The Barefoot guide to happiness

There are three things that happy people have. Is more money one of them? Nope. Once your basic needs are met, extra money doesn't really make you happier. The three things are purpose, relationships and financial control, says author Scott Pape.

I've just finished his popular book The Barefoot Investor (2018 Update): The Only Money Guide You'll Ever Need. I expected mainly tips on saving, investing and the sharemarket. Those topics are covered, but a lot of his advice is
1. Don't buy so much stuff,
2. Buy the basic stuff not the flashy stuff, and
3. Don't get sucked in by advertising and salespeople.

He says millionaires drive average cars. People with flashy cars are generally not doing as well. ("All show and no dough")

Stop making the bankers rich

Credit cards don't help you get ahead or buy more. In fact they lock us in to a lifetime of debt and often people pay more in interest than they spend on the purchases. This mean our pay packet doesn't go as far because part of every pay goes to the credit card bill.

Buy a home not a property

Houses. Many people are trying to climb the property ladder - constantly trading up from one house to the next in search of the exclusive postcode. Instead of joy, all this brings is financial stress. They end up no happier than people in a standard house in an normal suburb.

Don't buy until it makes sense

Still on houses, he reckons we are over-obsessed with owning our own house. We're either scared that we have to buy now before prices go up, forced into it by social pressure, or worried that 'rent money is dead money'. He points out that paying interest on a mortgage is also dead money. So are the stamp duty, legal fees, rates and maintenance that come with purchasing a house.

He seems to advocate waiting until you find you place you want to live in "forever" and only to buy it if you can easily afford it.

More from Scott...

He also has something to say about health insurance and on how losing everything in a fire taught him about clutter.

Comments

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