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The Aspirational Investor: Taming the Markets to Achieve Your Life's Goals
The Chief Investment Officer of Merrill Lynch Wealth Management explains why goals, not markets, should be the primary focus of your investment strategy—and offers a practical, innovative framework for making smarter choices about aligning your goals to your investment strategy.
Today all of us bear the burden of investing wisely, but too many of us are preoccupied with the wrong priorities—increasing returns at all costs, finding the next star fund manager, or beating “the market.” Unfortunately conventional portfolio theory and the grand debates in finance have offered investors only incomplete solutions. What is needed, argues Ashvin B. Chhabra, is a framework that shifts the focus of investment strategy from portfolios and markets to individuals and the objectives that really things like protecting against unexpected financial crises, paying for education or retirement, and financing philanthropy and entrepreneurship.
The Aspirational Investor is a practical, innovative approach to managing wealth based on key goals and the careful allocation of risks rather than responding to the whims of the financial markets. Chhabra introduces his “Wealth Allocation Framework,” which accommodates the three seemingly incompatible objectives that must underpin every sound wealth management the need for financial security in the face of known and unknowable risks; the need to maintain current living standards over time despite inflation; and the need to pursue aspirational goals for wealth creation.
Chhabra reveals some surprising facts about wealth creation, reinterprets the success formulas of investing greats like Warren Buffett, and closes the gap between theory and practice by simplifying our understanding of key asset classes and laying out a concise roadmap for identifying, prioritizing, and quantifying financial goals. Raising the bar for what we should expect from our investment portfolios—and our financial advisors—The Aspirational Investor sets us on a path to more confident and fulfilling financial lives.
Today all of us bear the burden of investing wisely, but too many of us are preoccupied with the wrong priorities—increasing returns at all costs, finding the next star fund manager, or beating “the market.” Unfortunately conventional portfolio theory and the grand debates in finance have offered investors only incomplete solutions. What is needed, argues Ashvin B. Chhabra, is a framework that shifts the focus of investment strategy from portfolios and markets to individuals and the objectives that really things like protecting against unexpected financial crises, paying for education or retirement, and financing philanthropy and entrepreneurship.
The Aspirational Investor is a practical, innovative approach to managing wealth based on key goals and the careful allocation of risks rather than responding to the whims of the financial markets. Chhabra introduces his “Wealth Allocation Framework,” which accommodates the three seemingly incompatible objectives that must underpin every sound wealth management the need for financial security in the face of known and unknowable risks; the need to maintain current living standards over time despite inflation; and the need to pursue aspirational goals for wealth creation.
Chhabra reveals some surprising facts about wealth creation, reinterprets the success formulas of investing greats like Warren Buffett, and closes the gap between theory and practice by simplifying our understanding of key asset classes and laying out a concise roadmap for identifying, prioritizing, and quantifying financial goals. Raising the bar for what we should expect from our investment portfolios—and our financial advisors—The Aspirational Investor sets us on a path to more confident and fulfilling financial lives.
245 pages, Kindle Edition
First published June 2, 2015
116 people are currently reading
683 people want to read
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Displaying 1 - 29 of 29 reviews
May 12, 2020
2.5/5 TLDR: read chapter 7, 8 and 9, skip the rest.
I'm not sure what the intended audience of this book is, it lingers on trivial topics and speeds through advanced concepts. You would be ill-served if you used this book for your own portfolio allocation and didn't supplement this book with other sources of information. My background is that I'm not a finance professional but have taken two university level (online) finance courses and read a couple of investments books prior to this one. I've been investing for the past several years and am familiar with basic concepts related to investing.
The first 6 chapters are essentially skippable as regurgitate well-known information without depth and lacking clarity in exposition. Even if the information contained within is new to you, you would be much better served watching youtube videos, doing a coursera course, or simply reading other books about these topics.
Chapters 5-8 could be summarized in 1 page without losing the essence. There was really no need for the author to revisit the same concepts over and over.
Chapters 9 is where the "meat" of this book is. A framework for allocating and thinking about wealth in terms of goals instead of returns. The framework is not that novel as several authors before him have created similar ones, but I did enjoy the simplifications that the author has made as well as his focus on holistic goal-setting. This is the one chapter that I have notes on and that I will keep in my knowledge base to guide my portfolio allocation.
