Mr. J.C. – some might call him and the Lord and Savior of the investing world… No, not really. But J.L. Collins did write a fantastic book that has been taking the investing community by storm. Mr. Collins took the success from his online blog, which centered on a well-known and well-referenced stock series, and turned it into a decently written, well-informed book on the practices of investing. The book was reviewed by many of the well-known financial bloggers, including the famous Mr. Money Mustache, who provided a forward on the book. Most of these reviews were positive, pushing the need for any investor, novice to experienced, to read this book. Well, they were probably given a free copy of the book and were already connected with Mr. Collins. Our review on his book will be from the point of well, yes, of a free copy (only because we checked it out from the library), and with no personal connection to Mr. Collins.
So should YOU read The Simple Path to Wealth by J.L. Collins? Absolutely.
Financial advisors stress the complexity of investing. The media inform us that the world is about to collapse. Your friends, family, and coworkers all have individual takes and perspectives on spending/saving/investing. With so much input, decision paralysis can easily take hold when we should be taking action to secure our future, AKA saving a large percentage of our income and investing the rest. If you don’t take care of your own future, NOBODY ELSE WILL.
That is what this book accomplishes. It directly gives you the answers on how to secure your future by making investments in the stock market, bond market, etc. Not only does it give you the answers to the most important questions, but it puts in perspective with analogies, examples, and real life stories. The point of the book is to make you comfortable enough to make the decisions on your own and with pure confidence. In doing so, you are given the simple guideline to avoid expensive financial advisors (do you really know how much they cost and are they really smarter than the market?), make decisions on how much you split between stocks, bonds, cash (your asset allocation), and how to do such things as you move through your different life stages.
Basically, it will give you the answers to solve a majority of your financial needs. Not all. But enough that if you follow his basic guidelines, will provide you with a very safe and secure financial future.
Drawbacks. The book is repetitive. VERY repetitive at times. However, this was to ensure the main principles were driven home. This is probably good for a novice investor to read, but if you are well read on the subject, you too will likely concur with the repetition. (We read A LOT on this topic, so we tend to sense the repetition in most books of this type)
I would have also liked to have seen some additional information around some a bit more advanced topics such as tax loss harvesting. He did discuss types of accounts and where your assets should be placed for maximum tax efficiency, but the next step would be how to effectively tax loss harvest, which can provide additional tax benefits. Also, how to plan against catastrophic health issues, perhaps the need to move into a nursing home for a long period of time? It seems this is an often glanced over issue that advisers and specifically the early-retirement community overlooks. But this is definitely a concern.
Nonetheless, read the book, especially if you can get it for free. If not, spend time and read over his stock series at: Stock Series.