Book Review: The Wealthy Barber Returns

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As you all know, The Wealthy Barber is one of my all time favourite personal finance books (and I believe one of the very first ones I have read), so you know that when David Chilton announced that he was writing another book, I was waiting with delirious anticipation to read his second book, The Wealthy Barber Returns.

It was through The Wealthy Barber that I learned that Paying Yourself First is the way to go (and it remains to be my most important financial piece of wisdom).

I really enjoyed the Wealthy Barber because of the humor, the easy reading, the story line and I'm happy to say that The Wealthy Barber Returns doesn't disappoint!  No story line in this one, but lots of humor.  I actually “laughed out loud” at a few pages and to be honest, I NEVER do that with a book, let alone a PF book.  Ten years later, he still looks the same as the original book (I did a side by side comparison of course) and has not significantly older as he claims in the title of his new book.

He wrote the book because he found that the rate of savings and the financial literacy of Canadians was pretty dismal and he's right.  In this book, he focuses mainly on his insights into saving, spending, and borrowing, and says that our current society is CONSUMED with consumption (I totally agree with this- material goods don't necessarily bring lasting happiness– I have yet to try and convince my boyfriend otherwise).

The way David writes reminds me of how I write (like its a conversation) except he writes a gazillion times better of course.

In the latter part of the book, he talks about some random thoughts on personal finance, and I liken this to the “nitty gritty”.  He talks about financial advisors, what common personal finance abbreviations mean, why its a good idea to be oblivious in the stock market, and he even mentions about some great personal finance blogs you should follow (namely the Canadian personal finance gurus Preet Banjeree and Squawk Fox). In one of my favourite chapters, he acknowledges that because of the multiple registered plans available (RESP, TFSA, RRSPs) it can be difficult to “choose just one”, so he elucidates (there, word of the day!) which one might be better for you, given your specific situation.

I really liked his chapter on TFSA vs RRSPs (and I have also asked this important question, of course) and he thinks the TFSA wins hands down.  You can read an excerpt of his book in the Toronto Star.  He does make a good point that with the RRSP, it can be very difficult to predict your income when you withdraw from it.  However, I am being optimistic and don't think that there will be a 40% tax rate when I withdraw my RRSPs, but who knows, I might be a very wealthy pensionable 65 year old!

Another chapter (titled “A Tough Call”) I really enjoyed was about whether or not to contribute to an RESP (or contribute to an RRSP).  Do you put your children first or your retirement first?  He suggested that you could recruit grandparents to help with RESP contributions and that approaching this subject with your parents might be difficult but he gave an easy tip:

Get some RESP brochures and say to your parents, “Here's the material you asked for.”  When they look confused, follow up with, “Oh sorry, that was the in-laws”.

Haha that is the best trick in the book ever, if you ask me!  Creating motiviational competition and guilt between inlaws is like getting two Christmas presents from your separated parents (Hey! My parents are separated so I can say that, don't hate me 😉 )

The coolest part of this book is that he actually gives his real number in the book and I am tempted to call it to see if it is really him.  Judging by his friendly, personable personality, I am taking a guess that it really is his phone number listed in the book.  Anyone want to test it and see?  When I emailed him (or so I thought his publisher) to ask for a review copy of his book, I was surprised that he replied back himself!

Readers, what are your thoughts on The Wealthy Barber Returns?  Have you tried calling his number?  Here's his website if you want to have a visit: The Wealthy Barber Returns.  You can also follow him on twitter: @wealthy_barber.

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Young is a writer and former owner of Young and Thrifty and the main "twitter' behind Young and Thrifty's twitter account. She lives in Vancouver, BC and enjoys long walks on the beach, spending time with her anxious dog, and finding good deals. If you like what you read, consider signing up for email updates.

16 Comments

  1. Liquid Independence on November 21, 2011 at 10:15 am

    Nice review. I was just about to do one as well. I like Mr. Chilton’s sense of humour, especially when he brings his family members into the picture, like closing his daughter’s RESP account. Found myself chuckling a few times throughout the book. And that chapter about how moot it is to try and beat the market is quite telling.



  2. SavingMentor on November 21, 2011 at 2:43 pm

    I haven’t read either one of his books yet but I do know they are highly regarded in the Canadian PF blogger community.

