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Review of The Simple Path to Wealth

How can a letter to his 19-year-old daughter inspire a father to start a personal finance blog and then turn the best stuff from the blog into a book? It must have been one heck of letter!?!

The Simple Path to Wealth by J L Collins is simply “Your roadmap to financial independence and a rich, free life”. As I mentioned, Collins initially intended to write a series of letters to his daughter sharing many of life’s lessons he has experienced including personal finance and investing advice. This led him to start writing articles on his blog. Collins consolidated the best of his articles as well as readers’ comments and questions into his book, The Simple Path to Wealth.

The purpose of this book is personal finance education through stories and entertainment. I believe anyone will be able to grasp the ideas and principles laid out in the book because of how relatable the concepts are through stories and case study examples. This book will be enjoyable and informational for everyone from a novice hoping to learn what the stock market is to the experienced investor wanting to compare asset allocations.

Prior to reading this book, I spent countless hours on Collins’ blog reading his Stock Series and other articles as well as the insightful comments from readers and his replies back to them. It was a lot of information to take in and process so I will admit I was not only excited, but even a little relieved when I heard Collins was writing a book to collect the best ideas and conversations from his blog.

As I was reading the book, I thought to myself that it felt like I was just eavesdropping on a conversation of friends with some personal finance lessons mixed in on along the way. It doesn’t hurt that he adds a fair amount of humor and wit. He even uses beer as an analogy in the book! This would be a great book for so many audiences. A teenager wanting to learn more about personal finance, a retiree wanting to learn more about social security and retirement account withdrawal rates, a group of friends sharing investing ideas at a book club, or even just someone searching for a good read.

So Who is This Guy?

I feel I better understand and relate to people as I learn more about them and understand what they value. While I have shared a few email conversations with J L Collins, I wouldn’t say that I know him personally. But I do feel like I have a pretty good idea what he values based on his blog and his new book. Actually it’s much simpler than that because most of it is right here on his “About” page.

J L Collins is not your typical personal finance author. He has seemingly done a bit of everything. On his blog, www.jlcollinsnh.com, Collins shares some of his earlier jobs from when he was a kid selling fly swatters, pumping gas, and being a mail clerk to more recently being a radio talk show host, an investment officer, and an ad agency founder. With this book recently being published, Collins can now add being a published author to his already impressive job history and work experience.

The Road Map to Wealth

The book is broken up into four major parts. The first part sets the stage for the importance of money and savings. This section explains the unacceptable burden debt has on our lives, discusses “F-You” money and financial independence, as well as some parameters on how to think about money before wrapping up the section with a teaser on investing in the stock market. The second part is all about the stock market – why most people lose money in the stock market, index funds, asset allocation, retirement accounts, and even suggests specific funds. The third part is appropriately titled “Magic Beans” as he debunks many misnomers and myths about investing. The fourth part of the book discusses in detail what to do when you do “get there” and reach financial independence or are ready to retire. He even has a whole section on Social Security discussing how secure it is and will be in the future as well as clear logical instruction on the best time to start taking social security.

The book is written in simple language that is easy to read and understand. But at times there are some technical terms discussed such a discussing 401(k)’s, 403(b)’s, RMD’s (required minimum distributions). But each of these seemingly technical terms are inherently part of the financial industry and we should all start to become familiar with them as we better understand our own financial situations through the different stages of our lives. If you are fairly new to saving and investing money, don’t try to rush through the book or skip ahead sections as I feel some readers might get lost and find themselves having to go back and re-read sections.

The Investing Secret

The Simple Path to Wealth isn’t a mystery thriller novel where you can just skip to the end and find out all the answers. Each chapter provides new insights and actionable items. The more I read and learn about personal finance I realize, there is no “smoking gun”. There is no magic answer, or best stock, or a secret type of account. The founder and retired CEO of The Vanguard Group, Jack Bogle, has said on the topic of investing and wealth building, “The secret is there are no secrets”.

In today’s’ world it is becoming increasingly difficult for any idea on money and investing to be new and unique. I am not implying that this book is merely a rehash of other investing books, but rather Collins actually offers a fresh perspective on making personal finance straightforward and easier by explaining ideas and even going as far as recommending specific funds to invest in and the types of accounts to hold those investments in. I suggest taking your time to read this book rather than trying to get through it all in just a couple of sittings. If you do find yourself wanting to rush through this book, then plan going back and re-reading a bit to make sure you understand the topics.

Takeaways

Overall, The Simple Path to Wealth was insightful for me as I had several “aha moments” while reading it. Collins’s blog and book have brought changes in my behavior and investing approach. Just as the title of the book implies – I realized we have many areas of opportunity to simplify our overall investing approach right down to consolidating the number of stocks and mutual finds we are invested in.

The Simple Path to Wealth can truly be your standalone resource for saving and investing. I will continue to encourage others to read the book as I am confident readers will be surprised how simple the path to wealth can truly be.

This book can be found on Amazon here and is also available in the Kindle edition.

 

For full transparency and disclosure, Mr. J L Collins reached out to me with the proposition that he would provide me with an advanced copy of the manuscript of this book if I would be willing to write a blog post reviewing the book. I was honored and graciously agreed.

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