The Wealthy Barber - Calgarypuck Forums - The Unofficial Calgary Flames Fan Community

albertGQ · 06-30-2009, 02:19 PM

So I am reading this book. Its pretty small so I'm almost done actually. Anyone read this before? Has anyone actually followed his advice (save 10%, etc)?

Am I going to retire a millionaire now that I've read this!?!?!?!?

Bobblehead · 06-30-2009, 02:27 PM

Easy read and if you do what it says you won't necessarily become a millionaire, you will be far better off than flying by the seat of your pants.

Wills, dollar cost averaging, etc are all things people should do but many don't. 10% is kind of an arbitrary amount, but if you can do it, great, and if you can't then ANYTHING > nothing.

albertGQ · 06-30-2009, 02:35 PM

A side question. How important is it to have a will and life insurance. Even after reading those chapters, I still don't feel the need for me to go out and get either

Phanuthier · 06-30-2009, 02:36 PM

Quote:

Originally Posted by albertGQ

Am I going to retire a millionaire now that I've read this!?!?!?!?

Maybe, but that million bux allure might get killed by inflation.

I get the general idea of the Wealthy Barber, not sure I agree with it.

I took a few finance/management classes back in my university undergrad and in one of them, the prof did a spreadsheet of how much money you need to survive in retirement. He factored in medical costs (notably average cost of a living person in their last year of life), housing costs, inflation, tax and so on. Without government assistance, and under $100k+ saving something like 10% to 20%, you wouldn't have enough $$ to survive past 90. (or something along those lines, does not include pension plans) Basically, you can predict almost the exact day you run out of money.

Very telling stat, which got me thinking, just slaving away working for the man and throwing the money in some bond or mutual fund just isn't the formula of finance that makes sense for me. There has to be other ways to guerentee your survival without having to depend on someone else.

Oh, and I currently have a will. Since you have a little rugrat running around, I'd say you probably should get life insurance.

FLAMESRULE · 06-30-2009, 02:38 PM

Great book to read and follow. Its pretty much a lot of common sense, but the biggest lesson BY FAR is to pay yourself first. I started with the 10% rule and it sucked at first, but you dont even notice the money is out of your account. I think I'm upwards of 15% now.

It also shows the power of compounding interest.

I should really go and re-read that book. One of the very few books my parents "forced" me to read, and it was well worth it.

Bobblehead · 06-30-2009, 02:39 PM

Quote:

Originally Posted by albertGQ

A side question. How important is it to have a will and life insurance. Even after reading those chapters, I still don't feel the need for me to go out and get either

You have a family, so I would say VERY important, and there are people on this site who can help you with both of those ttroutman does wills, I'm unsure about the other lawyers; Slava, moneyguy are both financial advisers so they would be excellent to speak with as well, and would tailor something to suit your own situation.

Azure · 06-30-2009, 02:41 PM

If you have a family, having a will and life insurance is VERY important.

albertGQ · 06-30-2009, 02:42 PM

Quote:

Originally Posted by Phanuthier

Maybe, but that million bux allure might get killed by inflation.

I get the general idea of the Wealthy Barber, not sure I agree with it.

I took a few finance/management classes back in my university undergrad and in one of them, the prof did a spreadsheet of how much money you need to survive in retirement. He factored in medical costs (notably average cost of a living person in their last year of life), housing costs, inflation, tax and so on. Without government assistance, and under $100k+ saving something like 10% to 20%, you wouldn't have enough $$ to survive past 90. (or something along those lines, does not include pension plans) Basically, you can predict almost the exact day you run out of money.

Very telling stat, which got me thinking, just slaving away working for the man and throwing the money in some bond or mutual fund just isn't the formula of finance that makes sense for me. There has to be other ways to guerentee your survival without having to depend on someone else.

Oh, and I currently have a will. Since you have a little rugrat running around, I'd say you probably should get life insurance.

This is what I'm currently doing. Pumping my RRSP savings in mutual funds. Obviously I haven't been doing too well the past 12 months. What do you suggest?

albertGQ · 06-30-2009, 02:44 PM

I'm guessing I should wait until after we get married to get a will and life insurance hey? Its only three months away so not that long at all.

CaptainCrunch · 06-30-2009, 02:46 PM

My retirement plan requires a major felony and an extended prison term.

