Book Review: Millionaire Teacher

Recently I’ve been binging on all sorts of personal finance related podcasts and reading.  After listening to a podcast episode of Afford Anything that contained an interview with Andrew Hallam, I was very motivated to read his book.  This book is titled, Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School.  It’s short, it’s reader-friendly, and it’s awesome!  I especially enjoyed it because it focuses on teachers reaching financial independence.  If you’re interested in someone explaining the basics of investing and how to get on the road to financial independence in a simple way, then this is your book!

Here are some of the specific things I took away from my reading:

  1. Even though some people look rich, they aren’t. – In this day in age everyone feels compelled to have the newest and the best of everything.  We are constantly looking around at what other people have and then looking back at ourselves to see if we measure up.  If I look at the woman walking by me on the street and I see that she has a fancy purse, her nails are done, and she’s getting into her new Mercedes, I might be led to believe that she has more money than I do.  However, if she has financed her car, charged the purse, and her appointment at the nail salon, and has to pay it all off in installments over the next decade, is she really rich?  There is a big difference between being rich and projecting an image of wealth.  This is why it’s so important to stop comparing yourself to other people.
  2. Reducing your monthly expenses is a huge part of the battle on the road to wealth. – Too many people want to magically achieve financial independence without making any sacrifices.  The truth is, unless you manage to hit the lottery, this is just a fantasy.  It’s just as important to reduce your necessary monthly expenses and live well below your means as it is to increase your income and your savings.  The less you require to live on each month, the less you will have to save overall to reach financial independence.
  3. It’s important to educate yourself about money so that you can manage your own money. – I meet people every day that have money invested, but they don’t know how it’s invested, what kinds of fees they pay on these investments, what their financial end goals are, or how much money they may need at retirement.  Not educating yourself about your finances is just plain dangerous.  If you don’t know how your money is being invested, you risk losing out on huge amounts of money down the line.  This could mean that you retire years later than you could have, YEARS!  I know I would rather spend years doing things I enjoy more than working.
  4. Index Funds are your friend. – It’s not worth trying to beat the market.  This is an exercise in futility and in most cases is about as effective as chewing bubble gum to solve a math equation.  Many people have gone down the FI road before me and I am in the privileged position to learn from their mistakes.  I don’t know about you, but I’m going to take this information and run with it!
  5. Don’t let financial advisors talk you into doing things that are against your best interest. – In most cases, your financial advisor is making decisions based on what will most benefit their own salary.  Can I blame them?  No!  Most of these people are really salespeople.  They are selling you a product.  If you educate yourself about your options before you meet with any advisor and you decide what you want to do with your money beforehand, you will be less likely to fall prey to the whims of your financial advisor.  Hallam does a great job discussing what kinds of things these advisors will say and what you should do to counter their advice.
  6. Keep your money with Vanguard. – Over the past year or so, Vanguard is all I’ve heard about in terms of where to put your money, and after doing my research I can understand why.  Don’t let people charge you unnecessary fees!

The more frugal I become and the more I learn about my own finances, the more angry I become that I spent so many years in the dark.  I have certainly wasted money unknowingly that could have propelled me further forward today.  Although we could all look back on the past and think about what we could have done better, each day is a new day to begin again.  If you have not already, spend some time researching your financial options.  Track your expenses meticulously for several months.  Finally, grab a copy of Andrew Hallam’s book, Millionaire Teacher, it will enlighten you regardless of your profession!

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