Saturday, May 23, 2015

Plan Your Prosperity - The Only Investment Guide You'll Ever Need

The book Plan Your Prosperity: The Only Retirement Guide You'll Ever Need, Starting Now--Whether You're 22, 52 or 82 is written by Ken Fisher, money manager, billionaire, author, and long time Forbes columnist. (I think he is actually the longest Forbes columnist still living.)  If you are not retired, you need to start preparing now, and the book is a great starting point.

Of course, if you re already retired, you still need to do the right post-retirement planning, and the book can help with that also.

The book covers everything from why volatility should be expected, how stocks outperform bonds over the long term, watching out for scam artists, setting goals, using benchmarks, looking at timelines and much, much more.

I found chapter six the most interesting; it is called Getting that Cash Flow. Fisher first points out the risks of having a portfolio of stocks that all pay high dividends. He describes the concept of what he calls "Homegrown Dividends," which refers to selling investments to generate cash. The rest of the chapter takes you through a bootstrap Monte Carlo simulation, showing the various scenarios of the alternative cash flow levels for the life of your assets.

Appendix B and Appendix D have fill-in-the-blank worksheets that you can use to determine your cash flow, expenses, and balance sheet.

I recommend  Plan Your Prosperity for younger investors and investors who have never done any retirement planning. It will take you through the steps to a prosperous retirement.


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