Millionaire Teacher Book Review And Giveaway
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.
Here’s a link to purchase a copy of Millionaire Teacher.
I wish they’d talked about finances period. Even the basics–what debt is, why you’d want to avoid it, how to balance a chequebook, etc.
Financial planning should be mandatory in our high school system, especially the concept of starting early and compounding of investments.
I wish that I had been taught (and that children were taught today) the importance of working for an employer with a good pension and benefti plan.
I wish I learn sooner how to manage money. That way, I could have save & invest money while I was younger. Now, I’m in my late 30s, still not too late and I’m well-motivated.
I wish I had been told the immense benefits of investing/saving at a young age..actually when we were in school (graduated 1977) we learned absolutely nothing about personal finance..what a shame really..I am trying to convey to my nieces the imperative need for investing young..sure hope they’re listening..
interestingly enough I have several index funds that I contribute to bi-weekly as an employee of Kimberly Clark on which I receive a company match..I held various index funds & after reading your emailed article/s in the last few weeks I have switched over a higher investment percentage to index funds with a much lower MER than some other equity funds (Trimark) as an example than I was contributing to before..thanks..I am so enjoying the wealth of invesentment knowledge I am receiving from you..I’m 51 & hope it’s not too late to make better investment choices!!
I wish I had learned about the 8th wonder of the world. As Einstein put it…
“Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.”
― Albert Einstein
I actually don’t want to win a copy – I bought one and am reading through it now. It’s a fantastic book. Straight forward, easy to read and amusing. The only drawback is I’m kicking myself for wasting all this time in non-index funds! As for what I wish I’d learned in school – a basic overview of all the darned fees involveds in actively managed funds!
I wish I had learned about investing… and taking some risk
I wish I had been encouraged to read about money. My father owned a copy of the Wealthy Barber. I’m not sure why my parents thought it was more important to study calculus than read about personal finance.
If I was still teaching, I’d encourage students to check out PF blogs and books — especially if they’re not eager to listen to their parents or teachers.
The extent of the financial ‘education’ I received was in secondary school and consisted of assistance in applying for a S.I.N. and instruction in writing a cheque. That was it!!
I wish that I’d been made aware that I could actually take control of my personal finances and then been given some specifics about how to ‘grow’ money through various instruments and the pros and cons of each.
I wish I had learned more of the fundamentals about mortgages. Could have saved myself some interest payments if I did.
I wish I had learned about compound interest and the time value of money. Small things can really add up over time.
I wish I’d learned the evils of credit! I’m debt-free now but if I hadn’t racked up so much credit card and PLC debt through high school and university I would be much richer today!
I agree with most of the comments above. Something not mentioned is, I wish I’d learn that oftentimes, people who act like they’re rich are not rich and that it’s more important to be financially free than have a lot of stuff to show off to others (something that took me a long time to learn).
I wish I learned about personal finance fundamentals – like what different containers exist (RRSP and now TFSA) and why one should contribute to each and what the impacts are, like what stocks and options are, what the different options are in getting a mortgage, etc. I found that I only learned these things only when I absolutely had to so I didn’t make the best decisions the first time; learning about these things beforehand would have helped me a great deal. I hope I win the book!
Andrew Hallam was one of the first personal finance bloggers who reached out to say “hi” to me when I first started blogging.
I had a teacher who thought it was important enough to tell us about how interest accumulates and increases the cost of what you buy. He showed us what it cost to buy a car using a car loan. Then he told us to start now making car payments into an account. This way when it came time to buy a car, the account would have the necessary funds and we could continue this process indefinitely. This way we got the benefit of the interest in the bank account and paid no interest on the purchase of the car. I took this advice. I was 14 at the time and am now 50. I have bought every car I’ve ever owned for cash and already have more than half the money necessary to purchase the next car, even though my current car is 2 years old and I plan to drive it for another 6 years. If even 25% of the students he taught took this advice, he has done an amazing service to those generations.
Dividends. I wish someone had taught me about companies paying dividends to their stockholders 20 years ago. But better late then never!
I wish I had learned when I was young the hard lesson about the interest on credit cards.
I wish someone would have taught me ANYTHING about investing. I’m 26 now and just hitting the tip of the iceberg.
