A discussion I had with the Physician on FIRE at a recent meeting prompted me to think about some of the mentors I’ve had in the financial world. These are people whose thinking and writing have really affected the way I manage my finances and business. The more I thought about this list of people, the more I realized I have written posts criticizing some aspect of their work at one point or another! So, no criticism today, just some appreciation and a list of lessons learned.

My Appreciation For These Financial Mentors

William Bernstein, MD

At my first Bogleheads conference in 2008, I confessed that I was more of a Bernsteinhead than a Boglehead, which was good, since Bill made that meeting and Jack only attended virtually from the hospital. While what Bogle built (i.e. Vanguard and the popularity of index funds) has had a profound influence on me, his actual writing didn’t. I’ve read a handful of his books now and met him in person, but that was all relatively late in my financial education. I think I’ve read just about everything Bernstein has published, and I read it early on. The Four Pillars of Investing was life-changing. The physician connection was probably part of it, but mostly I could just relate to the method of writing and logic behind his arguments. I’m sure many of you feel the same way. I’m also grateful to Bill for the help he has so generously given to me personally over the years, including writing the foreword for my book!

Lessons learned:

  1. An understanding of market history is critical
  2. The financial services industry does not share your financial goals
  3. It’s okay to be an asset class junkie

William T. Spitz

Pfeifferhorn ascent

A spring ascent of the Pfeifferhorn

This may be the only guy on this list you’ve never heard of, but his book was the first one I’d ever read that talked about building a portfolio composed of a static asset allocation of low-cost index funds, rebalanced periodically. The book, entitled Get Rich Slowly, is essentially the method I advocate for the vast majority of doctors to become wealthy- Invest early and often into a simple, low-cost, diversified portfolio and after a couple of decades, you’ll be rich. While there are plenty of books on the market now advocating this method, there were precious few in 1996 when the book was published. Even Bogle’s famous “Common Sense on Mutual Funds” wasn’t published until 1999. I didn’t find the book until 2004, however, when it was sitting on a shelf in a used bookstore in Tucson, AZ with dozens of crappy books. I read those crappy ones so you don’t have to, but after digging through that pile of manure, I found this gem. Thank you!

Lessons learned:

  1. Use a static asset allocation
  2. Use index funds
  3. Steadily and intelligently investing a portion of your income is an almost sure, even if slow, path to wealth.

Rick Ferri

Several of Rick’s books along with his forum contributions also had a big influence on me and his thoughts on asset allocation had a heavy influence on my portfolio. All About Asset Allocation is a classic. It’s a better book than Spitz’s, but it was published 12 years later. I once asked Rick why he kept repeating the same thing over and over again (use index funds, use index funds, use index funds.) He said this:

The truth about index investing must be told over and over again because lies are constantly being told around it. Many of those telling lies are financial advisors whose income depends on their client’s use of high-cost active management strategies.  They view simple, low-cost passive strategies through index funds as bad for their business.

Bogle might have started the first retail index fund, but at least in the last 20 years, I can’t think of anyone who has done more to get that information into the hands of the masses than Rick Ferri. Thanks, Rick!

Lessons learned:

  1. The benefits of REITs in a portfolio
  2. The benefits of taking some risk on the bond side of the portfolio
  3. The merits of a total stock market approach

Larry Swedroe

Like many Bogleheads, I was bummed to see Larry retire from posting on the Bogleheads board a few months ago. His writing has had a big influence on the portfolios of many. Thanks, Larry!

Lessons learned:

  1. The merits of taking risk on the equity side (combined with a very safe fixed income portfolio)
  2. Factor investing. I know of no bigger proponent to the masses of DFA-style investing.

Mr. Money Mustache

Pete started his blog just a month before I started mine, although I didn’t spend any time on it until later. He has been dramatically more successful than I have. Part of that is that he is fishing in a bigger pond (there aren’t that many high-income professionals), part of it is his writing talent, but most of it is the somewhat revolutionary nature of his message in the personal finance blogosphere. The message is timeless (see the Stoics and Thoreau for instance) but the application to modern life is refreshing. Like him or hate him, he’ll challenge your thinking. I agree with the vast majority of his philosophy, although I’m not sure that came across as well as I had hoped in this column I wrote about him a couple of years ago. No criticism today though. Thank you, Pete!

Lessons learned:

  1. You can live quite happily on dramatically less than the average American household earns
  2. Saving a huge percentage of your income for just a few years can lead to rapid financial independence
  3. A bicycle is a money-printing fountain of youth
  4. How you spend your time and money affects not just your personal finances, but also your health and the health of the world
  5. Hyper-specialization might maximize economic productivity, but it comes at a cost- the loss of self-sufficiency

Wade Pfau

Here’s another one whose work has drawn a few polite criticisms from me in the past. Wade is soft-spoken but has had a dramatic effect on the ways people plan to spend their money in retirement. Thank you, Wade!

