Millionaire Expat Book Review

This book is an absolute must-read! I truly believe it has fundamentally changed the financial outcomes for my family.

I discovered the Millionaire Expat by Andrew Hallam whilst researching how to invest while living in Dubai. The book was highly recommended by a fantastic Facebook group: SimplyFI which is a non-profit community of personal finance and investing enthusiasts, whose aim is to empower each other to achieve Financial Independence.

https://www.facebook.com/groups/SimplyFI/

http://simplyfi.org/

The book is targeted primarily at expatriates who are looking at how to achieve financial independence but I believe it is just as useful for anyone looking to secure their futures whether at home or abroad.

The basic concept proposed is that, over the long term, low cost investing in financial instruments which track the broader stock market will provide the best path to investment growth and returns. This book is not a get rich quick scheme and promotes very long term thinking.

The book lays out everything in very simple and understandable terms backed up with real data (and links to it). It provides very specific usable advice on brokers, investment products and does a good job of explaining the pros and cons of each, with options depending on your desired outcomes. I would recommend you purchase the kindle version as it is much easier to search and take notes… which you certainly will be doing.

The book took something which I always found to be scary and complicated and made it highly accessible. As a result, I opened my first investing account with Interactive Brokers in the UK and picked a very simple investing strategy that I have been following for the past 3 years.

The book is structured in a clear manner and explains how to make profits without tonnes of effort. It explains the concept behind exchange-traded funds (ETFs), index funds, and bonds, then describes how, using low-cost self investing, you can avoid having all your profits eroded away by brokers, advisers and the like.

“Look, those are the bankers’ and brokers’ yachts.”

“Where are the customers’ yachts?” asked the naïve visitor.

Fred Schwed, Where Are the Customers’ Yachts? Or, A Good Hard Look at Wall Street (New York: John Wiley & Sons, 1995),

Furthermore, it explains that by diversifying and rebalancing your portfolio you give yourself the highest chance for long term success. There are some interesting anecdotes about how women are typically better at this type of investing than men as they tend to be less impulsive and less likely to change strategy in a panic during a crisis or market crash.

What I particularly like about this investment scheme is that by investing in ETFs which track the global stock market balanced with bonds, you significantly de-risk your portfolio. For example, even when an ETF is denominated in a certain currency because the ETF is tracking global stocks (which themselves are multi-currency) you are effectively protected against currency risk due to a natural hedging effect. The ETF is following the performance of 1000’s of global companies, the likelihood that the entire global stock market dies is very remote and if it did happen, then our investments would be the least of the issues we would face.

In conclusion… get this book ASAP, the later your start your journey to financial independence the less time you will have to enjoy life.

Photo by Austin Distel on Unsplash