Recommended Financial Literacy Level: [Beginner]
Perfect for beginners
Also great for seasoned investors
I’m a big fan of Jim Collins. I listened to his talk at Google, scoured and became a follower of his blog at jlcollinsnh.com, and listened to any podcasts where he is the guest. Jim has admittedly tried to beat the market in his younger years and has found that simple is best. The Simple Path to Wealth is about putting you in control of your financial destiny. His ideas and recommendations are simple yet extremely beneficial. Jim’s message is refreshing as he tells it like it is and lays out a step-by-step process for anyone to retire a millionaire.
Chapter 1 was all about debt and it was one of my favorite parts of his book. It seems that debt has become a normal and acceptable part of society. Jim is very firm about debt, saying “debt is the biggest obstacle in building financial independence.” When I look at my neighbors they are constantly purchasing new vehicles, boats, ATV’s and upgrading houses, TV’s, smartphones and more. Those who see debt as a ticket into the good life will most likely never achieve financial independence due to their acceptance of debt. The book continues to discuss every part of Jim’s financial life as he educates his daughter.
- Part 1: Orientation
- Chapter 1 – Debt: The Unacceptable Burden
- Chapter 2 – Why you need F-You Money
- Chapter 3 – Can everyone really retire a millionaire?
- Chapter 4 – How to think about money
- Chapter 5 – Investing in a raging bull (or bear) market
- Part 2: How to harness the world’s most powerful wealth-building tool
- Chapter 6 – There’s a major crash coming!!! and even famous economists can’t save you
- Chapter 7 – The market always goes up
- Chapter 8 – Why most people lose money in the market
- Chapter 9 – The Big Ugly Event
- Chapter 10 – Keeping it simple: consideration and tools
- Chapter 11 – Index funds are really just for lazy people, right?
- Chapter 12 – Bonds
- Chapter 13 – Portfolio ideas to build and keep your wealth
- Chapter 14 – Selecting your asset allocation
- Chapter 15 – International funds
- Chapter 16 – TRFs: The simplest path to wealth of all
- Chapter 17 – What if you can’t buy VTSAX? Or even Vanguard?
- Chapter 18 – What is it about Vanguard anyway?
- Chapter 19 – The 401(k), 403(b), TSP, IRA and Roth buckets
- Chapter 20 – RMDs: The ugly surprise at the end of the tax-deferred rainbow
- Chapter 21 – HSAs: More than just a way to pay for medical bills
- Chapter 22 – Case Study: Putting The Simple Path to Wealth in action
- Chapter 23 – Why I don’t like investment advisors
- Part 3: Magic Beans
- Chapter 24 – Jack Bogle and the bashing of index funds
- Chapter 25 – Why I can’t pick winning stocks and you can’t either
- Chapter 26 – Why I don’t like dollar cost averaging
- Chapter 27 – How to be a stock market guru and get on CNBC
- Chapter 28 – You, too, can be conned
- Part 4: What to do when you get there
- Chapter 29 – Withdrawal rates: How much can I spend anyway?
- Chapter 30 – How do I pull my 4%?
- Chapter 31 – Social Security: How secure and when to take it
- Chapter 32 – How to give like a billionaire
- Chapter 33 – My path for my kid: The first 10 years
- Chapter 34 – Tales from the South Pacific
- Chapter 35 – Some final thoughts on risk
JJ’s Biggest Takeaways:
- This is easily one of the best financial books I’ve ever read. This book should be read by everyone regardless of your level of financial knowledge. I highly recommend purchasing a copy of this book for yourself and it also makes a great gift for others. People need to understand that debt is not normal and should not be accepted as a part of life. If you want to become wealthy, you need to understand that debt holds you back from wealth-building opportunities.
- Jim’s overall message is simple and straightforward:
- Eliminate debt
- Spend less than you earn
- Invest in low-cost index funds
- Continuously add money to you wealth-building machine (keep emotions out of it)
- Reap the rewards of your work through compound interest
- Buy this book for you and others. Jim’s message is critically important to your financial future. That’s exactly what I have done along with following the tools and strategies shared by Jim within his book and blog.
Have you read The Simple Path to Wealth? What are your thoughts, likes/dislikes, and biggest takeaways?