Thankfully, bookstores are brimming with financial advice this time of year. Globe Investor plucked eight tomes off the shelves -- a small sample of what's out there -- and today serves up a batch of mini-reviews to get your book shopping started.
There's something here for everyone, whether you're a student opening your first registered retirement savings plan -- Is that really such a good idea? Read on -- or a more experienced investor struggling to make sense of hedge funds or the pension system.
Investing books are enjoying a resurgence after a couple of years of weak sales, mirroring the rebound in the stock market, says Robert Harris, a general manager at John Wiley & Sons Canada Ltd.
"People tend to buy personal finance books when the market is hot," he says. When stocks are falling and nest eggs are getting crushed, "they just don't want to deal with the problem."
Titles are also becoming more specialized, reflecting the increased sophistication of investors. In October, for instance, Wiley plans to publish a book on income trusts, one of the hottest sectors for yield-starved investors.
Niche books are "a lot riskier for us because you're looking at smaller print runs. Any time you start segmenting a market like that it's not as profitable," he says. But investors are demanding specialized information.
They're also buying books earlier. January to March remains the busiest season, generating about 60 per cent of sales, but the fall has become a popular time to launch titles aimed at the growing number of investors who get the jump on RRSP season.
That trend was especially pronounced this year, as retailers began placing orders earlier than usual in anticipation of a strong season, said Claudia Hawkins, senior marketing manager at McGraw-Hill Ryerson Ltd.
What books do especially well? With investors still nursing wounds inflicted by the three-year bear market, titles that stress safe investing are popular, she says.
But there's nothing like death and taxes to bring in readers.
"The Canadian Guide to Will & Estate Planning is actually our best-selling Canadian title."
Smoke and Mirrors:
Financial Myths That Will Ruin
Your Retirement Dreams
By David Trahair
Self-Counsel Press, $16.95
Don't invest in RRSPs? Isn't that like advising someone not to eat vegetables? Chartered accountant David Trahair throws cold water on the conventional wisdom espoused by the investment industry -- including the notion that investors should contribute early and often to a registered retirement savings plan, even if they have to borrow the funds. Bollocks, the author says. RRSPs aren't right for everyone -- especially not folks saddled with a mortgage, car loans and credit card debt. It's more prudent to pay off loans first -- and lock in the guaranteed savings from wiping out interest payments -- than to gamble on investments that fluctuate from year to year. He also challenges the rule of thumb that retirees need at least 70 per cent of their previous income to live comfortably. By controlling expenses and paying off debt, retirees can live happily on just 40 per cent of what they earned before, he argues. -- John Heinzl
The Pension Puzzle
Your Complete Guide
to Government Benefits, RRSPs
and Employer Plans
By Bruce Cohen and Brian Fitzgerald
John Wiley & Sons Canada Ltd., $26.99
Planning for retirement is often like solving a puzzle. The Pension Puzzle offers to help readers fit the pieces together. Part of this book deals with the fundamentals of retirement funding and how Canada's retirement savings system works. Another part is aimed at providing information to those with employer-sponsored registered pension plans. There's no one magic answer that fits everyone. But the book will help Canadians make sound decisions about their pension plan and how it affects their financial future at any stage of their lives. It also includes some helpful forms and worksheets that allow readers to figure out how much income they will need in retirement, and how much government benefits and employer plans will provide them. They can also figure out how much they will need to sock away in RRSPs to supplement those other plans.
-- Showwei Chu
The Automatic Millionaire
A Powerful One-Step Plan
to Live and Finish Rich
By David Bach
Doubleday Canada, $29.95
Let's cut to the chase here. What's the real secret to getting rich? Financial planner David Bach says you can't get rich by trying to stick with a budget. You don't need to make a lot of money. You don't even need willpower. Rather, you need to have a plan that will automatically pay yourself first. A plan that, he says, you can set up in an hour. Start by cutting out the double latte and muffin, settle for a regular coffee and you've saved yourself as much as $5 a day. Put that $5 a day into a retirement plan at age 23, assume a 10-per-cent return, which the stock market has averaged over the past 50 years, and by the time you're 65 you'll have almost $1.2-million. The good news is that saving small amounts of money by giving up frivolous habits -- what Mr. Bach calls the latte factor -- can make you rich, if you do it on a systematic basis. This book should prove particularly useful for young people who need to get started on a savings program. -- Dave Pyette
The Hedge Fund Lady,
A Practical Guide to Hedge Funds
By Renata Neufeld
Doubletree Press, $18.95
The hedge fund industry is just hopeless at explaining the many virtues of its products to investors in comprehensible terms, so this self-published book is especially welcome. In simple but not simplistic fashion, it lays out pretty much everything a prospective hedge fund investor needs to know. Ms. Neufeld, a former financial adviser, makes a strong case for hedge funds. She notes their potential to deliver returns in both up and down markets, and she explains how they differ from mutual funds in that they seek not to beat a benchmark index but instead to deliver "absolute returns." That term, as Ms. Neufeld explains, means that hedge funds try never to lose money and to deliver returns higher than zero. If this interests you, Ms. Neufeld's book is the place to start your research.
