Book Review – The One Page Financial Plan by Carl Richards

It’s been a while since I did a book review. I have done a lot of reading on the internet (blogs, articles, etc.) but not many new books. Recently I saw an article on this new book The One Page Financial Plan, and it intrigued me. So I took the opportunity to purchase the book and read through it. So here goes.

First of all, those who are hard core FI people will find little for their number crunching here. The book is rather small on calculations, ratios, etc. If you are looking for a book to go through your investment strategies or net worth calculations, then there are other ones which will do a better job than this one. That is not the objective of the writer. Instead, he offers a less-number oriented, more “touchy/feely” type of financial plan book, as one might expect from the title.

The first part of the book is the “discovery” phase, where the authors uses some questions and exercises to help the reader determine the “why” for their financial planning (the most important question), the where (where you want to go, i.e. goals) and where you currently are (net worth, assets & liabilities, etc.). Again, very few numbers are discussed or worked through here.

The second part of the book works through spending and saving. He discusses simple ways to determine your current spending and how to create a basic budget. He then ties that back to the goals developed in the first section, and uses that to motivate the reader to save.

The third section discusses investing and other finance topics, including insurance (buy as little as necessary, but buy it), debt (good and bad), and basic, beginner investing – with a heavy emphasis on index funds, and buy & hold strategy. He finishes with some good information on the need for rebalancing. As before, there is a startling lack of numbers in these chapters – just basic common sense for the beginning investor.

The final section covers avoiding big mistakes that can sideline you (not hiring a good financial advisor to help teach you, always making the decisions instead of trusting the advisor, not panicking at market dips, etc.). His lesson is one of basic, boring investing over time.

In the end, I believe this is a good book for folks who are just getting interested in the FI journey, or for those passionate FI people that are trying to interest another (a spouse, a family member, etc.) in many of the concepts and ideas. It’s a great book for someone to get started, and then as they grow in interest and knowledge, they can seek out additional, more detailed information for those topics that interest them.

 

Mr. 39 Months

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