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The Barefoot Investor [2020 Edition, Paperback] $17.10 + Delivery (Free with Prime/ $39 Spend) @ Amazon AU


$1.90 (10%) off the regular price, first drop since December according to camels.

Price History at C CamelCamelCamel.

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  • +2 votes

    Tax info in book relates to 2020-2021. Got a copy of the same edition from Amazon when it was $10

  • +4 votes

    Picked up 2017 edition second-hand for $10 on eBay, if that idea interests anyone.

    There are negligible changes between yearly editions.

    It's popularity means there are lots selling second-hand and many in great condition.

    The content itself:
    (i) clearly written with a female reader in mind, more in style and humour rather than content which is just as applicable

    (ii) this is beginner personal finance stuff - nothing wrong with that, in fact it's what 98% of people need to get right and it's really the simple things that are the most important (i.e. you'll get a lot further in long-term wealth creation by doing well with saving, intentional expenditure, and avoiding consumer debt)

    (iii) it's a bit prescriptive in places, like it's suggestion of having numerous linked bank accounts for singular purposes, and it's recommendation for one particular industry super fund, but focus on the principles


      numerous linked bank accounts for singular purposes

      Don't see the immediate benefits.

      it's recommendation for one particular industry super fund

      Hostplus Indexed Balanced Fund?

      I do wonder whether Scott Pape gets some kind of kickback for plugging Hostplus.

      Someone pointed out to me on a separate OzBargain thread that Hostplus fees are a lot higher (comparatively) than AustralianSuper.
      Does anyone know if AS has a similar option?

      • +1 vote

        Re: multiple bank accounts

        It's about structuring your cash-flow. From memory, he starts by prescribing three accounts, but then it expands later on and ends up being quite numerous and I think a bit too complex. There's a transaction account for weekly expenditure, a "lifestyle" account for mostly social outings or some consumer spending, a savings account for short-term saving goals, a "fire extinguisher" account for paying regular bills and tackling debt, and an emergency fund. Probably most confusingly the "fire extinguisher" becomes this cash-through account for anything, as I think he ends up describing it being used for tackling the longer-term goals of home deposits and investing and retirement.

        For me, too complex for anyone's personal finance. They should be consolidated. I have a principal transaction and savings account with one of the major banks to be used as a single input for all income sources and keep cash-flow available for daily expenditure. I then have accounts with different institutes for express purposes - a savings account where the interest is highest (emergency fund plus any short-term savings not yet invested), a PPOR home loan and a 100% offset account (holding my home and paying my mortgage in a net neutral cash-flow fashion), and a transaction account with a broker (for share investing). That'll expand into further home loan and offset accounts as I enter the next phase of my property investing.

        Even my structure is a lot, but each account has it's fit-for-purpose job and there's no two or three accounts which could be doing the same job in one.

        Hostplus Indexed Balanced Fund?

        Yes, that's the one.

        He addresses kickbacks in the book every time he mentions a financial product - he denies it, and argues that it's clearer to explain his personal choices so people can more easily understand the concept and take it from there with their own research (which is what most financial influencers do and I agree with it, and believe him). I think it's in his interest to maintain credibility and better profit from his business of being a trusted and popular public personal finance adviser than it would taking marginal kickbacks from companies.

        Comparing fees is incredibly difficult between super accounts, as they are complex and opaque. Best to research the one you're in now the best you can, and make an online comparison to others, then only switch if you're seeing a significant difference on what figures you can put together in the comparison. Your best lever of control in super is choice of assets - most people really should be in the highest growth pool, instead of the default balanced pool, unless they're much closer to preservation age (and the funds in super are necessary for funding retirement).

    • +2 votes

      clearly written with a female reader in mind, more in style and humour rather than content which is just as applicable

      LOL. Too bad it doesn't discuss ignorant readers spreading stereotypes.

      • -1 vote

        I'm not sure about that…

        From memory there's one part referring to a woman planning for children (pre 40yo) and her boyfriend…

        I think he writes a few tongue-in-cheek things, like having your own independence by being smart with money management…

        Other than specifics, it has a feel of style marketed to a female more than a male reader.

        Were there any things in the book that makes you think this interpretation is a bit sexist?

        • +1 vote

          Nah, the book's fine. Your interpretation comes from wrong assumptions about what is suitable for whom and you're extending those onto the author's intentions. The woman example is an example, not a wink to you.

  • +3 votes

    I prefer the 2021 edition which takes into consideration that you can't complete the first step of buying a house.

    • +2 votes

      Depending on social circumstances, consider education or post-graduation training options to improve progression in your field, or alternatively options in other fields.

      If you have any consumer debt, it has to go before anything else (any debt that isn't related to education/training or a PPOR fit to your needs).

      Rationalize expenditure - cut down to what gives you value in your life, avoid excess consumerism and lifestyle creep. A savings rate of 10-15% is poor for a person in the first half of their working life when the goal needs to be accumulation. Aim for a 50% savings rate.

      Beyond savings as an emergency fund (6mo expenditure), put savings into high growth assets to beat inflation and grow faster. Broadly diversified funds with low MERs are popular and relatively safe options, like LICs and ETFs.

      Remember this is suppose to be your "first" home, not a "forever" home. A family house on 600sqm in a metropolitan area is very expensive (and often more than necessary) for most young people. Your options become either more economical options, such as modest homes in developments in outer suburbs or regional areas where commuting to work is possible, or a unit or modest townhouse/duplex in a more inner or middle metropolitan suburb. After that is dropping the idea of a PPOR and rentvesting, which is the better wealth creation technique - rent the unit in the city, or house in a nice suburb if you have a family, and invest in metropolitan units/townhouses and suburban/regional homes to start with and build some equity. The equity gives you both wealth and a lot more future housing options.

