Review: Set for Life

I loved Set for Life. The author is involved with the DeeperPockets website, the bible for real estate investors in the US. He’s also a great writer.

The thing I enjoyed the most about this book was the mindset. It’s similar to Mister Money Mustache in that it involves taking responsibility, being realistic, and working on things that you have control over.

The book is divided into a series of steps:

1. Cut your expenses and get control of your finances
2. Save up $25,000 (a year’s living expenses)
3. Improve your income
4. Save up $100,000
5. Start investing
6. Become financially independent

The book is very much written for a US audience (I suspect that one large part of step 3, house hacking, is unlikely to work in Japan, and real estate investing doesn’t seem as good here as it does in the US) but you can just skip over the bits that don’t work. The rest of it is universal.

I particularly liked The Seven Core Tenets of Investing:

• Tenet #1: Never spend the principal
• Tenet #2: Reinvest most investment returns
• Tenet #3: To invest, one must have capital
• Tenet #4: Effort correlates with return only if you are in control of the investment
• Tenet #5: Investment returns are impacted by knowledge
• Tenet #6: Do not confuse volatility with risk
• Tenet #7: The best investments are specific to the investor’s personal situation

Set for Life is very readable and best of all makes a lot of sense. I didn’t see anything that raised my hackles and wish I had read this book (or one like it) a long time ago.

Coincidentally, you can read another review of Set for Life on ESI, a site I’ve been enjoying recently.

How about you? Have you read Set for Life? What did you think? Any other recommendations?