Become financially fire-proof with Scott Pape's 9-step plan
Image Credit: The Barefoot Investor, 2017
Scott Pape, known as The Barefoot Investor, is an investment adviser who has appeared on TV and radio, and has been writing newspaper columns for a number of years.
I've been reading Scott's column in the Sunday paper for a while and couldn't wait to get my hands on his latest book 'The Barefoot Investor: The Only Money Guide You'll Ever Need'. I really enjoyed it, and it's one that I'd highly recommend to anyone who wants to take control of their money and build wealth.
The Barefoot Investor provides steps to give readers control over their money and their life. Image credit: Pixabay, 2013
The book begins with Pape's story of how he and his family lost their house and possessions in a bushfire. He relates the story of how they planted an apple tree and how, over time, the tree will grow and produce fruit, and he relates this to growing wealth (plant, grow, and harvest).
Pape then introduces readers to his nine steps to wealth, which he takes the reader through in detail during the following chapters. In the first step, Pape advises readers to set up a monthly 'Barefoot Date Night', and this section looks at things such as insurance, setting up no-fee bank accounts and superannuation.
Pape doesn't want his readers to worry about budgeting their money down to the last cent, or setting up complex spreadsheets. Instead, he outlines his 'serviette strategy', which involves a simple bucket system, where the reader's income is split into 3 buckets: 'Blow' (Daily expenses and splurge money), 'Mojo' (Safety Money), and 'Grow' (Long-term wealth)
Following these chapters, Pape continues with the next steps, addressing debt, buying (and paying off) a house, retirement and building wealth.
A possible way to use a bucket. The Barefoot Investor, however, recommends buckets as a means to divide up your income. (Image credit: DigiPD at Pixabay, 2012
Sometimes personal finance books can be a bit dry, but Scott has a fantastic ability to convey all of the essential information in a humorous, conversational style, with plenty of pop culture references (including the musically talented, but not-so-financially canny MC Hammer). He also uses humour to address common reader responses to his advice (e.g. "It's too much hassle to change banks")
The chapters are full of information, yet concise, and are broken up with personal anecdotes and profiles of readers who have turned their lives around financially.
The Barefoot Investor recommends eliminating debt, starting from the smallest debt and working upwards, tackling your largest debt last.
Scott is also very honest and upfront, and is not afraid to voice his opinion about topics such as the Commonwealth Bank's Dollarmite program, AMP superannuation fees, and Australian Scholarship Group.
He prides himself on being "fiercely independent and [having] no tie-ups with any financial institution, whatsoever" (p. 16), so his recommendations are based on what he believes are the best deals for his readers, not based on who is paying him a commission.
Foreign ATM fees: The Barefoot Investor says that you shouldn't be paying them, and he advises readers on how to use foreign ATMs without being charged. Photo by krosseel at Morguefile.com
One of the things I loved about this book is that it's written by an Australian, for an Australian audience. Many books I've seen in the finance section of bookstores in Australia are written by American authors, so it's great to pick up a book that recommends bank accounts available to Australians, discusses the Australian housing market, and refers to the Australian superannuation scheme.
I also like the fact that Scott is very understanding about how people fall into the credit card trap, or end up in other financially challenging situations, and he is very passionate about helping his readers get back on their feet and move forward financially.
Overall, I recommend this book to anyone who is looking for solid advice and easy-to-follow steps on how to become financially secure and reach their financial goals. It is suitable for people in a variety of situations - whether they are just entering the workforce, saving for a house deposit, trying to get out of debt, or planning for retirement.
By following The Barefoot Investor's nine steps to wealth, you can reach your financial goals - whether they be buying a house, or building wealth so that you can adorn your pets with bling and foreign currency (Image credit Eldwick at Pixabay, 2015)