Lessons learned:

  1. Sequence of returns risk is one of the major risks in your financial life
  2. Everyone needs a plan to deal with sequence of returns risk
  3. There is really no such thing as a “Safe” withdrawal rate
  4. Guaranteed income in retirement has value, even if it means a lower expected future value of the portfolio
  5. Uses of SPIAs and longevity insurance in retirement
  6. Uses of a reverse mortgage in retirement
  7. Uses of cash value life insurance in retirement (if you happen to have been suckered into buying it years ago!)

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David Phelps, DDS

This one may come as a surprise to a lot of people, given my recent post criticizing an email David sent out a while back. I’ve never met David and never listened to him speak in person. My interactions with him consist of just a few emails, reading some of his marketing emails, and watching some very short videos. Yet he has still had a influence on me. Thanks David!

Lessons learned:

  1. If you can’t wait to get rich slowly, entrepreneurship, hard work, and leverage may be the answer. Yes, there is additional risk there. But you only get one life.
  2. Learn from those who have been there and done that
  3. Leveraged real estate can produce great wealth, very quickly
  4. Unchain yourself from “the chair” (think dentist) by maximizing your practice’s earnings and developing alternate sources of income

Physician on FIRE

Yes, he might claim he has learned more from me than I have learned from him, but this young, financially independent anesthesiologist is a marketing genius. He knows more bloggers personally than anyone I know. I told him when he first started out that successful blogging is 10% great content and 90% marketing that great content. If I was half as good at marketing as he is, this website would have twice the traffic. Thanks, PoF!

Lessons learned:

  1. How to successfully use Twitter to grow readership and foster partnerships
  2. A physician income + a Midwest cost of living + very reasonable financial habits = very early financial independence
  3. Growing a blog is mostly about making friends

Mike Piper

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When I was considering starting a blog, I asked Mike (aka The Oblivious Investor) for some advice. It has made a huge difference. His ability to invest simply and write concisely is phenomenal. He is also a whiz of a CPA and a successful author.

Lessons learned:

  1. Your portfolio can be VERY simple and still be successful
  2. You can use more than one 401(k)
  3. Writing and self-publishing a book is not that hard
  4. Bookselling can be a major revenue source for a blogger

Harry Sit

Harry blogged anonymously as The Finance Buff for a long time, and was one of the few successful finance bloggers I knew before starting to blog. I owe him a debt of gratitude for some very useful tips and encouragement he provided when I first started out. More importantly, his ability to think critically through complex tax and investing subjects has helped tens of thousands. Thanks, Harry!

Lessons learned:

  1. Blogging on the side can be successfully combined with full-time work
  2. A Roth 401(k) isn’t a good idea for the majority of investors
  3. How to do your 8606 (Backdoor Roth IRA) right on Turbotax

John T. Reed

You know what the biggest issue is with real estate investing books? All the hype and “ra ra ra” motivational stuff. Take all that away, stuff it with the facts you need to know and the cautions about what can go wrong, and you’re left with John’s books. He also provides a much-needed counterpoint to the Kiyosaki philosophy. Thanks, John!

Lessons learned:

  1. If you’re going to invest in real estate, you better get serious about it
  2. The reason real estate investors can do well are the same reasons they can do very poorly- expertise required and leverage
  3. There is a lot more to your return on a property than the buying and selling price

Dave Ramsey

Here’s another one I’ve mildly criticized in the past, but Dave has helped literally millions of people get a better handle on their finances. Listening to callers on the show is sometimes like watching a traffic wreck in slow motion- you just can’t take your eyes away, but there is a lot of great stuff there. Thanks, Dave!

Lessons learned:

  1. Most people are way too comfortable with debt
  2. It doesn’t take much income to live when you don’t have any payments
  3. The majority of people will benefit most from a simple, easy to follow plan
  4. Most of the time behavior matters more than math
  5. If you do what everyone else does, you’ll get what everyone else has
  6. The more convenient it is to spend, the more you will spend

Thomas J. Anderson

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I reviewed (and criticized) Thomas’s book, The Value of Debt in Retirement. It functions as the best counterpoint I know to Ramsey’s “there is no good debt” philosophy. He advocates a careful, cautious use of debt to boost your bottom line. Thanks, Thomas!

Lessons learned:

  1. Don’t be extreme about debt elimination
  2. Leverage risk may be lower than your other risks
  3. The concept of an “optimal debt ratio”
  4. You can borrow tax-free against your taxable investing account just like your house or life insurance

I’m sure there are many that I have forgotten, and I have certainly learned things from many of my readers who are quick to gently and patiently correct my errors. Thank you all for the influence you have had on my financial life!

What do you think? Who are the big influences on your financial life? Was it their message or the timing of it? Comment below!