Chapter 11-12 are personal opinions that will likely not apply to many investors so probably not worth reading.
I finished this book in about a day and a half and this is how I would recommend you to read it: skim through the superficial bits and pay close attention to the more beefy chapters.
I'm not sure what the intended audience of this book is, it lingers on trivial topics and speeds through advanced concepts. You would be ill-served if you used this book for your own portfolio allocation and didn't supplement this book with other sources of information. My background is that I'm not a finance professional but have taken two university level (online) finance courses and read a couple of investments books prior to this one. I've been investing for the past several years and am familiar with basic concepts related to investing.
The first 6 chapters are essentially skippable as regurgitate well-known information without depth and lacking clarity in exposition. Even if the information contained within is new to you, you would be much better served watching youtube videos, doing a coursera course, or simply reading other books about these topics.
Chapters 5-8 could be summarized in 1 page without losing the essence. There was really no need for the author to revisit the same concepts over and over.
Chapters 9 is where the "meat" of this book is. A framework for allocating and thinking about wealth in terms of goals instead of returns. The framework is not that novel as several authors before him have created similar ones, but I did enjoy the simplifications that the author has made as well as his focus on holistic goal-setting. This is the one chapter that I have notes on and that I will keep in my knowledge base to guide my portfolio allocation.
Chapter 11-12 are personal opinions that will likely not apply to many investors so probably not worth reading.
I finished this book in about a day and a half and this is how I would recommend you to read it: skim through the superficial bits and pay close attention to the more beefy chapters.
April 20, 2023
The main lesson about not trying to “beat the market” and classifying your assets and objectives in safety, market and aspirational buckets is a very powerful idea.
The author also points out and explains why copying some strategies of successful investors can be a trap for individual investors.
Just didn’t give it 5 stars because some parts were jargon-heavy and a bit hard to understand.
The author also points out and explains why copying some strategies of successful investors can be a trap for individual investors.
Just didn’t give it 5 stars because some parts were jargon-heavy and a bit hard to understand.
September 8, 2015
Good book. Mostly good for everyone, although he lost me a bit in the last 25% of the book - aimed at more sophisticated investors than me. However, here's what I want to remember:
3 buckets for your goals: essential (safety comes first!), important, aspirational, and convert goals into cash flows.
Do these calculations every year:
[savings required this year toward a goal] x [years in the future] = [cost of that goal]
[nest egg for retirement] = [number of retirement years] x [how much you spent in the last 12 months] x optimal adjustment factor
After reading this, I actually paused and whipped out my calculator and did a quick calculation on what our nest egg needs to be to meet our essential and important needs in retirement from age 60-90. Not too bad: &720,000....which appears to be do-able.
Every wealth management plan needs to accommodate 3 objectives: financial security in the face of known and unknown risks, maintain your living standard in the face of inflation and longevity, and pursue aspirational goals (i.e. personal wealth creation, create positive impact, leave a legacy).
3 buckets for your goals: essential (safety comes first!), important, aspirational, and convert goals into cash flows.
Do these calculations every year:
[savings required this year toward a goal] x [years in the future] = [cost of that goal]
[nest egg for retirement] = [number of retirement years] x [how much you spent in the last 12 months] x optimal adjustment factor
After reading this, I actually paused and whipped out my calculator and did a quick calculation on what our nest egg needs to be to meet our essential and important needs in retirement from age 60-90. Not too bad: &720,000....which appears to be do-able.
Every wealth management plan needs to accommodate 3 objectives: financial security in the face of known and unknown risks, maintain your living standard in the face of inflation and longevity, and pursue aspirational goals (i.e. personal wealth creation, create positive impact, leave a legacy).
November 2, 2015
Probably the best book on personal finance that I've ever read.
August 6, 2017
This is a very good book for personal finance that everyone should read. Sure, it doesn't go too deep in strategies and everything mostly because everyone has a different financial situation.
What it does is make you think on what you're goals are and put them in three “buckets”: essential, important and aspirational. And then gives you examples of what should be in those buckets to make some of that sweet cash.
