First thing is first, this book was originally published back in 2014 – I am definitely not the first to read it! I am a little like the guy who rocks up to the party at 4am…. 😀
So why read it now?
Well I have made a commitment to myself to increase my Financial Literacy / Financial IQ, by taking in multiple opinions and approaches to gain Financial Independence. This was just one of the books I had lined up in my Kindle ready for the task ahead… You can find my current reading list here!
This was a book that came up a few times in various conversations, and I kept hearing about Ray Dalio’s ‘All Weather Portfolio‘, especially after reading Ray Dalio’s book ‘Principles’. So my interest was piqued…
First up – it is a a big book! And took me quite a while to get through it, as I not a full-time / power reader. Mainly I just chip away at books, when I feel like it…
Secondly – being U.S. focussed, I feel there are some good lessons covered in the book but you have to find/translate some of the terminology/options for your market/region (a slightly obvious example might be 401K/Roth IRA -> Super here in Australia).
There are valuable lessons and talking points in this book. While the book itself has divided opinion, with some of the points outlined are very much valid.
Overall though, I do think applying even some of the basic lessons covered in the book will help a lot of people. And there is probably
What does it cover?
It does cover quiet a fair bit over its 600+ pages… But don’t let that put you off.
The first section of the book, is aimed in a very ‘Tony Robbins’ way. To try and get you to focus on taking ownership for choices and take action.
Next up, some financial ‘myths’ are debunked. This section is very much aimed at trying to prime you to become a ‘financial insider’. Which was a but much for me… But at the same time, by increasing knowledge of some of the ways fees/etc can eat into your savings – maybe it isn’t a bad thing to be a little bit more of an ‘insider’.
The third section, then is where the planning and thinking ahead starts. It is all about making it personable and actionable for you as an individual. This planning comes down to a number of key steps: Define your plan, Save and Invest, Earn More and Invest, Reduce Fees/Taxes and Get Better Returns on Investment.
Now we come to the guts of the book, which dives into different types of asset classes and covers one possible way to seperate out your investments (into a Security bucket and Risk/Growth buckets depending on asset). This section I liked the most – as it was technical, but digestible for the most part.
Finally we then dive into the likes of Ray Dalio (including All Weather Portfolio vs All Seasons Portfolio suggestion) and other ‘masters of the money game’. Some of the stories are interesting, and you definitely get a bit of ‘behind the scenes’ with some of the wealthiest people in USA (and the world).
For the most part, I think a number of the personal finance lessons are already followed by the F.I.R.E. community.
Things like using index-tracked ETFs instead of mutual funds/stock trader. Consolidating and maximising the use of tax-efficient accounts, like your Super. And the power of compounding over long-term investing (which always blows me away when you see it in action/charted out)…
Overall it was a decent read, and has helped reinforce some of the goals/thoughts I have had about personal finance. And also provoked a few new thoughts around new asset classes I wasn’t aware of.
Rating: 3.5 out of 5
Where to buy it
You can purchase the book via Amazon.
In interests of transparency, note this link is an affiliate link and may result a small portion of the sale going to support the running of this site.
If you interested in a ‘competing’ portfolio idea, there is an article I found here when looking at the All Seasons/All Weather Portfolio from Ray Dalio.
This post covers All Weather plus the Golden Butterfly, ultimately it is a different weighting/percentage of each type of asset. Which is right for you (if any) if probably a discussion to be had with someone who is qualified to give such advise.