I wish schools would required at least one mandatory class on personal finances for the ‘real’ world. If high schools are suppose to be preparing you for the life after school there is nothing more important than personal finance. Love the blog and tweets, keep up the great work!
That’s easy – The #1 one lesson I wish I had been taught would be how to “Divorce your personal self from all financial decisions.” Whether it is in your business or your personal life you have to look at financial decisions with that rule in mind. You have to be able to completely detach yourself from your own wishes, desires, personal aggrandisement or satisfaction and look at everything with a critical unbiased eye. The hardest thing to do is to step out of my own body and look back at myself from the outside in a completely impersonal manner – it can can be a sobering experience. Most people only see the optimistic outcome and either don’t have all the facts or choose to ignore them. They have huge dreams and tons of enthusiasm but have not thought out how they are going to make a profit at the end of the day.
I live in Canada.
Long ago, I wish I had listened to my parents and learned to distinguish between immediate gratification (want) and the 30-day need test.
Not so long ago, from school, I would have done better with basic algebra than Latin.
More recently, I wish I had listened better in family law class at law school. I should have asked my lawyer to prepare a pre-nup agreement, rather than thinking the common-law arrangement was going to a forever thing.
Happiness is financial independence.
Cheers,
I wished school had taught the impact of income taxes and how much of my salary was going going to the government. Would have been even more useful to discuss how various types of income were taxed.
I tried to educate my children on taxes, etc at the dinner table
I wish I had learned about filing income taxes, paying property taxes, mortgages, and investing.
I think we should be teaching young people how do their taxes and the basics of investing/saving for retirement. If I knew what I know now in high school, I think I’d be further ahead.
I learned that you should start to save at least 10% of your salary each year.
I am wondering how it was back in the 80’s when I was at school. I might be wrong but I don’t think they had anticipated the future as we know it today. Was the credit so accessible. Where the pension plans funds so low. Were they thinking of lack of young workers to replace the baby boomers?
If in there mind everything was to be great with the governments looking after us, I understand why we did not get any financial educations.
But now with what I know, I wish the system would have had given us all the tools necessary to face our future. Finance is part of our daily live.
I wish I had been taught how to read and understand the jargon of finance. It’s like reading a foreign language. So for many years it deterred me from learning about personal finances, and them getting them in order.
Great review! I especially like the 9 rules!
I wish I learned value investing in school. It would have saved me from buying Nortel shares.
At school, I wish that I was taught about the concept of compound interest, and provide examples where if you can invest early even during your school years, how the benefits of compound interest can really make a difference in accumulating a decent portfolio in your retirement years.
The money lesson I wished I learned in school would have been how to invest in good company stocks at an early age with special emphasis on learning how to eliminate the fluff and poor companies who claim to be great. Basically learn how to intrepet stocks and company values.
Wow! Thanks for the amazing review Echo!
Besides learning personal finance in school, I wish I took a course on human relations. It’s so odd that we don’t usually learn the truly useful fundamentals at school. It would be great to learn how to avoid arguments at all costs, learn strategies to deal with angry people, and learn the best kind of words and phrases to use when discussing important, potentially contentious issues with loved ones and friends. Perhaps Dale Carnegie should also be on every curriculum. Thanks again for the great review!
Andrew
to Andrew above..read the book “A New Earth” by Eckhart Tolle..guaranteed to teach you or help you understand how to interact with all people, difficult or argumentative ones included..not an “interesting” read, but fascinating (you’ll understand why I said this if you read it)…a must read for everyone on the planet! I am in sales on the road for a large corporation & deal with hundreds of retail clients & this book gave an awareness about myself & others that is invaluable…no selling/listening skills courses & over 22 years we’ve had to take them all, could define the real reasons why people act the way they do..when you get it, there’s no turning back..
I wish I had learned about the power of compound interest and that someone really emphasized on the importance of starting early.
Theres a lot of things I wish I knew now… and still don’t.
If I had to choose something to be discussed in schools, I would have loved to have been taught to only invest in what you understand. Investing without knowledge is gambling.
I wish someone had told me Rule #3. Had I started saving and investing even half of my $300 paychecks in high school when I had no expenses except FUN, I probably wouldn’t have to work until 67 years of age!!! Hindsight, what a wonderful thing!
Thanks, I love your daily posts.
Cheers!
