The Wealthy Barber, Updated 3rd Edition: Everyone's Commonsense Guide to Becoming Financially Independent

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The Wealthy Barber] is a complete success in terms of being clear, easy-to-read, and interesting.” — Chicago Sun-Times

The book is structured around a story of three people in their late 20s visiting Roy, the title character, for lessons in financial planning. Each chapter of the book describes a different visit and a different element of financial planning. Each month along with their lessons the three students are required to start carrying out the actions prescribed by Roy. In addition to these individuals, Roy also shares his financial knowledge with the customers of his barber shop. I like to think I'm a halfway intelligent human being, but an understanding of the financial world has evaded me for longer than I would have liked. I cringe at government paperwork, nod and agree with suggestions at bank meetings, and hand over bank statements to my more money-savvy wife. My brother, an accountant, has tried to break down some key facts for me, but it's always come out as too jargon-filled or has made it seem like excessive effort would be required. The eldritch and arcane world of finance just didn't seem like anything I'd ever master. Roy (and thus Chilton) is not as harshly anti-debt as some other authors, like Dave Ramsey. However Roy does advise that extra money should go to pay off debt, and that credit cards are " anathema" to well-run personal finances. Roy does believe that if you are investing 10% and maxing out your RRSP, day-to-day spending doesn't matter too much to your overall financial picture.Roy tells them his story of becoming wealthy and he says an old man once told him to "Invest ten percent of all you make for long term growth." Roy goes on to tell them that if they saved 30 dollars a month from age 18 to age 65 at 15% annual return, they would end up with 2 million dollars. Dave is an expecting father who realizes he is not financially prepared. His worries lead him to seek financial advice from the local barber. The Wealthy Barber is the best book of its type that I have ever read. In fact, for many Americans, it is possibly the only book they need. I wish I had written it.” —Jerry Mason, director of Education, Interanational Association of Financial Planners The basis of the book is Roy's advice to "save 10 per cent of all that you earn and invest it for long-term growth." In that, it draws from the advice first set forth in The Richest Man in Babylon. Subsequent chapters discuss wills and life insurance, RRSPs, buying a home, income tax and saving and spending. Here's the set-up: 3 twenty-somethings go to a barber for financial advice. They go eight times (there are each time is a chapter), and have seven lessons with the Wealthy Barber, Ron, who gives them financial advice.

Thirty years from now, Chilton could be remembered not as a bestselling author, but as the man who inspired thousands to save their way to prosperity.” —Brenda Dalglish, Maclean’s News Magazine Chilton has probably motivated more people to take actual control of their personal financial lives than any other speaker or writer has in this decade.” — Your Money That's right. He later describes home ownership (and paying a mortgage) as "the ultimate forced-savings program", and talks more about mortgages, but I appreciated that he wasn't like: "Buy, buy, buy!" Overall, The Wealthy Barber is lauded for its straightforward, jargon-free language and ability to break down financial subjects without talking over its audiences’ head, while also not talking down to them. The book’s novelistic form provides just enough character development, plot, and dialogue to keep things moving while not distracting from its primary purpose: Dispensing financial advice. Unlike many other popular personal finance books, The Wealthy Barber takes the form of a novel. The basic plot centers around Dave, who’s an expecting father who realizes he doesn’t feel financially prepared, his sister Cathy, who has a successful business but doesn’t know a lot about investing, and their friend Tom. All of them are in their late 20s to early 30s, and they periodically go to visit a barber in Sarnia, Ontario, who they’ve heard has become quite wealthy. The three friends wonder how this man, named Roy, has gotten so wealthy on a barber’s salary, and end up visiting him frequently as he dishes out financial advice while cutting hair.The main idea is to accept that one cannot have everything and avoid impulse buying by removing temptations which trigger overspending. This may be achieved through analysis and modification of one's personal behaviour (if you overspend on clothes, stop going to the mall and reading fashion blogs), and avoiding bad debt in the form of credit cards which carry very high interest charges, though some debt may be necessary (mortgages for example). Ultimately, wealth depends more on savings than income. Chilton's bottom line, which is emphasized in his first book as well, is that we should all save 10-15% of our earnings. This is a book for absolute beginners—newbies who are just now starting to think about their financial journeys and are unsure where to start or how to feel about certain subjects will surely appreciate the book’s hand-holding approach. Other readers who might already be further along in their journey or are looking for investment advice that goes beyond “low-risk, long-term mutual funds” may get frustrated by the book. Anyone looking for more specialised advice on how to trade commodities or more in-depth financial perspectives won’t find them in this book.