-- Rob Carrick
The Five Rules for Successful
Stock Investing:
Morningstar's Guide to Building Wealth and Winning in the Market
By Pat Dorsey
John Wiley & Sons, $35.99
Don't be put off by the lengthy title. This is a very approachable and easy-to-understand investment guide by Pat Dorsey, Morningstar's director of stock analysis, for people interested in finding good businesses to invest in at reasonable prices. The author, who belongs to the Warren Buffett school of investing, says the five principles investors should adhere to are doing your homework, finding companies with strong competitive advantages, having a margin of safety, holding for the long term and knowing when to sell. There are several chapters devoted to the understanding of financial statements, since they are the foundation for analyzing companies. This is all part of the rigorous process Mr. Dorsey goes through when evaluating stocks, which ought to help readers in their own stock selection. Needless to say the amount of investing success will depend largely on how readers apply the advice. -- Showwei Chu
Money 201
More Personal Finance Advice
for Every Canadian
By Ellen Roseman
Wiley, $26.99
Money 201 is finance writer Ellen Roseman's follow-up to her highly successful crash course in financial matters, Money 101. In the most recent guide, Ms. Roseman offers in-depth advice on getting a handle on expenses, saving inside and outside of a registered retirement savings plan, investing in tough times and planning care for elderly relatives. Ms. Roseman's cost-cutting advice includes tips on shopping for the best value in car insurance, lowering bank fees, and the pros and cons of taking on a tenant to help pay the mortgage. Once readers have put aside some extra cash, she offers advice on lowering debt, minimizing taxes, and investing in newer products such as exchange-traded funds and hedge funds. Ms. Roseman has long worked as an advocate for consumers through her columns in The Globe and Mail and Toronto Star. Readers will find the advice in this book is timely, well-written and easy to put into practice. -- Carolyn Leitch
Global Profit and Global Justice
Using Your Money
to Change the World
By Deb Abbey
New Society Publishers, $23.95
For left-leaning readers who have difficulty reconciling their personal belief systems with the calculating world of capitalist finance and the markets, this book attempts to show that investing and social/environmental activism needn't be mutually exclusive. Deb Abbey, president and CEO of Real Asset Investment Management, a Vancouver-based mutual fund company specializing in socially responsible investing, doesn't break much new ground here -- nor does she and her various contributing writers present a concrete strategy for generating solid investment returns while sticking to your idealistic guns. However, the book does serve as a reasonably comprehensive introduction to the ways investors can, and have, put their money to work to help advance a moral agenda in the corporate world. Profits aren't the bottom line for this book, nor should they be; the message is that money needn't be the root of all evil, but can serve as the root for doing good. -- David Parkinson
Resources Rock
How to Invest in and Profit
from the Next Global Boom
in Natural Resources
By Malvin Spooner
with Pamela Clarke
Insomniac Press, $29.95
Could a book such as this be the sign of a market top in the resources sector? No way, according to fund manager Malvin Spooner. On the contrary, the president and chief executive officer of Mavrix Funds suggests that this year is an ideal time to invest in the sector, as North American and European economies are about to rebound and emerging economies such as China and India are consuming resources at ravenous rates to feed their growing industries. Mr. Spooner -- an investment maverick whose rock band The Dealers is one of the hottest on the Street -- and co-writer Pamela Clarke provide advice on how to invest, when to buy and when to sell, as well as how investors can get tax breaks in the sector. Rock on! -- Dave Pyette
John Heinzl