I recently picked up and read through Andrew Hallam‘s books “Millionaire Teacher” and “Global Expatriate’s Guide to Investing”. Both area easy reads with plenty of useful examples of how to save more and avoid getting ripped off by salespeople posing as financial advisors. Even though I don’t agree with everything he says, I would recommend these books to clients.
Millionaire Teacher is actually about how Andrew, as a teacher, became a self-made millionaire in his 30s, and how others with a teacher’s salary can do the same. The “Global Expatriate’s Guide to Investing” names more names, both of firms notorious for opaque, high-fee products (e.g. Zurich, Friends Provident) and for firms he recommends for expat investors (including Interactive Brokers, Saxo, and DBS Vickers), and separate chapters on how he recommends American, Australian, British, Canadian, Kiwi, South African, South American, European, and Asian expats invest.
I very much agree with Andrew Hallam on the following points:
- It is best to avoid buying products from salespeople disguised as financial advisors (one main question to ask is how they get paid, and whether they invest their own money the same way)
- The best way to build wealth over the long term is to save regularly, invest somewhat aggressively, and avoid excessive fees
- Human nature can be one of the biggest obstacles to #2
- “Expatitis” can make #3 worse, but also provides other advantages and perspectives
The two main areas I disagree with Andrew are:
- Index funds: while I believe (and practice) low-cost index funds and ETFs can make an excellent core of many investment portfolios, and GFM does manage Vanguard portfolios, I myself replace index funds with direct, diversified portfolios of 20-200 individual stocks when I can. I myself hold less than 5% of my own wealth in index funds (most of which are in accounts like 529 plans that allow nothing else), because I prefer to own the stocks directly.
- Home bias: while I would invest a Canadian’s portfolio differently than an American’s portfolio for tax reasons, I do not agree that an investor should hold the majority of their stock exposure in their home or destination country of residence. Canada is just one example where locally listed stocks disproportionately represent banks and natural resource firms, and would underweight exposure to global technology and health care profits that millionaire teachers should own whether they live in British Columbia, British Virgin Islands, or the British Indian Ocean or Antarctic territories.
Happy reading, and please do let me know if you have other thoughts and recommendations on these or other books.