Yes, You Can Be A Successful, Income Investor: Reaching for Yield in Today's Market [Paperback]

Ben Stein (Author), Phil DeMuth (Author)

Book Description

Publication Date: February 15, 2006

      With the bursting of the stock market bubble, and after 13 rate cuts by the Federal Reserve, yields on CDs and Money Market funds tread at historic lows—a negative return after inflation. With smaller savings coupled with lower returns on what savings remain, retirees and others living on fixed-income investments watch in horror as their income checks shrink with each passing month. 

        However, there are investments that still earn a significant rate of return—and do so reliably and consistently. These fixed-income securities include bonds, real estate investment trusts, preferred stocks, and emerging market debt, among others. As 70 million Americans reach retirement age in the next 15 years, fixed-income investing will become a sociologically inevitable megatrend. This book shows you how you can safely secure the highest possible yield from your savings.  

Editorial Reviews

Amazon.com Review

Aimed at those living on a fixed income or on the cusp of retirement, Yes, You Can Be a Successful Income Investor! explains the basic building blocks of fixed-income investing and offers advice on getting the highest possible yield while minimizing capital losses. At a time when interest rates are unusually low and with more Americans than ever reaching retirement (a trend that will continue for the next 15 years), this is particularly timely information. Ben Stein and Phil DeMuth sift through dozens of investment options and highlight the stocks and bonds with the greatest income yields in recent years as well as some strategies and investments that should be approached with caution. They also discuss how to develop a diverse portfolio, name specific investments and explain their yields and risks, and help readers develop an overall strategy based on goals and needs. There are also chapters on the bond market, annuities, winning stocks, various investment products, real estate investment trusts, and a look at the hard numbers on various mutual funds.

Stein, an economist and part-time TV and movie personality, and DeMuth, an investment psychologist, make a good writing team. They combine a wealth of information, including hard data, graphs, and charts, with a clear and precise writing style that investment novices will appreciate. The book also contains practical tips and advice designed to help readers do their own research and know the questions to ask when dealing with investment professionals. --Shawn Carkonen --This text refers to the Hardcover edition.

About the Author

        Ben Stein can be seen talking about finance on Fox TV news every week. He has written about finance for Barron’s and The Wall Street Journal for decades and contributes regularly to the AARP’s Modern Maturity (now AARP: The Magazine). He was one of the chief busters of the junk bond frauds of the 1980s, has been a long-time critic of corporate executives’ self-dealing, and has written several self-help books about personal finance.

        Phil DeMuth is an investment psychologist with a longstanding interest in the stock market. He has written for The Wall Street Journal and Barron’s, as well as Human Behavior and Psychology Today. His opinions have been quoted on theStreet.com and Fortune Magazine and is president of Conservative Wealth Management in Los Angeles.

Product Details

• Paperback: 240 pages
• Publisher: New Beginnings Press (February 15, 2006)
• Language: English
• ISBN-10: 1401903207
• ISBN-13: 978-1401903206
• Product Dimensions: 6.3 x 0.6 x 9.4 inches
• Shipping Weight: 12 ounces (View shipping rates and policies)
• Average Customer Review: 4.5 out of 5 stars  See all reviews (13 customer reviews)
• Amazon Best Sellers Rank: #492,231 in Books (See Top 100 in Books)

Most Helpful Customer Reviews

73 of 74 people found the following review helpful

5.0 out of 5 stars Excellent handbook to take charge of your financial future May 3, 2005

By Craig Matteson HALL OF FAMETOP 500 REVIEWER

Format:Hardcover

Ben Stein and Phil DeMuth are very dedicated to helping people get serious in preparing for retirement. They bring several strong virtues to this task. First, they not only reject investment fads, they believe in and focus on solid investment basics. Second, they believe that you have the final responsibility for your money, so if an investment or financial program is too complicated for you to understand in every detail, they advise you to stay away from it. Third, they understand and preach diversification. Simply, diversification aids the investor by removing the risk associated with investing in just one firm or one market sector and therefore stabilizes earnings.

The idea behind this book is quite good. For the past two or three decades, all the talk around investing has been about growth stocks where you make your money by realizing capital gains. Before the age of double dividend taxation, people invested for the income provided by dividends. The present market for stocks is priced high in historical terms (see Stein and DeMuth's excellent "Yes, You Can Time the Market" to understand why this is true) and it is all too likely that a correction could provide losses instead of gains. In this book, the authors provide an approach to investing that provides a return by gaining dividend income from stocks and interest income from bonds while avoiding the risk of capital losses as much as possible.

