ISBN: 9781119356295, Author: Andrew Hallam
Let’s get this out of the way: Millionaire Teacher is my favourite intro to personal finance book. I first read Andrew Hallam’s Millionaire Teacher a little under two years ago, after which point I gifted two copies to people I thought could benefit from the information. This is the first book I’ve felt compelled to do that for, and also the first book I’ve thought I needed to re-read, with the January 2017 release of the second edition.
For people who want to understand how to better manage their money for the long-term, increasing your chances of a comfortable retirement, this should be your go to book. The writing is clear and low on jargon. It covers a ton of information I wish I’d had coming out of high school.
With that said, I trotted over to my local library and picked up a copy, with the hopes of reading new information on ETF investing and robo-advisors, which were absent in the first edition.
What the Book Covers
- Intelligent spending
- Investment growth over time (the power of compounding)
- The importance of investment fees (why index funds work and why actively managed funds on average underperform market return)
- Controlling for poor investor / investing behaviour
- Asset allocation (the importance of investing in both stocks and bonds)
- Index investing in different countries (including Canada, the U.S. and Great Britain with sample portfolios)
- Alternatives to do-it-yourself investing
- Dealing with investment advisors/brokers (effectively, having a BS detector and knowing which questions to ask)
- Avoiding common mistakes (why buying gold may not be wise, avoiding investment newsletter advice, etc.)
New Personal Takeaways
- Consider a guaranteed pension plan within the context of the fixed portion of your holdings. This implies that you can hold more equity and less fixed assets in your RRSP/TFSA/Taxable accounts. Ah to actually have a pension.
- Do-it-yourself investing, which is my preferred strategy, may not be ideal for everyone. Simplicity is sometimes worth the price premium where people may not want to spend an hour a year managing their portfolio. In those cases, the additional investing cost can be worth it.
- The new segment involving asking banks about putting together an index fund portfolio matched my experience with TD bank directly. It is not a strategy they actively support. They will throw information at you to try and dissuade you from this course, despite research backed findings indicating that it provides a greater probability of success.
If you’re going to read one personal finance book this year, try to make it this one. Personal finance books tend to be dry, though this one tends to avoid that pitfall entirely. This book can help you gain a better understanding of how to get your money working for you. In comparison to other, similarly targeted titles like the Wealthy Barber Returns, I found this title less anecdotal with a far better flow.
- Andrew Hallam was just interviewed on the Canadian Couch Potato podcast. Worth a listen if you’d like to learn more.