I recently read Barbara Friedberg’s 20 Minute Guide to Investing.
This guide is an intro to investing that covers the basics of what you need to know, before you start investing. Barbara covers many topics, including the following:
- What should I do before I invest?
- Why should I invest?
- What is investing, and what are some common ways to invest?
- What are index funds, and how can they help me increase my returns?
- How can I set up my asset allocation to serve me best?
What I loved:
- Barbara tells us that we should take care of our security and feeling of safety first by saving up several months worth of expenses and getting rid of credit card debt before we even start to think about investing. This is a great point, and paying down the credit cards gives you a guaranteed high rate of return.
- Barbara covers the impact of expenses and fees on returns and makes the case for index funds. These fees can make a HUGE difference over time, so instead of subsidizing your personal advisor’s Mercedes, why not keep some of those returns for yourself?
- This is an incredibly dense nugget of information. There is more substance in this free eBook than there is in many costly personal finance books.
What I would have liked to see more of:
- Although Barbara mentioned that the first decade of this century has seen lackluster returns on the part of stocks, I am wondering what the overall return would have been if you had invested over that period of time using dollar cost averaging (DCA). While the jury is against dollar cost averaging in favor of lump sums if you have a lump sum, dollar cost averaging is an important tool for investing income for the long term, especially if one has an employer match on income saved for retirement.
- I would have liked to see some more lifestyle stories. Investing and personal finance are there to serve goals in the end, and these goals might include getting out of the rat race. Stories and fables really help to convey these points across.
- This is an impressive amount of information for a 20 minute guide! While it is very concise and to the point, newbies might be overwhelmed!
Barbara has a passion for investing and personal finance, and it’s not easy to compress that down into twenty minutes! I highly recommend you read her guide and get some free investment advice, and then visit her site, Barbara Friedberg Personal Finance. She is a great writer and blogger, and I enjoy reading her wisdom and advice. I look forward to reading more from her in the future.
I also liked Barb’s ebook. It is very easy to read and makes a lot of great points.
I too am a fan of dollar cost averaging. If I had a lump of money, I would rather put it toward my mortgage then to invest it all at once (unless the market was at all time lows or something. I might be afraid of total collapse then though…Guess I am just not used to have giant lumps of money!)
Barb is a fantastic writer, and truly a wealth of information.
Barb is a gift and is positioning herself to do a whole lot of good! Thanks for the review my friend.
Nice review. I will have to check it out. I love to read anything that has to do with investing.
The 20 minute concept is clever and here’s why. How many large investment books do we all have laying around the house, the closet, attic, etc. where we’ve only read the first 3 chapters? I’ve got boxes! 🙂
Seems like it’s designed to make core points, teach the basics without losing people’s interests. Thus, effective.
HI Kevin, First, thank you so much for reviewing my book, it was a great overview and very balanced. I especially like the “see more of points.” You raised an important issue regarding dollar cost averaging. Yes, there is definitely some debate in the literature about “dollar cost averaging” vs. “going all in at once.” Although I don’t have the figures in front of me, the investor would probably have done much better dollar cost averaging than going “all in” at the beginning of the decade!
Thank you so much for the terrific review!
I got the book too, but didn’t get a chance to read it till today. Your review makes me want to get to it right now 🙂
Well done with the review Kevin,
And very well done with the book Barb. Congrats! You’re doing a great thing for people–and you’re continuing to inspire me.
Cheers,
Andrew
Thanks for stopping by to check the review, everyone. Barb is a great writer and gets right to the point. If her words were in the boxing ring, I’d think she’d knock down Clubber Lang every time… and probably Drago, too.
great review. I’ll have to grab a copy of Barb’s book now.