JL Collins: The Simple Path to Wealth Book Review
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The Simple Path to Wealth by JL Collins is one of the best finance books, in which the author uses easy language and terminologies to explain the key concepts behind it. Especially, for those who seek to use stock market investing as a tool to accumulate wealth over time.
For many of us, complex calculations on the equities market seem almost impossible to figure out the right stock to purchase when it comes to investing in the stock market.
It’s not easy to calculate every single key metric to understand and select when will be the right time to invest. Too often, we always fall into the trap of misunderstanding between speculators and investors.
For this reason, The Simple Path to Wealth by JL Collins provides a step by step to taking the path to wealth via stock market investing. This is because you will have a chance to learn a simple and easy strategy and technique to invest in stock.
Let’s take a deep analysis of this money management book that will cover five main key aspects to explain in more detail, which allow our reader to get familiar with the concepts behind this one of the best finance books.
Part 1: Orientation
Part 2: How to Use Stock Investing to Reach Financial Independence
Part 3: Magic beans
part 4: What to do when you get there
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Table of Contents
- The simple path to wealth is one of the best investing books, which uses the four main pillars to achieve financial freedom.
- JL Collins uses his real-life story as an example to convey his idea in this book.
- One of the best financial books for beginners.
Part 1: Orientation- The Simple Path to Wealth
JL Collins decided to write the book” The Simple Path to Wealth” after providing personal finance advice to his daughter. For this reason, the author wrote this one of the best investing books to give advice and additional knowledge to young people like his daughter, which might help them to change their perception about money and be able to manage their personal finance.
In part one, the author pointed out the reason to stay away from unnecessary debts such as excessive using credit cards, and high-interest repayment, which is considered one of the root causes of your highest level of stress. (books on saving money)
It’s absolutely true due to the fact that unmanaged debt can be a real danger to impact your emotional levels such as sadness and constant worries, which might have a big impact on your daily life physically and mentally.
For this reason, JL Collins challenges everyone on how to change their perception about money and investing in order that they can solely concentrate on the simple and easy path to wealth. In other words, the end road would be to achieve financial independence and become a millionaire.
Related reading: Peter Lynch Book Review:One Up on Wall Street
Part 2: How to Use Stock Investing to Reach Financial Independence
Part 2 of this money management book ” The Simple Path to Wealth is considered the most important part because JL Collins completely changed the perception of using stock market investing as a tool to build your wealth.
In addition, the author expressed his viewpoints in this book by suggesting that people should keep things as simple as possible. In particular, you can view investing as a tool to build wealth over the long term, not the short term.
And, the book also provides information on how to use index funds, international funds, mutual funds, and exchange-traded funds (ETFs) to build your wealth over time. Those funds are particularly good for those who want to have the best possible result.
Importantly, I do really like the idea behind this section is to create a portfolio to maintain and accumulate your wealth. By allocating investment assets in a proper way, investors do not need to worry about which companies will be successful ( use index funds) or fail.
Related reading: Review of Money Book-Financial Autonomy
Part 3: Magic Beans
Part 3 of “The Simple Path to Wealth” clearly gives a solid explanation of why the index fund is the tool to build wealth over the long term. And, the author used the evidence of Warren Buffet’s ( The Oracle of Omaha) recommendations to invest in index funds and government bonds as an example to back up his explanation.
JL Collins clearly explained the 7 fundamental principles to become a stock market guru. In particular, you must stick with those principles and follow them over time, which might allow you to be more effective in the stock market.
Having a strong mental fortitude to stay longer in the game is one of the vital ingredients to staying concentrated and executing solutions when it comes to uncertainty and crisis.
Related reading: The 5 Best Investing Books For a Beginner
Part 4: What to Do When You Get There
The last part of this book is to remind you all about how to manage your budget and spend wisely. In particular, the author gave the advice to stay away from bad debt at all costs because it may have a negative impact on the income ability.
In addition, spending less than you earn and investing the surplus are the two most invaluable pieces of advice from the author, which I think is considered the most important part to reach the path of becoming financially independent.
Another important point from this book is to think of ways to give back to society once you have reached millionaire status. I think it is really meaningful to donate a small of money back to local charities, which can help to build a better place to live and may make a big change in other people’s life.
The last part of the book is the author’s personal story of planning the first 10 years, which help his daughter to stay concentrated on her study, and career and avoid all the bad debts.
That advice is strongly related to younger generations, which acts as a roadmap to remind them which are the wrong ways and right ways to achieve financial independence in the future.
By Jiro Nguyen, Founder of Jns-millennial.com
The content is based on the personal opinion of the author. It is accurate and true based on the best knowledge of the author and his research. The article should not use as a comprehensive or a substitute for professional advice.
JL Collins book
JL Collins is an author of the popular book, The Simple Path to Wealth. Recently, JL Collins publicly released the book called
What is the main concept of The Simple Path to Wealth by JL Collins?
The Simple Path to Wealth by JL Collins provides a step by step to take the path to wealth via stock market investing. Part 1: Orientation Part 2: How to Use Stock Investing to Reach Financial Independence Part 3: Magic beans part 4: What to do when you get there
What is the most important part of Simple Path to Wealth?
The simple path to wealth is one of the best investing books, which uses the four main pillars to achieve financial freedom. Including ETFs, Index funds.