I always say that everyone makes financial mistakes and so you shouldn’t feel bad about yours. I’ve certainly made mine. My biggest mistakes all involved investing, and I’m certain that’s only because I hadn’t yet figured out JL Collins’ approach.
To be fair to myself, JL hadn’t started blogging at that point. I did some reading on my own, but I was just too scared to take the plunge. I was worried because I didn’t understand how investing worked. Those fears were understandable, but they cost me. A lot. Don’t let them cost you.
Anyone can do it
Gone are the days when you needed huge gobs of money in order to invest. You don’t need a broker or an advisor. You really don’t need much at all. With just a few dollars and access to the internet you can buy your first shares of stock. But how do you do it? Where do you begin? What do you buy?
A while back I started asking folks why I couldn’t just invest in the S&P 500 in order to get a broad range of stocks in my portfolio. The S&P 500 is, after all, a collection of the 500 largest companies in the stock market. No one could give me a good answer one way or the other. I figured that idea was too simple so I did other things instead. Big mistake. I should have gone with my instincts.
Then I came across JL’s blog and it Blew. My. Mind. Suddenly it all made sense! That’s why I recommend it to all my clients and link to it on the Nest Egg Recommendations page (which has affiliate links, as does this page, so you pay the same price you always would, but I might get a small commission if you purchase.) Suddenly I not only understood that my instincts were right, but why and how.
You see, JL doesn’t just offer good advice and insights. I mean, that’s useful too. Obviously. But it’s more than that. He breaks down these complicated, obscure, opaque terms and processes in a way that actually makes sense! Suddenly regular people like you and me can understand it!
Then he did something even more incredible. He started writing his Stock Series on the blog! I was totally hooked. I read every single post, and many of them twice or more. I couldn’t get enough.
So you can imagine how excited I was when he wrote a book. I couldn’t wait to get my hands on it.
My take on The Simple Path to Wealth
Lucky for me, I didn’t have to wait as long as I would have expected. JL actually offered me an advanced copy so I could review it! I was honored, not to mention intrigued. I read every word. I didn’t have to; most reviewers don’t. But I knew I’d want to read every word eventually anyway, and I don’t recommend anything that I haven’t thoroughly checked out. As it turns out, to my surprise, I actually learned some new things!
That means that even if you read the entire stock series, you could still learn some new things from this book, too!
So you’re probably wondering what I thought. Overall, I think The Simple Path to Wealth is a fantastic resource full of useful, well thought-out, simply broken down information. It has its faults, as all books do, but I definitely recommend it. I think it’s a great book for anyone to read so they can learn more about the often-intimidating world of investing in a way that isn’t intimidating at all.
I’ll admit there are some things I didn’t love about this book. Everyone has styles they prefer, and that’s really subjective. Personally, I wasn’t crazy about the writing style. That’s me. Maybe it’s perfect for you. But while it wasn’t my preferred style, it wasn’t hard to read, and I think that’s the most important thing.
I also wasn’t completely thrilled with the organization. I felt the book got ahead of itself at times. I would have liked to see certain concepts defined and explained a bit earlier in the book.
But then, it has fantastic examples. Every concept is clearly explained. Do this, get that result. Do this other thing, get this other result. See how they compare. It makes dividends, index funds, and the rest so much easier to understand.
It’s also a quick read. Granted, I already knew a lot about investing. Still, I’m a very slow reader. And I had a bad habit of stopping throughout the book to pull up my own portfolio and compare it to what was being discussed. Or to click a link to a calculator and play around, only to realize that 20 minutes had passed and I was totally distracted. (But it was fun!) So for me to find it a quick and easy read is actually a really good sign. It’s not too long or too dense.
Sure, I would have liked to see a more thorough explanation of certain things (What’s the Dow? What’s the Nasdaq? What are some more examples of compound interest?) but you can get by without those. More importantly, JL explains what the market actually is and how it works. He covers investing in bull markets (when prices are going up) and bear markets (when prices are going down.)
Mostly, I love JL’s overall wisdom about the market. Like when he lists all of the market downturns in his 40 years of investing and points out, “The market always recovers. Always. And, if someday it really doesn’t, no investment will be safe and none of this financial stuff will matter anyway.” He has a point.
He thoroughly explains why his approach is the best. You still might not agree, but it’s pretty convincing. Of course, I was convinced before I started reading. But I bet you’ll see what I mean. It’s a pretty darn good argument.
Then he talks about different retirement accounts and their associated tax advantages. This is complicated stuff and once again, JL breaks it down in a way you can understand. Of course, these are specific to the U.S., but you can probably work out equivalents in your own country. He tells you how to prioritize the different kinds of accounts you might have access to and what to do with any excess money.
Finally, JL lays out his plan for his daughter, which is what started this all. He offered this plan on his blog so that his daughter would know what to do with her money, and readers loved it (including me!) The Stock Series followed from there. I sure wish I’d been lucky enough to get this kind of advice when I was his daughter’s age! But hey, better late than never. I still have time to benefit from it, and I’m guessing you do, too.
What about you?
So what will you do with the information you glean? Will you implement it right away? You should! Don’t delay! Delays cost money!
Read the book for yourself and make a few simple changes for your own benefit. Start small, and build from there.
And if you’re not read to read the book yet, please read the first few posts of the Stock Series on JL’s site. You won’t regret it.
Ask an investing question in the comments below, and I’ll do my best to answer it, or to tell you if The Simple Path to Wealth answers it!
How to start on your investing journey
If you’re like most people, you’re probably excited to try out this hip new investing craze, but you just don’t have the money to get started. Never fear! Check out this free 1-page cheat sheet on how to save $100 and do it this week because there’s no better time to start than right now! Before you know it, you’ll have built up the F-You Money that JL talks about on his site and in the book!