The Simple Path to Wealth

Your Road Map to Financial Independence and a Rich, Free Life

By: JL Collins

Narrated by: JL Collins, Peter Adeney

This book grew out of a series of letters to my daughter concerning various things - mostly about money and investing - she was not yet quite ready to hear.

Since money is the single most powerful tool we have for navigating this complex world we've created, understanding it is critical.

"But Dad," she once said, "I know money is important. I just don't want to spend my life thinking about it." This was eye-opening. I love this stuff. But most people have better things to do with their precious time. Bridges to build, diseases to cure, treaties to negotiate, mountains to climb, technologies to create, children to teach, businesses to run.

Unfortunately, benign neglect of things financial leaves you open to the charlatans of the financial world. The people who make investing endlessly complex, because if it can be made complex it becomes more profitable for them, more expensive for us, and we are forced into their waiting arms.

Here's an important truth: Complex investments exist only to profit those who create and sell them. Not only are they more costly to the investor, they are less effective.

The simple approach I created for her and present now to you is not only easy to understand and implement, it is more powerful than any other.

Together we'll explore:

• Debt: why you must avoid it and what to do if you have it
• The importance of having f-you money
• How to think about money, and the unique way understanding this is key to building your wealth
• Where traditional investing advice goes wrong and what actually works
• What the stock market really is and how it really works
• Why the stock market always goes up and why most people still lose money investing in it
• How to invest in a raging bull or bear market
• Specific investments to implement these strategies
• The Wealth Building and Wealth Preservation phases of your investing life and why they are not always tied to your age
• How your asset allocation is tied to those phases and how to choose it
• How to simplify the sometimes confusing world of 401(k), 403(b), TSP, IRA, and Roth accounts
• TRFs (target retirement funds), HSAs (health savings accounts), and RMDs (required minimum distributions)
• What investment firm to use and why the one I recommend is so far superior to the competition
• Why you should be very cautious when engaging an investment advisor and whether you need to at all
• Why and how you can be conned, and how to avoid becoming prey
• Why I don't recommend dollar cost averaging
• What financial independence looks like and how to have your money support you
• What the Four Percent Rule is and how to use it to safely spend your wealth
• The truth behind Social Security
• A case study on how this all can be implemented in real life

Download the accompanying reference guide.©2016 JL Collins (P)2017 Audible, Inc.

Critic reviews

"In the dark, bewildering, trap-infested jungle of misinformation and opaque riddles that is the world of investment, JL Collins is the fatherly wizard on the side of the path, offering a simple map, warm words of encouragement and the tools to forge your way through with confidence. You'll never find a wiser advisor with a bigger heart." (Malachi Rempen, filmmaker, cartoonist, author, and self-described ruffian)

Buy and Hold VTSAX

Book about how to invest simply, but does not touch much on the other aspects of personal finance. Collins loves Vanguard, specifically VTSAX, which has a low expense ratio and tracks the market well. His logic is that capitalism works, so investing in this basket of roughly 1,500 stocks will manage itself.
Key takeaways: Don’t worry about timing the market, spend a lot less than you make if you want to retire early, pay off debt that is more than 5% interest, don’t spend too much on a house, and take advantage of tax-incentive retirement plans.
Collins makes the claim that almost all personal finance workers (ie. Investment Advisors and Broker Dealers) are crooks and if you must work with someone in the profession, work with a fee-only advisor to save your money. Given that each person’s situation can be uniquely different, do not care for this argument much because most people cannot stomach strong down turns without someone talking them off the cliff of selling. If you can stick to the buy-and-hold strategy on your own, this book is for you.

Overall pretty good, with a few shortfalls

This is a great beginners guide to learning about, managing and investing money. It provides a good high level strategic view, and also gives tactical and operational advice, especially about the types of index funds to hold in tax advantaged versus taxable buckets. However it is very heavily focused solely on Vanguard when not everyone will have access to, or want to use that firm. It is fine if the author wants to use Vanguard, but he should provide more details on comparable index funds at other firms since most discount brokers pretty much have them now-a-days. Also, he doesn't give ETFs fair consideration. Case in point: Vanguard has ETFs (VTI) with fees comparable to its equivalent Admiral shares (and no minimum investment unlike Admiral shares). Why isn't this discussed?

I like that the subject of charitable giving was treated towards the end of the book, although again I am puzzled by why he is pushing Vanguard Charitable. This account has a $25,000 minimum while Schwab and Fidelity have a $5,000 minimum each, both of which can also invest in comparable passive index funds/ETFs. Yet again this is not mentioned.

Personally I don't care for the author's use of the term "FU money". I'm sure there is a better way to make this point without bordering on classless vulgarity.

Outstanding

This is an absolutely outstanding book. My only regret is that I wasn’t able to read it sooner. The author gives great advice that will serve you well at all stages of your financial life. Highly recommend it.

Good Stuff.

VTSAX. VTSAX VTSAX. That's the way to go towards financial freedom. One of my favorite authors.

A Must Read

Must read for every person.. doesn't matter what stage of financial step they are... so much to learn. I will make sure my kids read and understand this book before their 20th b'day..

Get on the Path! Stay on the Path!

My wife and I are both CPA's and we believe this book is all you really all you need to know to become financially wealthy. You won't be sorry you got this book. It gives us the motivation to become FI. His stories are interesting and his voice is great to listen to. Even as CPA's we both learned a lot about the investing world. We will be giving away copies to friends and family who haven't gotten on the path yet. Thanks, JL!

good

been through it 3 times. listen to it at 1.5 speed. thank me later. kbye

So simple that makes you follow through

When I first started investing, not sure what stock to buy. Just listen to my friend's advise buying individual stock, which didn't work out well. This book helps to to focus on index fund. The advise is so simple to follow and it works. Investing doesn't need to be complicate. The simple advise works the best.

Amazingly Simple

Fantastic read with a simple technique. Although he makes his love for Vanguard quite clear, if that’s what he found works, then so be it! I’ll love it too!

Must read book

Best financial book I’ve read. Love how he explained things. Very easy to follow and understand. I’m so inspired to start. I’m very behind in age starting and have 2 very young kids. I missed a lot of opportunities and made mistakes for sure but it’s never too late. Simple Path is my kind of path. Thank you JL Collins!