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Suggested Book to Learn about investing
Old 02-21-2008, 06:27 PM   #1
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Suggested Book to Learn about investing

Hello,
I am so happy to discover this forum. I am enjoying reading the posts and learning so much. I hope to learn a lot more and would like some help. I am 50 years old….have a 401K spread over some mutual funds that I chose with the help of a CS account manager. That’s where it’s been for at least 10 years, just lackluster, going nowhere really. One fund stared with 5 stars….now it’s at 3 stars, when did that happen? I realize now that no one takes care of your money better than you do. So here’s the question…..what books do you suggest reading to learn more about investing and growing your money. I don’t plan to become a day trader in a year or anything like that. I just want to understand investments and money and I am a true beginner.
I will be 53 in 3 years, and I would rather be 53 and smarter with more money for retirement. Any and all suggestions are appreciated. There may be something on an earlier post, but I didn’t see it. Thank you for your help.
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Old 02-21-2008, 06:47 PM   #2
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This link lists some books that are pretty good:

Investment Books

I have read, and would highly recommend, the first four books on the list (Bernstein, Swedroe, Larimore et al., and Ferri). I have read some of the others as well, and they are all worthwhile. You can get most or all of them at amazon.com and also at Barnes and Noble.
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Old 02-21-2008, 07:25 PM   #3
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Excellent response from want2retire.
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Old 02-22-2008, 01:10 PM   #4
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Based on advice here I started with The Four Pillars of Investing, which I felt was a real eye opening experience.

Recently I have read Retire Early Sleep Well by Steven R. Davis. While not strictly about investing I found it very interesting, especially in the area of "slice and dice" asset allocation and retirement modeling.

At the same time I also read Work Less, Live More by Bob Clyatt (who is well known on this forum), which was also a very good book.

In addition to learning about investing, I think it is important to learn about the other important factors such as understanding and managing your consumption and how to properly model retirement planning.

For example, an important fact I had not previously known was that the retirement calculators all to some extent are based on historic returns for various asset classes. The returns they use do not account for the expenses charged by funds. When running the calculations, you need to increase your required annual income by the amount of the charges taken by your mutual funds to compensate for this. Depending on the size of your portfolio this could be several thousand dollars.

Because of this and to account for taxes and for charging a portion of car replacement and house repair on an annual basis I have decided that my original estimate of $40,000 per year needed should be closer to $55K or $60K. This can make quite a difference in the safe RE date.
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Old 02-22-2008, 01:17 PM   #5
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My favorites are all on Want2retire's list as well.

The Four Pillars of Investing is my personal favorite too, my holdings follow Bernstein's approach almost exactly. It's not scary technical, but it could be a little deep for a beginner. But if you're somewhat financially/numbers savvy, it makes a compelling case.

For a real beginner, the Coffeehouse Investor is a good place to start. Scott Burns offers a similar approach, the Couch Potato Portfolio and a few variations from there. I don't think he has a book but it's easy to find online. And if you want to - you can move from these to a little more sophisticated models (like Four Pillars) without turning your holdings upside down to get there.

I also recently read Clyatt's Work Less, Live More and liked it a lot, but it's about more than just the $ aspect of retirement. And finally, it's not about investing, but The Millionaire Next Door had a big related influence on me (and Your Money or Your Life many years earlier). The Bogle books are excellent as well. My 2˘ (now 4˘)...
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Old 02-22-2008, 08:59 PM   #6
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Steps to a Suitable Portfolio

I stumbled upon this which looks interesting. I have yet to read it all.
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Old 02-22-2008, 09:42 PM   #7
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"The Little Book of Common Sense Investing" by John Bogle (2007).
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Old 02-22-2008, 10:06 PM   #8
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"Common Sense on Mutual Funds" by John Bogle
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Old 02-23-2008, 05:58 AM   #9
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The Four Pillars of Investing
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Old 02-23-2008, 06:20 AM   #10
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The Four Pillars of Investing
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Old 02-23-2008, 01:40 PM   #11
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Quote:
Originally Posted by Want2retire View Post
This link lists some books that are pretty good:

Investment Books

I have read, and would highly recommend, the first four books on the list (Bernstein, Swedroe, Larimore et al., and Ferri). I have read some of the others as well, and they are all worthwhile. You can get most or all of them at amazon.com and also at Barnes and Noble.
great link - thank you. i've read several on the list. my fave was Bogles "Common Sense on Mutual Funds". i return to it periodically to make sure i'm still on track.
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Old 02-23-2008, 11:28 PM   #12
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For me "A Random Walk..." was the first "investing" book I read. What an eye opener that was. Should go back and read it again - especially the sections on Bubbles