      • +1 vote

        I just don't agree with the fact that you absolutely need to invest in RE..
        There are in my opinion much easier ways (shares, etfs, etc). Australia is so obsessed with real estate..

        • +3 votes

          Tell that one to my mother, "oh there is a nice little house down the road from me that would be perfect for you, you should buy a house if you are going to have children soon"… guide - offers over 2 Million. (-.-)


            @dandosr: yeah no way I will get so much debt and be slave forever of a property. I am happy to throw my savings in other stuff and rent.
            (and piss off from Australia when I can early retire).


              @ets27: Positive or neutral geared investment property will not keep you a wage slave, particularly if you're continuingly growing your asset pool and passive income (e.g. share portfolio, property volume). Better yet is to improve your cash position - hold a bit more than just an emergency fund, tack on offset accounts to any property debt and keep >5% cash there. It maintains your flexibility and independence… and better yet will secure your future financial independence when you realise higher wealth creation.

              PPOR on the other hand, will be a year-to-year liability until you sell. Buy one if that's what you want for yourself/family, just keep it modest and fit-to-purpose. Otherwise long-term renting (and investing) is just as good, if not better.

            • +1 vote

              @ets27: Its crazy, high cost of living/quality of life declining = less people having children… low population growth = low economic growth… to counter this they increase migration instead of addressing the underlying causes… again cost of living goes up/quality of life goes down…


                @dandosr: Housing is certainly more expensive.

                Depends on the market - it's generally true across the board, but it's focused in metropolitan Melbourne and Sydney where the higher population density (and PPOR demand) exists. The paradigm has changed - the options for first home PPOR has narrowed, young people don't have the same breadth of markets available to them as entry that their parents and grandparents did. Young people need to concede that the entry point in a major metropolitan Australian city is likely to be a unit or a modest townhouse, otherwise they'll need to move out to the outer suburbs or regions (which is where the tension is with most young people as their employment, social opportunities, and desired locations are more city-based).

                Alternatively, the other option is rentvesting, which is a much more effective wealth creation tool and provides both the immediacy of living where desired and the flexibility to change.

                At the end of the day, you need to get started on building an asset pool, and including property in that provides you access to a high growth market, passive income, and equity to improve you future housing options. Not getting started is more risky for your financial independence and housing security in the future than the inherent risks you take on when researching and buying assets. Your time is the most important and only non-refundable commodity.

                As for other costs of living… that's a lot more complex, and you'd need a lot of economic study to get a better grasp of that. Inflation has certainly been low for a long time, and historically low since the 1980s, which when you consider the growth of tech and quality-of-life improvements, is quite remarkable - we're living extremely privileged lives in one of the most affluent countries in a point in history that has never been more stable and developed, at a cost on an inflation-basis on par or less than in previous times in history. Inflation isn't the only marker, however, when you need to consider economic growth and wage growth…

                Fertility rates reflect economic circumstances, but on a relatively minor level compared to many other factors. Societal development and the advancement of family planning and women's rights since the 1960s (maybe 1970s in Australia) have probably had the biggest impact of all in recent history.

                Migration is a very effective counter-balance. Increasing population growth to improve economic markers. Meeting skill shortages. Diversifying society.


          I agree. You don't need to. I'm naturally a very risk-adverse, low debt, high cash-flow kind of person. As such, most of my investments have been ETFs and super (after getting a PPOR and offsetting).

          But property is one of the major high growth assets, and it's the best asset for offering leverage and realising faster wealth creation. Once you start investing a lot of your time in research, you'll find a strategy that works for you, and you can balance it with other financial goals, such as share investing, and achieve greater diversification.

          Personally I'm property investing by focusing on positive gearing (cash-flow) and volume, and primarily looking at serviceable family homes in outer suburbs, regional areas, and non-major cities (read: not Melbourne and Sydney). Also mixing that with low density units in major cities or especially high growth regions is useful too.


        I just bought that first home you describe. It is very brutal out there though! You will be fighting a lot of other first home buyers.

  • +4 votes

    Pro tip: your local library probably has a dozen copies of this. Mine has it digitally as well, i.e accessible as an ebook.


      Second pro tip: The Barefoot Investor didn’t pay to read The Barefoot Investor book either.

    • +3 votes

      Thanks for the tip, my university library has the updated 2020-21 book for free in digital copy

    • +1 vote

      Never take one source as gospel.

      Read this, then read a dozen others…

      I'm not a Scott Pape fan personally. But 98% of this content is very good entry-level personal finance advice.

    • +2 votes

      New method worked pretty well for me, it's not the worst advice. YMMV.


        Same; been using it two years in a row now.


          Haha love getting negged just for having an opinion.

          Did either of you do the maths and compare the new method vs the old way where you claim 52c and your phone/internet etc separately?

          I work from home 2-3 days a week and my deduction claim was nearly $500 higher doing it the old way rather than the "shortcut method"


            @ham0718: Didn't neg you; not sure why you replied to my comment thinking it was me.

            My tax return was completed with the assistance of my accountant.


              @kerfuffle: Wasn't saying you negged. Others did simply because I said Scott Pape might have his best interests in mind first and the people he writes the book for second.

              I was replying to you and @alzori to ask if you'd done the maths as for me the new method would cost me hundreds of missed refund… Exactly what the ATO wants - more tax revenue to stay in their pocket.


                @ham0718: Like I said, my accountant did mine for me. Everyone has a method that works better for them. For you, it's 52 cents. For me, it's 80 cents.