Among the book's many attributes are the following: good advice on how to research companies before investing in them; strong suggestions for which companies to invest in; a clear explanation of why it is so important to have dividend paying stocks in your portfolio; and interesting insights into how taxes work. (In a nutshell, the book explains how income from dividends or capital gains attracts a much lower tax rate than employment or tax income. The book therefore argues that one should rely as much as possible on investment income in order to pay less tax).
After reading this book I was left with a high opinion of this author. Some further research, however, led me to discover some things that were quite ironic. For instance, this book, which was published in 2005, strongly argues for the buy-and-hold approach to stock investing, i.e. one should NEVER sell their stocks once purchased. Nevertheless, in February 2009, Derek Foster broke his own rule by selling all of his stocks in order to move to cash. As well, his original philosophy of buying dividend stocks and then holding them forever was a little misleading, as he also owned Income Trusts which are a different beast than large-cap companies that pay dividends.
As the warning at the beginning of this book makes clear, one should not take the advice in this book literally. On further reflection, one can find problems with the investing advice that is being espoused. That being said, as a purveyor of strong general concepts of how to invest, this is a good book that provides a lot of valuable suggestions, and for that reason it is worth the read.
4 out of 5 stars
