Book review of “The Only Investment Guide You’ll Ever Need”

Andrew Tobias “The Only Investment Guide You’ll Ever Need”

Tobias’ “The Only Investment Guide You’ll Ever Need” shows readers how to multiply their money without having to work for it. The book, initially published in 1978 and updated in 2016, teaches healthy economic habits to help people get more out of their money. Tobias believes that most investment books are fraudulent and that reading too much about investing might make investors worse off.

Tobias’ book emphasizes the need to see the big picture before beginning an investment journey. He anticipated that the American economy would be roughly the same as it had been in 1978, with low inflation, low-interest rates, and a large national debt. Tobias expected that the years after 2016 will be particularly hard.

Having a low debt ratio gives you wiggle room in case of difficulties or financial tragedy. However, the United States’ national debt has skyrocketed since 1980, resulting in infrastructure deterioration and the possibility of a 35-year drop to 30% of GDP. Interest rates have also fallen, down to $20 per $1,000 in 2016. Tobias expects that interest rates will rise again, resulting in lower bond prices.

On the positive side, the last 50 years have seen an explosion of new technology, with futurist Ray Kurzweil projecting almost free energy, cheaper products, and higher living standards for people all around the world. To make the most of what is to come, investors should cultivate sound economic and financial habits.

In conclusion, Tobias’ “The Only Investment Guide You’ll Ever Need” is an excellent resource for individuals wishing to increase their wealth without having to work for it. Individuals can attain financial success by cultivating responsible economic and financial practices.

Tobias suggests that saving at least $1,000 per year is critical because you are at a higher tax rate than you realize. Income tax in the United States is progressive, which means you pay relatively little on the first few dollars you earn and a lot on the final few. To save money, try spending less rather than saving more. Charles Revson of Revlon, for example, saved $20 by purchasing wine bottles by the case rather than single bottles, resulting in an investment return of 20% to 30% per year, tax-free.

To avoid paying too much in taxes, consider having children and compounding some of your savings tax-free by putting money in their names under their Social Security numbers. Open savings or brokerage accounts in their names and allow them to pay taxes on the interest or dividends. This is still cheaper than paying, and you can withdraw funds at any moment. However, this technique has drawbacks, such as the need to submit additional tax returns each year, and the money now belongs to your child.

Retirement plans are another excellent method of losing money. If you want to retire comfortably, consider using a tax-deferred retirement plan such as a 401(k) or 403(b). Employers frequently contribute some money to these “salary reduction plans,” and whatever money you put into them is tax-free.

If you are serious about not only saving but also investing your money, consider investing in stocks. Tobias believes that stocks have the potential to keep up with inflation, beat other “safer” assets, and serve as a tax shelter. The stock market is simple, with just two possible outcomes: up or down and only two emotions that can push the market in any direction: greed or fear. There are only two methods to make money in the stock market: dividends or capital gains, and there are only two types of investors: individuals and institutions.

The most straightforward way to invest is to place your money in no-load index funds, which invest in all equities accessible. Mutual funds offer extensive diversity and are frequently part of a fund family, such as Vanguard or Fidelity. A worldwide portfolio reduces risk while increasing profits because stock markets in various nations move up or down independently of one another.

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