Bobblehead · 06-30-2009, 02:49 PM

Quote:

Originally Posted by albertGQ

I'm guessing I should wait until after we get married to get a will and life insurance hey? Its only three months away so not that long at all.

Why wait?

Hanna Sniper · 06-30-2009, 02:49 PM

Quote:

Originally Posted by albertGQ

A side question. How important is it to have a will and life insurance. Even after reading those chapters, I still don't feel the need for me to go out and get either

Very, my sister died this past year and no one would have imagine the garbage my family has had to go through because there was never one.

you wouldn't believe how many hours I've spent in the lawyer office, a pure shame

Phanuthier · 06-30-2009, 02:51 PM

Quote:

Originally Posted by albertGQ

This is what I'm currently doing. Pumping my RRSP savings in mutual funds. Obviously I haven't been doing too well the past 12 months. What do you suggest?

Its a mix of money from occupation (jobs, royalties, maybe entrepreneurship) and actively management my own money (i.e. rather then mutual funds). My idea is that at any given year, I should never spend more then I passively make.

Quote:

Originally Posted by albertGQ

I'm guessing I should wait until after we get married to get a will and life insurance hey? Its only three months away so not that long at all.

No you should probably get it now. Someone could give you better info on this, but if you get it now then its actually better. My insurance agent is trying to sell me life insurance right now (probably will buy in the next few months) and I'm not even married or have a little kid.

Phanuthier · 06-30-2009, 02:52 PM

Quote:

Originally Posted by CaptainCrunch

My retirement plan requires a major felony and an extended prison term.

Ha! That was what my prof said too. Prison life, I guess, beats the hell out of homeless life.

albertGQ · 06-30-2009, 02:54 PM

Quote:

Originally Posted by Bobblehead

Why wait?

Well, I'm thinking my will has to change since I got married?

Reapply for life insurance since I got married?

I'm guessing I'm wrong

MoneyGuy · 06-30-2009, 02:55 PM

Anyone who has assets like a house, cars, investments, etc., plus a spouse and children who doesn't have insurance plus wills, POAs and personal directives is making a big mistake.

Think of it like auto insurance. Would you drive your car without insurance? I hope we agree that would be stupid. Insurance and wills are sort of like that. You hope you won't need them, and you probably won't, but it's very important protection. And use a lawyer. I've seen huge mistakes made because someone cheaped out and did a do-it-yourself will and screwed up. Your loved ones deserve better.

I've been following the advice in the Wealthy Barber for 30 years and I'm proof it does work. That's why I'm the MoneyGuy.

edn88 · 06-30-2009, 03:06 PM

The wealthy barber should be standard reading for Grade 12 students, if not college students.

The pay yourself first priniciple and saving 10% are all words of wisdom. I know too many people who got themselves into problems that would not have existed had they read and followed the basics of the Wealthy Barber.

Peanut · 06-30-2009, 03:09 PM

Rich Dad, Poor Dad is another good read if you're interested. Quite different than the Wealthy Barber, but taking info from both books together is a good combo IMO.

And I agree with everyone else about the Will(s) and Life Insurance. Do it... do it now!!

Bobblehead · 06-30-2009, 03:10 PM

The Wealthy Barber isn't the be-all end-all, but it is a darn good place to get started.

If you want to go further, you need to educate yourself on the risks, and so on. But seeing retired folk with their only income being Old Age Security and CPP, well, no one should try to live on just that. If you follow the basic rules in the book, you WON'T end up like that.

Antithesis · 06-30-2009, 03:15 PM

I understand retirement savings are good and all, but I find it amazing that people save for them at all while carrying consumer debt.

If you have:

- credit card debt
- department store credit
- line of credit

You definitely need to pay that off before paying for retirement (in my mind). It's strictly a numbers thing. Paying off your Visa is a guaranteed return of about 19%. Hard to beat that consistently in the stock market.

Easy for me to say I guess with my pension through work but I think people get caught up in a lot of "OMGZ I need to save for retirement!!!" Through commercials and banks and such when debt reduction is always a valid and sensible thing to do.

I know MoneyGuy may not be thrilled with this recommendation as a be-all and end-all but I feel a lot more comfortable with money and things like that since I began reading MoneySense magazine. Sheds a lot of light on things like the idea that everyone needs $1,000,000 in RRSPs to retire and such.

Oh, and if you have anyone depending on your income, a TERM life insurance policy (I am very thankful for mine sold to me by MoneyGuy) is an essential.