Thursday, 17 October 2013

"The DIY Investor" - New Book Review

Well, my complimentary review copy of The DIY Investor - (How to take control of your investments and plan for a financially secure future) arrived this week. I spent a wet midweek afternoon curled up on the sofa digesting, cover to cover - its an easy read, well written, clearly laid out and presented and has an unpretentious style.

Author, Andy Bell is a DIY investment pioneer. He co-founded A J Bell in 1995 since when it has grown into one of the largest providers of low-cost investment and stockbroker services in the UK. Many DIY investors will already know who he is and may wish to benefit from his experience and expertise. Andy and his business have been recognized with a number of entrepreneurial and business awards over recent years, including winning the Ernst & Young Business Consumer Entrepreneur of the Year 2009.

Essentially, the target audience are aspiring new investors who are seeking ways to learn how to take control of their own investments. In the words of the author ‘it is aimed at people who want to invest for their future and then get on with the rest of their lives, not those who want to be part-time or full-time investors’.

Having said that, there is plenty of substance for the more experienced investor as well as practical guides - I particularly enjoyed the chapter on building a risk-adjusted portfolio.

The basic question to be answered by the reader is ‘Am I a DIY investor’?

The first part of the book looks at important areas such as setting investment objectives - short term, medium and longer term such as pension planning for example. It also covers ways to remove emotions from rational investing.

Part 2 looks at the products available to the diy investor to try to achieve those objectives e.g. ISAs, Dealing Account and SIPP - the latter in some detail with separate chapters covering what SIPPs can invest in and also taking benefits from a SIPP. Plenty of great content from an industry pioneering leader.

The next part of the book covers the various types of investments - funds, trackers and investment trusts as well as the importance of balancing equities with gilts, corporate bonds, gilts, cash and PIBS.

The final few chapters are called putting it all together - developing a good strategy, building a portfolio,  looking at risk, as well as various aspects of taxation such as capital gains, inheritance etc.

By the end of this book, the reader should know with some degree of certainty whether they are (or are not) a diy investor.

Many people would not undertake building their own house or repairing the car’s engine - they would pay a builder or garage mechanic. Yet when it comes to taking some of life’s most important financial decisions such as pensions or long-term investments, more and more people are opting to dispense with a financial adviser and go DIY. Armed with ‘The DIY Investor’, I am sure many more people could get along very well adopting a diy approach.

So, if you are thinking of starting out on the road to diy investing, or are already part-way along the road, I can heartily recommend this book and I have added it to my list of books and have included a link to Amazon for those who may want to 'Look Inside' (see tab above).

Leave a comment and let others know what you think of the book if you read it.

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