Qi of Personal Finance and Investing (eBook)

A Heretic's Guide

M.D. Frank Seinsheimer III (Autor)

eBook Download: EPUB

2021 | 1. Auflage
196 Seiten
Bookbaby (Verlag)
978-1-0983-5050-5 (ISBN)

Infos

How do you invest wisely? How do you understand and handle risk when investing? Why does using a financial manager harm your long term investing results? Why does the average investor underperform a straightforward stock index fund? What should you do with your savings? How do you prepare financially for retirement? How do you handle your money in retirement? Why is the basic theory underlying the advice you receive from financial advisors wrong? All of these questions and more are answered in 'The Qi of Personal Finance and Investing.' In this book I explain why the approach to investing used by your financial advisors and financial managers will harm your long term investing results. My answers to these questions are heretical. I explain why my answers are correct! I have read extensively in finance and investing literature and have spent decades studying, understanding and finally disagreeing with the basic theory underlying the decisions of the financial world. I have reached conclusions regarding personal finance and investing which are distinctly different, i.e. heretical, from the standard advice given by most financial advisors and financial managers. This book details my conclusions and advice to you, the reader.

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How do you invest wisely? How do you understand and handle risk when investing? Why does using a financial manager harm your long term investing results? Why does the average investor underperform a straightforward stock index fund? What should you do with your savings? How do you prepare financially for retirement? How do you handle your money in retirement? Why is the basic theory underlying the advice you receive from financial advisors wrong? All of these questions and more are answered in "e;The Qi of Personal Finance and Investing."e; In this book I explain why the approach to investing used by your financial advisors and financial managers will harm your long term investing results. My answers to these questions are heretical. I explain why my answers are correct! I have read extensively in finance and investing literature and have spent decades studying, understanding and finally disagreeing with the basic theory underlying the decisions of the financial world. I have reached conclusions regarding personal finance and investing which are distinctly different, i.e. heretical, from the standard advice given by most financial advisors and financial managers. This book details my conclusions and advice to you, the reader.

Textauszug

Preface

First:

Most people feel that the subjects of personal finance, investments and generally the whole financial world are too complicated for them to understand.

NOT TRUE; NOT TRUE; NOT TRUE

This book differs from other personal finance and investing books in a number of crucial aspects.

Because in this book:

I explain why:

USING FINANCIAL MANAGERS ACTUALLY HARMS YOUR LONG TERM INVESTING RESULTS!

I explain why:

FOLLOWING THE ADVICE OF MOST FINANCIAL ADVISORS HARMS YOUR LONG TERM INVESTING RESULTS!

I explain why:

FOLLOWING THE CURRENT INVESTING THEORY (MODERN PORTFOLIO THEORY) HARMS YOUR LONG TERM INVESTING RESULTS!

I explain why:

THE FAILURE TO MINIMIZE YOUR YEARLY COST OF INVESTING HARMS YOUR LONG TERM INVESTING RESULTS!

I explain why:

EXCESSIVE DIVERSIFICATION HARMS YOUR LONG TERM INVESTING RESULTS!

I explain why:

UNDERSTANDING RISK, INFLATION AND EXPONENTIAL GROWTH ARE NECESSARY FOR YOUR FINANCIAL LITERACY!

I explain why:

IT IS IMPORTANT TO LEARN ENOUGH ABOUT PERSONAL FINANCE AND INVESTING TO BECOME YOUR OWN TEACHER!

I explain why:

YOU NEED TO BE CAREFUL WHO YOU TRUST WITH YOUR MONEY!

I explain why:

YOU NEED DISCIPLINE IN YOUR SPENDING BEHAVIOR!

I explain why:

I CONSIDER MYSELF THE PACHYDERM IN THE PARLOR OF PERSONAL FINANCE AND INVESTING!

I explain why:

MY OPINIONS AND ADVICE REGARDING PERSONAL FINANCE AND INVESTING ARE HERETICAL!

Enough of the “I explain why’s”.

Let’s move on.

In this book I present a simple and effective method for successful long term investing. Note, please, my emphasis on long term. I will explain in simple terms why I believe that the basic theory (Modern Portfolio Theory) used by most financial advisors and financial managers is flawed. I will discuss why I believe following this theory results in sub-optimal investing results. I will explain why I believe that the basic theory underpinning all of the financial advice you hear and all of the financial management you receive will actually harm your long term investing results.

There! I have set myself a high bar to clear. I have declared myself a heretic.

I have found through past experience that financial advisors and managers seem to deliberately present their advice in a complicated manner. I believe that they do this to intimidate their prospective clients. I believe that they do this to make the clients feel that they, the clients, desperately need the advice and management of their financial advisors and financial managers. As you read this book, you will understand why I recommend against the use of financial advisors and financial managers who charge a percentage of your invested assets each year.

Second:

Why am I writing this book? The lack of “financial literacy” in the general population is huge! My purpose in this book is to provide an understandable approach to financial literacy.

