IF YOU ARE a reader of this column, I assume that you enjoy reading about finance, investing, taxes and retirement. Do you also read books on these subjects?
I’m asking the question because I had a recent debate with a close friend who told me people don’t read books anymore. Instead, he said, they turn to the internet for answers to specific questions they have.
I disagree. I believe that book readers want more than what comes to mind to be researched online. I believe they might want to explore areas that they might not be familiar with — questions that are not apparent enough to be asked. You’ll have to let me know before I write my next book.
Let me give you a few examples. In “Better Good Than Lucky: How Savvy Investors Create Fortune With the Risk-Reward Ratio,” Charles Rotblut starts with this premise: “Smart investors create their own ‘luck.’ ” An important element is limiting risk by applying a risk-reward ratio that is introduced and explained eloquently in the book. That’s a book I can recommend, since my day job is managing portfolios, primarily for conservative retirees.
Another is Hewitt Heiserman Jr.’s “It’s Earnings That Count: Finding Stocks With Earnings Power for Long-Term Profits.” Heiserman asks: What would your life be like if you paid $10,000 for a stock that a decade later was worth just under $1 million (1990: Microsoft)? He introduces the Earnings Power Chart, which was inspired by Benjamin Graham’s “The Intelligent Investor,” a classic that I also recommend investors read.
Since we’re on that topic, here is a list of other classics: “Security Analysis: Principles and Techniques” by Graham and David L. Dodd; “Portfolio Selection: Efficient Diversification of Investments” by Harry Markowitz; “Reminiscences of a Stock Operator” by Edwin Lefevre; “Confessions of a Stockbroker” by Andrew A. Lanyi; Graham’s “The Interpretation of Financial Statements”; and Charles Ellis’ “Winning the Loser’s Game: Timeless Strategies for Successful Investing.”
For fans of the legendary investor Warren Buffett, you have “Buffett’s Bites” by L.J. Rittenhouse; “Even Buffett Isn’t Perfect” by Vahan Janjigian; “Warren Buffett’s Ground Rules” by Jeremy C. Miller; and “Buffettology: The Previously Unexplained Techniques That Have Made Warren Buffett the World’s Most Famous Investor” by Mary Buffett and David Clark.
For retirement planning, I like “The Bogleheads’ Guide to Retirement Planning.” This is also a topic I enjoy writing about (for example, “Retire Securely” and “The AARP Retirement Survival Guide,” which was updated as “The Retirement Survival Guide”). You also have “Rewirement: Rewiring the Way You Think About Retirement!” by Jamie Hopkins.
For a lighter touch on the subject of retirement finance, there is Jane Bryant Quinn’s “How to Make Your Money Last”; Stan Hinden’s “How to Retire Happy: The 12 Most Important Decisions You Must Make Before You Retire”; and of course, Ernie Zelinski’s “How to Retire Happy, Wild, and Free: Retirement Wisdom That You Won’t Get From Your Financial Advisor.”
Finally, and probably most importantly, I am a fan of the annually updated “Stocks, Bonds, Bills, and Inflation (SBBI) Yearbook.” That’s simply the best reference book on the markets in print. There you will find financial market data that is essential for any serious investor to study, including monetary policy, long-run perspectives on the markets, portfolio optimization, international equity investing, wealth forecasting, growth and value investing, and the like.