If you landed on this page and were looking for full book reviews, I apologize. I tried to highlight some of the key highlights from each of the books, but without giving away too much detail. So, the descriptions below do not quite amount to full book reviews.
Financial Planning
INCOME STRATEGIES
by WILLIAM REICHENSTEIN
Warning: This book is terse. Highlights some strategies, but not enough detail to implement. Pumps his software (expected). There are some good nuggets around bunching deductible payments + other items.
SOCIAL SECURITY STRATEGIES
by WILLIAM REICHENSTEIN & WILLIAM MEYER
Warning: This book is terse, albeit not as bad as INCOME STRATEGIES. Very good and comprehensive overview of the Social Security system. It highlights the history, logic, and many relevant factors for those who have SS benefits.
A RICHER RETIREMENT
by BILL BENGEN
I just read his new book, and I would say there are three primary takeaways. The first is revising his safe withdrawal rate up from 4.0% to 4.7%. To be sure, that means a retiree would be able to withdraw 4.7% of his initial portfolio in the first year, and then withdraw that same dollar amount, but adjusted for inflation, through a 30-year retirement horizon. The key driver of this upward revision was the use of a portfolio where the equity allocation was diversified beyond just using the S&P 500 index portfolio.
The second takeaway was his highlighting the relevance and impact of market valuations on withdrawal rates. In particular, stock markets are currently sitting at elevated valuations, and this does not bode well for higher withdrawal rates.
The third takeaway was his emphasis on inflation. His prior books and studies highlighted inflation as a negative factor. However, he went further in this book as he suggested that sustained higher inflation was actually more dangerous than bear markets.
Conserving Client Portfolios During Retirement
by BILL BENGEN
This is a wonderful book that is intuitive enough for the average reader who might be interested in reading this book. Bengen walks through and then updates his original 1994 research on withdrawal rates.
He presents his framework in a very intuitive way. Then he proceeds to slice and dice the data in different ways, but always providing clean explanations that add to the overall intuition.
portfolio.
The second takeaway was his highlighting the relevance and impact of market valuations on withdrawal rates. In particular, stock markets are currently sitting at elevated valuations, and this does not bode well for higher withdrawal rates.
The third takeaway was his emphasis on inflation. His prior books and studies highlighted inflation as a negative factor. However, he went further in this book as he suggested that sustained higher inflation was actually more dangerous than bear markets.
THE TAX TIME BOMB IN YOUR RETIREMENT
by JOSH SCANLEN
This is a good book that highlights multiple real-world examples of how our complicated tax code can bite. It should be thought-provoking for the average reader. However, I suspect DIY types may feel the book is lacking in terms of the specificity around solutions. It certainly left me feeling like all roads lead to Roth conversions.
RETIREMENT INCOME
by MARK WARSHAWSKY
This is a great book, but only for professional readers. The guts of this book are very technical. While he lays out definitions and explanations (including some great historical background about retirement plans with defined benefits, defined contributions, annuities, etc.), the terminology will be difficult for someone who is not already fluent in annuity jargon.
I particular appreciate the simulations he runs to compare methods of integrating annuities with portfolio-based strategies. I think there are significant issues with the core simulation engine (Monte Carlo simulations based on a vector auto-regression model), and wish he had used historical simulations like William Bengen did within his research (i.e., true historical performance of stocks and bonds versus hypothetical simulations).
by BRUCE LARSEN
This book, albeit slightly more technical, was good overall. It was filled with insightful examples of middle-class retirees reducing their taxes.
Like Scanlen’s book, the examples were pre-wired with the solutions, but did not take the time to explain how they arrived at those solutions.
THE NEW RETIREMENT SAVINGS TIME BOMB
by ED SLOTT
I liked the book, but it reads more like a political news channel geared to get you riled up about taxes. Ed’s energy (if you’ve ever heard him speak) leaps out from the pages as if he were right there giving you a pep talk about Roth conversions and life insurance – two key solutions he regularly highlights.
I found the tone a bit too much, and I think the book could have been 75% smaller without missing any major messages.
TAX-FREE RETIREMENT
by PATRICK KELLY
There are a lot of good reviews of this book, but I want my time back. As a financial planner, I came away feeling this book was basically a hammer (life insurance) in search of nails (customers).
I don’t like to write negative reviews. So, I am just going to stop myself here. Feel free to reach out to me directly if you would like more information.
MIKE PIPER’S 100 PAGES OR SERIES
by MIKE PIPER
Mike Piper is a gifted writer who writes about financial planning issues, often with a tax focus. This is not surprising, given that he is a CPA.
He has written almost 20 easy-to-read books on various topics, and I recommend reading any one of them that is relevant to you. You can click here to see a list of his books on Amazon.
SAFETY-FIRST PLANNING
by WADE PFAU
Wade writes clearly and goes deep into the weeds on various topics. His writing occasionally slips into the more technical areas of probability and present value of money.
