Andrew Hallam became a debt free millionaire in his 30′s. He’s not a corporate CEO, doctor or lawyer. He works as a high school English teacher – in Singapore, no less – without the comfort of a traditional defined benefit pension plan enjoyed by teachers here in Canada.
Hallam wrote Millionaire Teacher for two reasons. One, as a high school teacher he saw first hand the type of personal finance education students received in school. And two, Hallam was motivated by his friends and colleagues who were getting bad advice from the financial industry on how to invest their money.
Millionaire Teacher: About the Book
In the Millionaire Teacher, Hallam shares his personal experiences with saving and investing in a witty and easy to read style. Throughout the book, Hallam explains the nine rules of wealth you should have learned in school.
Rule #1: Spend like you want to grow rich – To stay out of harm’s way financially we need to build assets, not debts. But too many people hurt their financial health by failing to differentiate between their wants and their needs.
Rule #2: Use the greatest investment ally you have – Starting early is the greatest gift you can give yourself. If you start early and invest efficiently, you can build a fortune over time.
Rule #3: Small percentages pack big punches – Instead of recommending actively managed mutual funds, advisors should be directing their clients toward index funds. With just three index funds you’ll beat the pants off of most financial professionals.
Rule #4: Conquer the enemy in the mirror – Whether it’s an index fund or an actively managed mutual fund, most investors perform worse than the funds they own because they like to buy high, and they hate buying low. That’s a pity.
Rule #5: Build mountains of money with a responsible portfolio – Ensuring that your account has a bond index, a domestic stock index, and an international stock index provides you with a greater statistical chance of investment success.
Rule #6: Sample a “round-the-world” ticket to indexing – A detailed look at indexing in the United States, Canada, Singapore and Australia. Regardless of where you live, if you build a diversified account of index funds, you’ll beat 90% of professional investors. In a taxable account, you’ll do even better.
Rule #7: Peek inside a pilferer’s playbook – Many financial advisors have mental playbooks designed to deter would-be index investors and they initiate their strategies with remarkable success. If you’re prepared for what they might say, you’ll have a better chance of standing your ground.
Rule #8: Avoid seduction – It’s important to control the seductive temptation of seemingly easy money. There’s a world of hurt out there and rascals keen to separate you from your hard-earned savings.
Rule #9: The 10% stock picking solution…if you really can’t help yourself – When buying individual stocks, do it intelligently. You’re not likely to beat the indexes over the long term, but you’re sure to have the odd lucky streak, and you might really enjoy the process.
Final Thoughts on Millionaire Teacher
Andrew Hallam knocked one out of the park with the Millionaire Teacher. He does an outstanding job breaking down complex topics into simple terms, often using personal stories and anecdotes to really drive the point home.
Hallam blasts the financial industry over their excessive mutual fund fees and deceptive marketing tactics, and he encourages investors to take control of their own finances. There’s an overwhelming number of mutual funds and ETFs to choose from, and countless “perfect portfolios” that experts have designed for the do-it-yourself investor.
Hallam’s simple solution is to buy a domestic index, an international index, and a bond index – and rebalance annually to your age-related allocation breakdown.
Million Teacher is an outstanding personal finance book and deserves to be on your bookshelf next to The Wealthy Barber Returns and Findependence Day. It should be required reading for high school and University students.
Andrew was kind enough to send us a second copy of Millionaire Teacher to give away to one lucky Boomer & Echo reader. If you’re interested in winning a free copy of this book, leave a comment below telling us what money lesson you wish you learned in school. We’ll announce the winner of the book on Friday March 16th.