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Old 02-24-2008, 08:23 AM   #13
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I liked "The Only Investment Guide You'll Ever Need" by Andrew Tobias. It gives a nice overview of what's available out there. It was a nice, easy read, and gave me a good idea of what I might want to invest in, as well as what I probably wouldn't want to mess with. Then, it was easy for me to filter out books and other info that really wasn't pertinent to me and my needs and goals.
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One of My Favorites Is:
Old 02-24-2008, 08:43 AM   #14
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One of My Favorites Is:

The Future for Investors (Why the Tried and True Will Triumph Over the Bold and New) by Jeremy Siegel.

I'm certainly going to consider some of the books listed in the other replies - it looks like there are some good nuggets of information.
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Old 02-24-2008, 08:57 AM   #15
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I liked "The Only Investment Guide You'll Ever Need" by Andrew Tobias. It gives a nice overview of what's available out there. It was a nice, easy read, and gave me a good idea of what I might want to invest in, as well as what I probably wouldn't want to mess with. Then, it was easy for me to filter out books and other info that really wasn't pertinent to me and my needs and goals.
I liked that one too, though at times it seemed a little chatty. Guess that's just a matter of what kind of writing style appeals to an individual! It's definitely worth taking a look at, though. I should also mention that Four Pillars was (for me) awfully, awfully boring but I think that it is a absolutely necessary read. His arguments are so compelling that you just cannot deny what he is saying, and thus it instills good fundamental investment instincts. But don't quit after Four Pillars because some other books are fascinating (I am thinking especially of the Swedroe and Larimore et al books, for me, which I really liked a lot). I would suggest going to B&N to glance through some of these and see which look interesting.

Some other books mentioned on this thread are GREAT, by the way, and I am thinking especially of the Malkiel, Bogle, Burns, and Tobias books. Each adds its own kernel of information and I think eventually most people read several.

At amazon.com, some prices are
The Four Pillars of Investing by William Bernstein: $19.77
The Only Guide to a Winning Investment Strategy You'll Ever Need by Larry Swedroe: $17.13
The Bogleheads' Guide to Investing by Taylor Larimore, Mel Lindauer, and Michael Leboeuf: $11.53
All About Asset Allocation by Richard Ferri: $13.57

So, the first four on that list (my favorites) could be bought for $62.00 and the order should qualify for free shipping. Other books mentioned on this thread could probably be purchased for similar prices.

Happy reading, everyone!
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Old 02-24-2008, 09:12 AM   #16
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All About Asset Allocation by Richard Ferri: $13.57
I haven't seen this one. How would it compare to, say, Bernstein's The Intelligent Asset Allocator?
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Old 02-24-2008, 09:48 AM   #17
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I haven't seen this one. How would it compare to, say, Bernstein's The Intelligent Asset Allocator?

I think Ferri's book is excellent. I wouldn't recommend it for someone's first or only book, because I don't feel it presents everything a new investor needs to know. However, in my opinion it is very well written, very up to date, and delves into some aspects of asset allocation a little more deeply than some. It causes me to really think and go back time and again, perhaps more than some similar books. Bernstein himself wrote the introduction, and among other observations says "All About Asset Allocation will bring you back into the modern era with a comprehensive, yet readable exposition of how to apply to your investment portfolio what seven decades of financial research have taught us about investing."

Ferri covers asset allocation basics, asset class selection, and portfolio management. I would strongly suggest picking up a copy and looking through it yourself, if wandering through B&N. His chapter titles are:

1. Planning for Investment Success
2. Understanding Investment Risk
3. Asset Allocation Explained
4. Multi-Asset-Class Investing
5. A Framework for Investment Selection
6. U.S. Equity Investments
7. International Equity Investments
8. Fixed-Income Investments
9. Real Estate Investments
10. Alternative Investments
11. Realistic Market Expectations
12. Building Your Portfolio
13. How Behavior Affects Asset Allocation Decisions
14. Investment Expenses and Professional Advice
Appendix A: Low-Cost Mutual Fund Providers
Appendix B: Research Web Sites
Appendix C: Recommended Reading
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Old 02-25-2008, 09:30 PM   #18
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Hello everyone,
Thank you so much for the recommended reading. I have ordered a couple of the books to start, from Amazon...(free shipping) and I will be very busy reading.
Thanks again. I really appreciate the help.
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