There is some background touching on the concept of pooling risk with life insurance and annuities. This sets the stage for the central theme of the book which primarily focuses on the positive impact annuities can have on retirement outcomes.
RETIREMENT PLANNING GUIDEBOOK
by WADE PFAU
This book is an excellent book that touches on many aspects of financial planning around retirement. It reinforced many of the notions I had about broader planning, but also filled in a few knowledge gaps around areas on the fringe of my expertise (e.g., Medicare). I find it helpful to keep it near my desk as a resource.
RETIRE SECURE FOR PROFESSORS & TIAA PARTICIPANTS
by JAMES LANGE
Jim Lange is another great resource for financial planning topics. However, I find he often stops short of providing enough explanation to help others implement the strategies he highlights. This book was no different. Note: I understand he generates leads through his books and other media to sell to (or revenue share with) another investment firm.
This would have been a good book if it weren’t so repetitive of his previous works. In particular, my biggest gripe is that I specifically purchased and read this book because I wanted to learn more about the TIAA plans and the challenges TIAA plan participants face. However, that was a short and very superficial chapter.
THE AFFLUENT INVESTOR
by PHIL DEMUTH
Good and lighthearted overview of notions and strategies that can be helpful to those with significant assets. If anything, my main complaint is that it was not as structured or comprehensive as I hoped. It would be fine as additional reading, but certainly not a guide or reference book.
THE PSYCHOLOGY OF MONEY
by MORGAN HOUSEL
There is a good reason this book is so highly rated on Amazon. Morgan Housel is another gifted writer who managed to make reading about the behavioral side of finance enjoyable for a more technical nerd like myself.
DIE WITH ZERO
by BILL PERKINS
The title is a strong hint, but the basic idea is to enjoy your wealth while you are alive. He shares various anecdotes to make his points, but keeps coming back to the central theme of spending money on things that create memories and positively impact others. By doing this while you are alive, you will be able to participate in or observe the benefits.
I think he may have gone overboard with the way he quantified and modeled various notions. I appreciated the analytical angles and grinned at some of labels he came up with, but I am not sure everyone will.
Just to be sure, I think his views are very sensible, and I regularly refer to his book when speaking with clients.
THE ELEPHANT IN THE ROOM
by ED BAKER
Someone recommended this book to me a while back, and I am glad I read it. However, I could not truly relate to it, as I think it is more relevant to those with messy finances.
It is basically a fictional tale about taking control of your finances and adopting a sensible, disciplined approach to achieve financial freedom.
Investment-Related
THE BOGLE EFFECT
by ERIC BALCHUNAS
This is a great book that describes Jack Bogle’s pursuit of a radical idea of just settling for market-like returns, and offering them via a mutual ownership structure that naturally gravitated toward lower fees.
Competing against Wall Street’s active managers who claimed it would be “unAmerican” to settle for average returns, Bogle eventually triumphed and made Vanguard what it is today.
WARREN BUFFETT
By ROGER LOWENSTEIN
I had my nose buried so deeply in this book that I missed my stop on London’s Circle Line (twice!) and just decided to go around for another orbit. It really was that good.
This was a great book that starts with Buffett’s childhood, highlights that his father was a stockbroker, and then how he was absorbed with the idea of value investing after learning from Benjamin Graham.
It goes into his struggles in taking over Berkshire Hathaway, but eventually turning it into an investment vehicle that allowed him to successfully implement his value investment philosophy.
The book also touches on many aspects of Buffett’s personal life and (practical, if not frugal) lifestyle.
WHEN GENIUS FAILED
By ROGER LOWENSTEIN
Still high on the Buffett autobiography, I decided to read another book by Roger Lowenstein. I was not disappointed.
This book details how a team of academic economists built mathematical models to try and profit from various opportunities they viewed as market efficiencies.
Their resumes and mandate attracted hundreds of millions of dollars to their hedge fund. These monies were eventually leveraged into billions.
As the title of the book indicates, their venture ultimately failed and in spectacular fashion. Given the size of their positions and dealing with most of the big Wall Street banks, the Federal Reserve got involved and orchestrated a bailout by parceling out the hedge fund’s positions.
THE BIG SECRET FOR THE SMALL INVESTOR
by JOEL GREENBLATT
This is a short and sweet book that highlights a simple model to target above-market returns. The model combines two relatively simple factors: valuation and quality. It explains how they calculate these two figures, as well as the simple intuition behind them.
It is worth noting that Joel Greenblatt is one of the most successful professional investors of our time, but you probably have never heard of him. Indeed, his private hedge fund achieved returns that were significantly higher than Warren Buffett’s returns.
VALUE INVESTING
by BRUCE GREENWALD
This is a great book on value investing. It highlights various competitive edges that give rise to higher returns on capital (RoC) and walks through examples along the way. In particular, I remember the WD-40 case study and found it illuminating.
THE FIVE RULES OF SUCCESSFUL STOCK INVESTING
by PAT DORSEY
This is a great book on value investing. It highlights various competitive edges that give rise to higher returns on capital (RoC) and walks through examples along the way. In particular, I remember the WD-40 case study and found it illuminating.
