Book Talk: The Simple Path to Wealth by J.L. Collins

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The Simple Path to Wealth by J.L. Collins shows up on almost every recommendation list for the personal finance blogs that I've read, so of course I had to check it out from the library. After finishing it, I can certainly see why it's recommended so much. It really does make the path to wealth seem simple: invest. That's it. The tone of the book is very chill and straightforward. The author explains everything clearly and gives you exactly what you need to know without being overwhelming.

It's not hard. Stop thinking about what your money can buy. Start thinking about what your money can earn. And then think about what the money it earns can earn. Once you begin to do this, you'll start to see that when you spend money, not only is that money gone forever, the money it might have earned is gone as well. And so on.

Do I feel like I understood everything perfectly? No. But I know exactly what wasn't fully clear, so I can look up more information about those topics. The way everything is explained never made me feel stupid for not quite getting it. It actually made me feel empowered and motivated to learn more on my own. This book is full of great information, plans of action, and quite the confidence boost. Investing isn't just for Wall Street types. Anyone can do it, with any amount of starting funds.

Thus the question is not "Should I invest in stocks now?" Rather it is "Should you invest in stocks at all?"
Until you can come to terms with the harsh facts above, the answer is no. Until you can be absolutely certain that you can watch your wealth get cut in half and still stay the course, the answer is no. Until you are comfortable with the risks that come with the rewards you seek, the answer is no.
In the end, only you can decide.

Investing still seems scary though. Logically, I understand that there is risk involved and that it will take time to see significant returns. Emotionally, it's scary to see money disappear when you aren't starting with much to being with! So I guess I'm not ready to invest yet, and I'm okay with that. I will get there. I'll start small by simply building up my personal savings. From there, as I build up more funds, I'll likely feel better about putting some aside to stocks and bonds. I can always add small amounts over time.

The Simple Path to Wealth is a book that I'll return to in the future for a refresher course when I'm ready to take my personal finance journey to the next level. It's also one that I whole-heartedly recommend if you want to learn about stocks, bonds, and index funds from the perspective of a regular person and not a stock broker.