‘One job is not enough’ is the title of the first chapter and sets the scene for an interesting and rewarding book, which explains how you can invest in start-up businesses while holding down the day job.
Unfortunately, I did not get off to the best start with the author, Peter Alcaraz (a qualified lawyer), warning readers off financial advisers in the introduction. He does not quite call us sharks, merely “hungry fish waiting for tasty morsels”, and telling the reader: “You’re on your own. It’s best to realise that early.”
I wonder if he has the same view of his own legal profession?
Putting his view of financial advisers aside, the book is no doubt aimed at the public and contains some valuable information and guidance, such as the difference between appreciating and wasting assets, different types of investments, the power of compounding – both positively on investments, but also negatively on debt – and the benefits of avoiding unnecessary debt.
Mr Alcaraz explains that taking control of your lifestyle is key. Too many live an expensive life sold to them by glossy media and the social pressure of keeping up with their peers.
By taking control and reducing their needs, Mr Alcaraz correctly tells the reader that this has the double benefit of reducing the amount they need to achieve financial independence, while simultaneously increasing the ongoing savings and investments they can commit towards attaining it.
It is worth pointing out that the author’s own financial success seems to have been partly the result of prudent or lucky property investment, and I tried but failed not to laugh when – given his early slating of advisers – he told of his woes with Equitable Life and Allied Dunbar pensions.
It is hardly the most inspiring read but the book gives some good, if not exactly new, guidance. There are also some flaws, such as relying on the rent from just one property to provide a significant part of your retirement income, and some of the maths (CAGR, FV), while not particular complex, might leave many readers scratching their heads and wondering if this really is an ordinary person’s companion.
Overall I think this is one for the DIY hobbyist, with their homemade spreadsheets happily avoiding our advice costs and ignoring the value we professional financial planners might add to their affairs.
Published by Hutchinson Reed.
Scott Gallacher is a chartered financial planner at Rowley Turton