Financial independence – it is the ultimate goal of why we are doing what we are doing day in, day out, yes? According to the author of the book by Wiley – John J. Vento, this is akin to getting to point X in a treasure hunt map. There are many ways to go around it, some are longer, some are shorter but we all still yearn to arrive at point X – often sooner rather than later. There might be bumps along the way for some, while for others, they would be stranded before ever reaching point X. What Vento had in this 300 pages book is an advisor guide to comprehensive wealth management.
This book started with some of the hard realities in today’s world – known as the New Norm (the new normal) after the most recent 2008 recession, debunking the myths below:
- The real estate market will always rise
- You can “live large” on credit and never pay any consequences
- Owning a home is always a good debt
- If you need to work, you can always find a job
We are in a perpetual state of change, financially and otherwise. What is more challenging is that our economy is also in a constant state of change. Becoming financially independent is not something that happens by change – it requires focus, discipline, determination, sacrifice and a lot of hard work. Setting one’s priorities based on what is most important only at this point of time is a bane to your future financial condition. He added that one of the most basic fundamental, as cliched it may sound – is to never satisfy your immediate wants instead of a future need. Time is by far the most valuable asset, but it is something we always take for granted and never appreciate until the later stages in life.
What I appreciate most from the book are some of the real stories he shared showcasing the stark realities and tragedies his clients faced as a result of complacency in managing the personal finance matters, especially when they are in their 30’s or 40’s. Because personal finance matters all inter-related, how you deal with one very often will have an effect on how you treat others. Not only these will impact one’s directly, but will also affect the next generation. For example, if you neglect to property insure yourself against sickness or premature death, your spouse and family could be wiped out.
The tales Vento shared and observed throughout his years are both heartwarming and heartbreaking. But one thing for sure, the same thing I felt myself, – that “…the most satisfying aspects of my work as Certified Financial Planner is that I have the opportunity to meet with some amazing people and become integral part of their lives. There is no more satisfying feeling than helping clients and their children achieve their financial goals and live out their dreams.”
And once one is at Point X, one of the most important things now is how to protect the assets you have worked so hard to accumulate. Clearly, if one does not protect your financial independence once you achieved it, it is almost as irresponsible as never taking the steps to achieve it in the first place. If reaching Point X coincides with retirement, ensure that the proper means to address post retirement concerns like medical cost are properly funded, hopefully by a comprehensive insurance coverage rather than hard cold cash. People coming to retirement are facing concerns that retirees did not face 2 or 3 decades ago, including living longer and supporting themselves throughout turbulent times.
The only part I’d skip are the topics regarding taxes because they would require a more localized approach. Other than that, this book is a good read – not because the concepts are new, but because the approach and perspective are fresh. I can relate to this because in my client engagement session, I too, shared stories of my older clients so that the younger clients can shortcut their way in getting to Point X. The true value an advisor brings to the table, besides the technical part, are real life cases he/she has seen so client could leverage on that to reduce roadbumps in achieving financial freedom.
Now, if you post a comment below on which part of this book review resonates with you, 2 readers will stand a chance to win 2 copies of the book (worth U$ 39.95), courtesy of Wiley Singapore.
Winners will be announced 28 June 2013
[Updated] Winners this round are Patrick and Lee Yun Kiew. Please send me your full name, addresses and phone# via Contact form above to claim your free book. Thanks!