F WALL STREET
by JOE PONZIO
This is a great book on value investing. It highlights various competitive edges that give rise to higher returns on capital (RoC) and walks through examples along the way. In particular, I remember the WD-40 case study and found it illuminating.
FOOLING SOME OF THE PEOPLE ALL OF THE TIME
by DAVID EINHORN
The author (a hedge fund manager) walks you through his experience after identifying a company with fraudulent accounting practices. While he was ultimately vindicated, the company he was shorting (speculating that its price would go down) brought in government regulators to question Einhorn’s ethics and trading practices.
This story will not grow your confidence in our securities regulators.
Biographies
A MAN FOR ALL MARKETS
by ED THORPE
This is probably my favorite book of all time. I highly recommend listening to the audio book, as Ed Thorpe’s voice narrating his own autobiography adds to the experience.
He starts with his family background and describes how his childhood was full of tinkering. There are some notable highlights from his high school and college days, but I thought the best part was about his efforts devoted to beating roulette and blackjack.
He also went on to describe his hedge fund activities, which coincidentally rhymed with my experience on Wall Street (equity derivatives and long/short equity).
There is also a good overview of how he met Warren Buffett and their relationship/friendship.
THE MAN WHO BEAT MARKETS
by JAMES SIMONS
Of course, I am going to like this book; it is about another math PhD. While that is true, his determination and achievements are on another level. How else could his flagship funds charge fees that were over 5% of assets managed and also take more than half of the profits, too?
Well, that is exactly what James Simons’ Medallion hedge funds did, and he was still able to deliver net returns in excess of 20% to his investors.
JULIAN ROBERTSON
by DANIEL STRACHMAN
Julian Robertson ran one of the most successful and well-known hedge funds, called Tiger Management, until its eventual closure in 2000. His hardcore, fundamental focus ran into the irrational markets of the late 1990s.
Even after his fund shut down, Robetson became famous for so many of his analysts going on to start their own hedge funds. They become known as his tiger cubs.
While this book covers some of Robertson’s personal life, its primary focus is on his hedge fund and the strategies they employed. For example, there is an interesting instance of their due diligence where an analyst discovered a mechanical defect in a car built by a Korean manufacturer. Wanting to be confident that this was actually the case before shorting the stock, Robertson and the analyst purchased two of the cars. After having them inspected by a mechanic and confirming the defect, they placed the trade.
NO BULL: MY LIFE IN AND OUT OF MARKETS
by MICHAEL STEINHARDT
Michael Steinhardt was also a legendary hedge fund manager, but his style leaned more toward aggressive trading and contrarian macro bets, rather than the deep fundamental, on-the-ground research that Robertson’s Tiger was famous for.
MY LIFE AS A QUANT
by EMANUEL DERMAN
This autobiography focuses on Emanuel Derman’s career. His academic roots were in theoretical physics, and he made his way to AT&T’s prestigious Bell Labs. However, the bulk of the book focuses on his transition to and his time spent on Wall Street. In particular, Derman first worked at Salomon Brothers, but eventually spent the rest of his career at Goldman Sachs.
While this is primarily a niche book that is likely only read by (ex)quants (i.e., quantitative analysts) like myself, he provides an intriguing firsthand look at the quant profession going back to the 1990s.
While he touches on some of the sophisticated mathematical and scientific models he applied to financial markets, he also highlights an important notion: models are not perfect. This part of his book reminds me of the quote from the British statistician George E. P. Box, “All models are wrong, but some are useful.”
FROM THE GUT
by JACK WELCH
Self-aggrandizing autobiography that walks through the many milestones Jack Welch achieved at GE. My favorite part was when he effectively admitted to a culture of earnings manipulation as far back as 1994. In particular, GE acquired a trading firm (Kidder Peabody) where a rogue trader (Joseph Jett) was eventually caught faking 100s of millions of dollars of profits. Welch proudly described how his lieutenants, who ran other divisions, offered to come up with extra profits to hide the loss.
Other
THE NEXT 100 YEARS
by GEORGE FRIEDMAN
George Friedman is known as a futurist and is an astute observer of larger geopolitical trends around the globe.
This book, first published in 2009, was absolutely prescient on multiple geopolitical trends and events. For example, he specifically forecasted that Russia would eventually pursue more presence in Crimea.
Even if he is not right on everything, he has been so spot on with some forecasts that I figure it is worth reading about his views and observations.
THINKING FAST AND SLOW
by DANIEL KAHNEMAN
The author is a Nobel Prize winner (economics) and explains how our brains have two gears. The first one reacts quickly, is instinctive, and is based on quick intuition and emotion. The other reacts more slowly while processing deeper logic.
PREDICTABLY IRRATIONAL
by DAN ARIELY
The author highlights factors that operate somewhere in our brains and lead to many irrational decisions. He highlights many examples, many of which could be applied to marketing and sales tactics.