Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School
Posted by jack_miller | Published a year ago
With 712 ratings
By: Andrew Hallam, Peter Drew, et al.
Purchased At: $22.95
The incredible story of how a schoolteacher built a million-dollar portfolio, and how you can too....
Most people wouldn't expect a schoolteacher to amass a million-dollar investment account. But Andrew Hallam did so, long before the typical retirement age. And now, with Millionaire Teacher, he wants to show you how to follow in his footsteps. With lively humor and the simple clarity you'd expect from a gifted educator, Hallam demonstrates how average people can build wealth in the stock market by shunning the investment products peddled by most financial advisors and avoiding the get-rich-quicker products concocted by an ever widening, self-serving industry.
Using low-cost index funds, coupled with a philosophy in line with the one that made Warren Buffett a multi-billionaire, Hallam guides readers to understand how the stock and bond markets really work, arming you with a psychological advantage for when markets fall.
- Shows why young investors should hope for stock market crashes if they want to get rich.
- Explains how you can spend just 60 minutes a year on your investments, never open a financial paper, avoid investment news, and still leave most professional investors in the dust.
- Promotes a unique new investment methodology that combines low cost index funds and a Warren Buffett-esque investment philosophy.
Millionaire Teacher explains how any middle-income individual can learn can learn the ABCs of personal finance and become a multi-millionaire, from a schoolteacher who has been there and done that.
PLEASE NOTE: When you purchase this title, the accompanying reference material will be available in your My Library section along with the audio.
1. Millionaire Teacher - Andrew Hallam is an easy to read & understand guide to achieving your financial goals. His 9 rules explain what to invest in, how to deal with banks & financial advisors, how to balance your portfolio & a lot more, while spending only a few hours per year reviewing & correcting.
2. Barefoot Investor - Scott Pape, explains how to structure your finances & discipline yourself to control your spending with ease, how to deal with debt, save for holidays, invest in your future by saving for a home, & investing in you superannuation. It written based on living in Australia but the principles can be applied to living anywhere.
These 2 books complement each other very well, & I highly recommend you read both.
That said, I will take exception with his suggestion to put what I consider lots of your money into bond funds. Since interest rates peaked in 1981 when money market funds were paying about 14%, owning bond funds has been a good thing. But with interest rates near zero, we may be looking at a 20 or 30-year bear market for bonds. The great Peter Lynch the author quotes to support his suggestion to put money into index funds also said put all your money into stocks and none into bonds. Warren Buffett is also quoted, but the fact that he recommends individual investors put all their money into stock index funds with none in bond funds is also ignored. Lynch did say to sell all stocks and go 100% into 30-year US Bonds if the yield on them hits 9%, but we are a long way from that.
Ignoring half of what these two great investors said is why I give 4 stars instead of 5. I can't tell you that you are wrong to put half of your money into bond funds, but two really great investors do.
Investing shouldn't be difficult. It shouldn't be mystical. And this book proves it. I've gone 40+ years not having much of a clue about investing. That fact alone has cost me literally hundreds of thousands of dollars for my 70+ year old self. But this book will help my 70-year-old me breathe a little easier financially, and for that I'm grateful.
It's not the Bible. But it is now only the second book in my lifetime that I recommend everyone should read (and that's saying a lot, seeing as I have one of my own out there).
First: I encourage you to ignore negative reviews that paint the book at “repetitive.” The author intended this book to be an introduction to the subject, it is not designed for those that have read Bernstein or Malkiel.
Secondly; The 1 star ratings argue this is “an informercial for Vanguard.” This assertion is absurd. Successful investment comes from owning low cost funds- currently vanguard offers the CHEAPEST funds. Hallam would suggest any company that has the lowest cost. If tomorrow it were Fidelity, he would release and updated version talking about their funds.
Once you have read Hallam, look for Bogle, Finley, Armstrong, Ellis, Bernstein, and Malkiel.
Just do exactly what this book says (like buy Vanguard funds and avoid trend stocks). I lost $10K chasing newsworthy Rx stocks and Tech companies. It's all newspaper rhetoric. I analyzed swing-trading charts like I was plotting a trip to the moon: you can't predict or plan anything!
The only thing that helped me make some serious cash with stocks is the CAN SLIM Method (O'Neil) and this book. For teachers and any other professional making less than $60K a year, this is THE way. Time will pass and you'll lock in "slowly but surely" gains. It's the marathon way of investing, not a get-rich-quick sprint.
After you execute this book's simple financial plan, just focus on how to learn they kids goodlier and give them knowledges. Nothing left to say.
The summary is:
* Spend only what you need to, in order to have a reasonable life style. Save as much as possible to invest for the future. Eliminate debt before you make new investments.
* Start investing as early as possible, to enjoy the benefit of compound interest.
* Invest in low-cost index funds.
* Split your investments into two segments: bond indexes and stock indexes. Weight the bonds according to your age, so if your are 38 years old, hold 35-40% of your entire portfolio in bonds.
* Over time the bond component will grow/fall at a different rate than the stock component. So when you invest new money, buy more of the under-performing component. For example, if stocks have done really well so your portfolio is now weighted 30% bonds and 70% stocks, buy bonds with the new money. Then every year, rebalance the portfolio, selling enough of the higher performing component to buy more of the worse performing component. Note that most people would do the opposite, and buy more of high performing component.
This strategy forces you to sell high but buy low. That's exactly what you'd do when buying and selling any other product.
I can't recommend this book highly enough. If I could, I'd give it ten stars. Buy it, read it, digest it, follow its advice. Ignore almost everything else.
No, I'm not related to the author, I'm totally independent of him.
I have bought 2 copies of this as gifts for others and cannot recommend it enough, it is the single greatest investment I have ever made.
I have read the 'Intelligent Investor' and a few other highly recognised investment books but for me this book gives me confidence that I can now trust my investment decisions.
However, I think every parent should purchase this book for their child. It is one of the best presents you could ever give them.
However, it almost sounds too good to be true - too simplistic. Perhaps it is, and that, I believe, is the truth embedded within the pages.
I will be sure to check in again once I've put into practice some of the amazing advice.
Till then, good luck to all those budding investors!