Stein and DeMuth begin by talking about bonds. They provide an excellent primer and then talk about the various types of bonds, their risks, and their returns. Their discussion will help the reader understand that a higher return comes with increased risks. In effect, the higher return is a compensation for taking on that higher risk. The authors help the reader understand that there are some bonds whose increased risk is worth taking and many whose higher return is not sufficient compensation for someone counting on the income for their daily bread.

The discussion then turns to developing a stock portfolio that is designed for income rather than capital gains. This is an excellent and important discussion because it runs counter to most of the stock talk of the past generation. Just as with bonds, they show the effects of various portfolio constructions. They are very good on what matters to the income investor and what is dangerous to your financial health. They have a short chapter on preferred stock that is interesting and gives adequate warning to stay away from complicated investments that you don't understand.

The section on REITs is terrific and will help the average investor understand them. They can be an excellent part of a portfolio and are an excellent way to participate in real estate without having to own and maintain your own properties. Remember, in retirement you want to be enjoying yourself, not going through the hassle of being a real estate manager.

They also talk about annuities in a sensible and helpful way. Stein recounts how annuities helped his parents have a terrific retirement. The authors also balance that with cautions about the balance between fixed and variable annuities and offer solid advice about their complications. They note that most of the people who sell annuities don't really understand what they are selling and to stay away from those you don't understand completely.

The heart of the book is the section on how to combine all of these investments into a portfolio that balances your ability to take risk versus return. They provide various example portfolios while always encouraging you to do your own research. They want you to use the examples as models of what to do rather than as investment recommendations.

Stein and DeMuth also provide a very good website that provides current information and links as well as errata for the book (you know the small typos that creep into any book).

This is an excellent handbook for anyone who wants to take responsibility for his or her retirement and is serious about understanding what is involved. There are too many sad stories of people who work their whole lives to save some cash and then have it evaporate in some inappropriate investment that promised them gold falling from the sky. Stein and DeMuth have provided an excellent guide to understanding what is real and what is fluff. You could not spend $23.95 better than to buy this book and then study it carefully. If you do, you will be a much better investor and steward of your financial future.

17 of 20 people found the following review helpful

5.0 out of 5 stars Income Investing Bible December 7, 2005

By Bobby Joseph

Format:Hardcover|Amazon Verified Purchase

This was the best income investing book I have read. I loved this book, it was superbly well written with practical income investment advice in stocks, bonds (treasuries, corporate, municipal, junk etc) and real estate (REITs). This book would be very useful regardless of the amount of money you have to invest. The authors make specific recommendations without any vague statements. There is income portfolio advice. It is easy to read and I finished it in one sitting. The book had a lot of humor sprinkled throughout. I loved the two stories in one of the earlier chapters in which the authors said that if you understood these 2 stories you would understand the bond market and they were right on! There are plenty of numbers and figures but the authors have accomplished a remarkable feat in that they wrote the subject matter in such a way that any high schooler could understand. Yet the material is far from "dumbed down".

7 of 7 people found the following review helpful

5.0 out of 5 stars A very different investment book January 5, 2007

By L. F. Smith TOP 1000 REVIEWERVINE™ VOICE

Format:Paperback|Amazon Verified Purchase

This is a very different investment book. While the books one typically sees suggest ways to get rich-- that is, to accumulate capital-- as quickly as possible, this short, readable book suggests that those near or in retirement should be thinking about how to deploy their resources in a way that maximizes their income. That is, staying comfortable is more important than getting rich.

Stein and DeMuth explain that most investment fads are not only unsuitable for older investors, but, worse, they just don't work. They make a point that many people who lost their money in the market meltdown a few years ago should have thought about: If an investment is too complicated to understand, then it should be avoided. In the end, there's no magic bullet; diversification and adherence to investment basics will pay off. The body of the book is devoted to explaining how to do that.

The book discusses various types of bonds, dividend-paying stocks, real estate investment trusts, and annuities. The one thing that is mentioned in every chapter is the basic principle that risk and reward are in balance; the only way to get a high reward is to take more risk. Striking the correct balance is, of course, an individual decision, and the most important part of the book is the discussion about how to combine various types of investments in in a way that balances risk and reward. There are numerous sample portfolios and many specific bond and stock funds suggested-- and also numerous cautions that investors need to do their own research before they buy anything. The authors provide a link to their website, which provides current information and links.

A bonus is that unlike many investment books, this one is very readable. The authors don't dumb anything down, but they take pains to explain things without using jargon. Readers familiar with Stein's TV and movie style of delivery will recognize it here, too.

This is a very valuable book that will provide the reader with a lot to think about-- and a good way to do that thinking.