What is financial literacy?

Definition:

“Financial literacy is the possession of the set of skills and knowledge that allows an individual to make informed and effective decisions with all of their financial resources.” (Wikipedia, September 18, 2020)

Note:

Many of my references to other sources will be to Wikipedia. This open, free online encyclopedia is available to any and to all for free. The entries in Wikipedia may be changed at any time by the Wikipedia editors. Thus, my references to Wikipedia will give the date I went online to Wikipedia for the information or the quote. Similarly, my references to other websites, which are also subject to change, will include the date I obtained the quote online.

Back to financial literacy.

This book is all about your (the reader’s) financial literacy. I will cover issues like saving, investing, who you can trust, who you should not trust, buying a car, buying a house, why you should not use a financial manager who charges a percentage of your investment each year, why you need to keep your yearly cost of investing low and last and most important why you need to become your own financial manager.

I discuss how you should take control and manage your own money and investments. I discuss how you should understand the “keep it simple stupid” basics of our seemingly complex financial world. I discuss in detail the difference between what seems risky and but is actually relatively safe in the investment universe. I discuss in detail the difference between what seems safe but is actually risky in the investment universe. My opinions regarding risk in investing are “heretical.” Issues concerning risk and uncertainty pervade our lives and our financial decisions. I discuss and explain these issues in sufficient detail that you will be able to understand them. This is crucial to making sound financial decisions.

I believe that most financial advisors and financial managers calculate the “risk” of your basket of investments incorrectly! I explain why I believe this. I explain why I believe calculating the “risk” of your investing incorrectly harms your long term investing results. I discuss my heretical opinions regarding what I consider to be the major flaws in the financial advice and financial management provided by most financial advisors, financial managers and financial firms.

Financial literacy is vitally important to your future. Distinguishing between what is actually relatively safe and what is much riskier than it seems is the crux of my argument in this book. This book is designed to improve your financial literacy. This book does not attempt to cover all aspects of your financial life in encyclopedic fashion. This book does not discuss issues like how to get out of credit card debt.

This book is oriented more toward advising you why it is important to start saving money when you are young.

This book is oriented more toward advising you what to do once you start to save some money.

This book is oriented more toward advising you how to invest wisely.

Consider this book your introduction to becoming financially literate.

Consider this book the beginning of your financial education not the end.

Third:

Before I write anything else, let me assure you that there is no math in this book. There are no graphs in this book. I explain everything in terms that someone suffering from arithmophobia or numerophobia is able to comfortably understand. Arithmophobia and numerophobia are real words describing people with fear and anxiety regarding numbers and math.

Fourth:

Not another money book! This one is not written by a popular financial guru but by a common-sense practical guy. I am an orthopedic surgeon, a hand surgeon and I have black belts in three martial arts, tae kwon do, aikido and Japanese jujitsu. I also teach my version of martial arts, “Unarmed Defense Against Weapons.” I am not a professional financial advisor. I am not a financial manager trying to drum up new clients. I am not a popular, modern media, financial personality desperate for viewer ratings.

Many years ago, when I became a partner in my orthopedic group, I realized that I was a fiduciary for the profit sharing plan which covered all of our employees including myself.

Definition:

A fiduciary is a person who holds a legal or ethical relationship of trust with one or more other parties (person or group of persons). Typically, a fiduciary takes care of money or assets for another person.” (Wikipedia, August 21, 2020)

Recognizing my responsibility to my employees and also desiring best investing results for myself, I realized that I had little idea why our financial advisors and financial managers were telling us what they were telling us. I had little idea why they were making the decisions, they were making for us for the investments in our profit sharing plan.

Let me restate that.

It wasn’t that I had little idea why they were saying what they were saying and why they were managing our money the way they were managing our money. Actually, I had NO idea whatsoever. To be trite, I realized that I was truly clueless.

I wanted to understand the who, what, why, when and where of personal finance and investing.

I do not like being ignorant regarding a topic important to my life. I wanted to understand what the hidden gears beneath the financial industry surface were doing. I am an avowed sceptic. I wanted to understand the motivations of our financial advisors and managers. Actually, I wanted to understand the motivations of ALL financial advisors and ALL financial managers.

I began extensive reading regarding finance and investing. I took most of the finance, economics and investment courses in the Masters in Business Administration (MBA) extension program of Johns Hopkins University in the evening. I skipped the marketing courses. I did not see a personal need for the other courses and felt no reason to continue to obtain the MBA degree.

Fifth:

I consider myself a practical idealist. As...

Produkt-Details

• Erscheint lt. Verlag: 21.1.2021
• Sprache: englisch
• Themenwelt: Wirtschaft ► Betriebswirtschaft / Management ► Finanzierung
• ISBN-10: 1-0983-5050-2 / 1098350502
• ISBN-13: 978-1-0983-5050-5 / 9781098350505