I’ll pick five entries at random and announce the winners after the deadline.

Update: The website suffered an outage this morning. It is back up and running again. If you tried to enter in the giveaway during the outage, you may want to try again sometime. Thanks.