    I totally agree with him about TFSAs though – almost always superiour to RRSPs. I say delay putting money into your RRSP as long as possible unless you are completely maxed in your TFSA. Save all that RRSP contribution room for when you are in the highest possible tax bracket shortly before retirement.



  3. Taylor on November 22, 2011 at 7:39 am

    Good review. I saw this book at the store a few days ago but I thought it might be the original book with an extra updated chapter or two. But no, a new book! I’ll have to check it out. Thanks!



  4. Lina @ Baby Alerts on November 22, 2011 at 8:25 am

    This is the first personal finance book I read at about the age of 17. It also help set me up to a lifestyle of savings first rather than consumption. Great review. I have not read his second book however you have just convinced me to! Thanks.



  5. Dave chilton on November 22, 2011 at 4:06 pm

    Thanks for the kind words–much appreciated!
    Dave



  6. My Own Advisor on November 22, 2011 at 5:32 pm

    Good review Y&T! I’ve got my review ready to go for next week!

    @Dave Chilton, stay tuned!



  7. Bret @ Hope to Prosper on November 23, 2011 at 3:03 pm

    I loved The Wealthy Barber and I’m sure the new book is great as well. I need to pick this up for my holiday reading.



  8. Brian Poncelet,CFP on November 23, 2011 at 5:57 pm

    Dave Chilton really hit the nail on the head regarding paying yourself with his first book. However the rates of return he talked about never happened…I think on page 34 he was talking about returns of 15%!! Also having a lot of money in RRSPS only delays taxes in the future, with tax changes one like clawbacks (see age amount, and OAS) one could pay more taxes in retirement not less.

    The TFSA vs RRSP debate is correct…the TFSA wins! However in the first book I think Dave was against cash value insurance…yet this can work as well as the TFSA years before the TFSA was around.

    I don’t what his thoughts on insured annuities but using insurance to get 7 to 10% guaranteed returns sure seems to beat this market for people in their late 60’s or 70’s.

    Cheers,

    Brian



  9. young on November 23, 2011 at 7:29 pm

    @LI- Awesome, you read his book too? I love his sense of humor, and really enjoyed the family members aspect of it all. Haha, I wonder what his daughter and son thinks of all this? They must think he is so cool- I would love to have a dad like that 🙂



  10. young on November 23, 2011 at 7:31 pm

    @SM- You’re missing out!! It’s so good- I think you will like it 🙂 I’m totally going to max out my TFSA’s but the problem is I need to repay my RRSP because of the HBP. Once I finish my repayments, I’ll be maxing out my TFSA. I may just try to pay the minimum into my RRSP and then max out my TFSA next year. I still have some non-registered investments that I want to sell or transfer into my TFSA though. We’ll see. I have $2700 left for this year (or maybe more but I admit I lose track since I withdrew so much last year for my down payment).



  11. young on November 23, 2011 at 7:33 pm

    @Dave Chilton- Thanks for visiting!!!! It’s such an honor to have you visit my humble little blog! LOVE THE BOOK!!!!!!



  12. young on November 23, 2011 at 7:34 pm

    @My Own Advisor- Can’t wait to read it!! 🙂 I like how we have like a little ‘online PF blogger’ book club going on lol.



  13. young on November 23, 2011 at 7:48 pm

    @Bret- It’s great holiday reading very light hearted and easy to read. Makes you smile!



  14. young on November 23, 2011 at 7:51 pm

    @Brian- That’s true, but at the time, RRSPs were the only thing available. LOL better than nothing right? Now we have TFSAs and this has opened up HUGE opportunities for savings.



  15. Brian Poncelet,CFP on November 24, 2011 at 3:54 am

    Young,

    I agree RRSPs were the only game in town at that time, most people were aware of. People like myself were told 12% rates of return and buy term and invest the difference, this the way to go…but forgot about taxes. But the insurance as a retirement tool for many was/still over looked. I wrote a story about annuities you may want to review

    www.milliondollarjourney.com/how-a…s-work.htm

    The end part…retirement how can we spend and enjoy our money have better protection and pay less taxes is an important one.

    David’s basic idea of saving in the end, is still not done in many households for many reasons, some valid others not so much.

    cheers,

    Brian



  16. young on November 27, 2011 at 8:23 am

    @Brian- Thanks Brian! I read the post you had on MDJ and found it really helpful.



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