Lesson: That the secret to wealth is discipline. Determination comes next. Can’t wait to visit Andew’s blog.
Been trying for the last two hours to get to andrewhallam.com……not responding, not responding.
So far the only contradictory statement I have found is in one section he says, that it is essential to use non-taxable investments and then on page 122, he says, “But one thing is certain: if you build a diversified account of index funds, you’ll beat 90 percent of professional investors. In a taxable account, you’ll do even better.”
I would like to know why he changed his mind. Because the first thought was that one did not pay taxes yearly on gains if one invested in indexes but one only payed out taxes as one redemned them, which made sense. So I am confused about the second statement. If you can find the answer I would like to know the specific difference. Or, maybe I just misread it.
Hi Sabrina,
My apologies, my site was having troubles over the past week.
Investors need to fill up their tax advantaged opportunities first–by maximizing their allowable contributions to RRSPs and TFSAs. Only then does it make sense to invest outside of a tax deferred plan.
Inside a tax deferred plan, indexed portfolios have a much higher likelihood of success compared to actively managed portfolios.
But once you have filled up your allowable, annual room in tax advantaged options (RRSPs, TFSAs) then you’ll need to invest the extra money (if you have saved that much) in taxable accounts. These are not as efficient, taxwise. However, big savers could fill up their RRSP and TFSA contributions quite quickly.
The point in my book was this:
An indexed portfolio in a taxable account will have a huge advantage over an actively managed account in a taxable plan. The difference, in the taxable account (between indexed and non indexed) will be even greater than it would be inside a tax sheltered account, because indexes are far more tax efficient than actively managed funds, due to the lower relative turnover. Actively managed funds trade stocks within them (generating taxable hits) while indexes do very little trading (keeping the fund more tax efficient). Capital gains, in taxable accounts, are only generated when an investor sells something. You, personally, may not be selling your fund, but the active managers running the mutual fund are, and you get hit with the tax bill, if your fund is held outside a tax sheltered account.
I hope that clears things up.
Cheers,
Andrew
I actually learned a lot about personal finance in high school – I took business as a class in Grades 9 and 10. We learned how to make a basic business plan and how to create a retirement plan as major class projects. We also did stock picking competitions to see who could pick the best portfolio over the course of a semester. I wish we’d learned more about stocks though – like how to actually buy them, evaluate them, dividends, etc.
Great article i am receiving everyday!!
I wish school had taught me to enquire about fees when purchasing financial products and the significant impact it has on growing your investments.
I wish i had school telling me to put my summer money into an index fund! Who knows, that summer money could have been worth 5x or more!
Never too late though…
I wish they taught us about Investments and the different kinds of it.
I wish I knew the magic of compounding earlier. I started in my late 20’s, not doing too bad, but could have done better.
Personal Finance should be a core curriculum course in school – it always fascinates me how we train to earn a living, but receive no education in school on how to keep what we earn.
I wish we’d have learned something about how the stock market works. What does it mean when it goes up or down? I’m 25 now and I still only have a fuzzy idea about it.
I really wish that school instilled the idea that there are fees, and more fees, and yet more fees that may compromise the message that “this” is the best thing to do with your money. It wasn’t until I started reading all these blogs that I found out why my money wasn’t making money–despite assurances that the funds were “doing well!”
I wish had been taught how “investing” wasn’t just for the “rich people” and that anyone could start small and accomplish a lot, given time and a bit of knowledge.
I wish they had taught us about the huge benefit of compound interest even on a relatively small investment of $1,000 year…funnily enough, some bank staff @ TD Bank don’t even know about E-Series Index Funds..which baffles me..opened up my account & thank goodness I have had quite a bit invested in index funds just by default even though they are not the lowest MER offered out there..it’s like the E-Series is hidden, so unless you have this information I am learning through Millionaire Teacher & this blog, you just don’t know they’re out there or can’t get at them..best kept secret I guess & I’m guessing the banks would like to keep it that way..
I just found a 1 day camp for teens in Ottawa entitled “what is a budget”. I wish they offered financial planning courses when I was in school.
Just wondering… Did someone win this book ? Thanks!
Hi Kevin, yes Eleanor won the book.
Thanks… And congrats to Eleanor !
Thanks a lot! Can’t wait to read the book!