Andrew Hallam, the author of Millionaire Teacher, was kind enough to send me a copy of his latest book The Global Expatriate’s Guide To Investing last fall. I finished the book a few weeks ago but have been delinquent in completing my review and posting my favourite takeaways from this book, until now. If you’re an expat, an aspiring expat or you simply want to learn about index investing from this digital nomad you’ve found a good book.
Why follow Andrew Hallam’s advice?
I’ll let Andrew answer this question largely in his own words…
“In 2014, shortly after my 44th birthday, my wife and I retired from our Singapore-based teaching jobs. When you’re financially free, you might choose to keep working, take a long-term leave, or retire. Financial freedom provides options.”
“Expatitis isn’t a common medical term. Unlike bronchitis, arthritis, appendicitis, or colitis, expatitis is rather pleasant. Afflicted individuals get addicted to five-star holidays, manicures, pedicures, massages, expensive dining, and entertainment.”
Andrew Hallam was financially free (and a Canadian expat) before Millionaire Teacher was released thanks to his saving and investing proficiency in his 20s and 30s. He is now “living the life” as a digital nomad in Mexico, at least that’s the last email I got from him.
Takeaways from The Global Expatriate’s Guide To Investing
There’s a wealth of great information in Andrew’s latest book but here are some of my favourite takaways and investing reminders from it.
Andrew on safe withdrawal rates:
“…there’s nothing wrong with a 3 percent withdrawal rate. When it comes to money, caution is cool.”
On the truth about stocks and bonds:
“…stocks pound inflation…” and “…studies have shown that, on average, people who trade stocks (buying and selling them) don’t tend to make investment profits that are as high as those of investors who do very little (if any) trading. What’s more, to maximize profits, investors should reinvest dividends into new shares.”
“Patience, diversification, and low investment costs are keys to large profits in the stock and bond markets.”
“Bonds are like parachutes when stocks fall; they cushion portfolios when stock markets drop.”
On Couch Potato Investing and the stock market:
“The Couch Potato portfolio is effective for two reasons: It’s both diversified and cheap, costing as little as 0.1 percent per year.”
“It’s also an insult to Wall Street. Most hedge fund managers (known as the smart money to the gullible) underperformed the Couch Potato portfolio every year between 2002 and 2013.”
“Stock market drops are great for young people. But they’re nightmares for undiversified retirees.”
Chapter 16 – Canadian Expats Only?
Despite the title of the book, there’s more to Chapter 16 that just investing for Canadian expats. Andrew suggests the following Exchange Traded Funds (ETFs) are worth looking at for Canadian investors in general, among other products:
- iShares XIC
- Vanguard VUN
- Vanguard VEE
- Vanguard VDU
There are other chapters that focus on investing practices for British expats, Australian expats and the list goes on.
A recurring theme in Andrew’s latest book is worth leaving with you, whatever route you decide stick with your investment plan. Avoid tinkering with the portfolio and certainly avoid chasing the next big thing.
I would highly recommend this book for aspiring expats or for any investors that need some great, trusted advice on their financial journey.
“Whether you choose to repatriate, vagabond, or reside in a foreign oasis, your older self will thank you. After all, you’re a custodian for a senior. So do yourself a favor. Plan for your retirement.” – Andrew Hallam