It also helps you find out about how much you would need for your retirement with some calculations written down with some examples in case you're particularly dense like me.
It does a few other things but that's what I came away with from reading it. It's an easy read and he somehow makes it a fun read too. I would recommend it as a good starting book for anyone.
What it does is make you think on what you're goals are and put them in three “buckets”: essential, important and aspirational. And then gives you examples of what should be in those buckets to make some of that sweet cash.
It also helps you find out about how much you would need for your retirement with some calculations written down with some examples in case you're particularly dense like me.
It does a few other things but that's what I came away with from reading it. It's an easy read and he somehow makes it a fun read too. I would recommend it as a good starting book for anyone.
August 20, 2019
Shorter book, which you can probably finish in 2-3 hours. I found it to be useful whether or not someone has a deep understanding of finance, as the author explains not only definitions, but where many of these terms originated. Key reading material from some of the more well known economists are highlight as well.
In the end, the book gives an overview of how some of the best financial advisers became the best, and why everyone else cannot emulate that kind of success. The author finishes with a framework for success, which I'm confident anyone could follow. Typically I find these to be not very helpful, but it was thoroughly explained here.
In the end, the book gives an overview of how some of the best financial advisers became the best, and why everyone else cannot emulate that kind of success. The author finishes with a framework for success, which I'm confident anyone could follow. Typically I find these to be not very helpful, but it was thoroughly explained here.
September 1, 2021
This seems like a very long magazine article rather than a book. It's a light and quick read, and does provide some insights, namely: how to re-think your own financial goals in light of probable outcomes, for example, what is the function of risk and return at different levels of wealth and stages of life? How may we think of portfolios beyond the rational aspects? What are the dangers and resource requirements of managing your money the way most consumers do? ... or how about Harvard and Yale endowments? Normally, I wouldn't recommend it, but because it's a quick read and reveals a few gems, I'd say it's worth the time even for a seasoned investor.
January 13, 2019
Nice new perspective for me.
Fundamentally, trains you to think of your portfolio in terms of the buckets, low risk, medium risk and high risk.
The first one is what you cannot afford to lose capital on and hence need to invest in ways that offer decent chances of portfolio growth with least risk of loss.
The third bucket is where you can get most experimentative in a race to try and multiply your portfolio value.
How much to invest in each bucket depends on where you are in terms of a portfolio size versus life goals.
Fundamentally, trains you to think of your portfolio in terms of the buckets, low risk, medium risk and high risk.
The first one is what you cannot afford to lose capital on and hence need to invest in ways that offer decent chances of portfolio growth with least risk of loss.
The third bucket is where you can get most experimentative in a race to try and multiply your portfolio value.
How much to invest in each bucket depends on where you are in terms of a portfolio size versus life goals.
February 12, 2024
Author Ashvin Chhabra expands on the concepts outlined in his award winning white paper (Beyond Markowitz: A Comprehensive Wealth Allocation Framework for Individual Investors) to provide the nothing less than the best framework I have ever come across for organizing one's investment life. The negative reviews of this book really puzzle me, as after reading more than 200+ books on this topic, I rate this as one of the very best. I cannot recommend this enough for anyone who wants to understand the "big picture" about how to best synthesize their working, investing and personal life!
December 31, 2019
A decent, well structured, to the point book, more on "self-help" side rather than academic.
Very good introduction into personal wealth management, providing a framework for connecting individual life goals with various asset allocation options to support them, and investment risks associated with the latter.
Very good introduction into personal wealth management, providing a framework for connecting individual life goals with various asset allocation options to support them, and investment risks associated with the latter.
August 7, 2023
It captures the main essence well that investing is not about alpha, but all about your objectives you want to achieve from the returns earned through investing. Other than that, the model itself I felt a little underwhelming and not at all practical to put to use.
Security -> Stability -> Aspiration is a nice way to bucket your financial goals.
Security -> Stability -> Aspiration is a nice way to bucket your financial goals.
April 17, 2020
Very superficial.
February 4, 2024
This book is just trying to paraphrase other personal finance book, inventing new framework to make it interesting but in fact there is absolutely nothing new can be learnt from this book
August 21, 2025
not sure what to think about it, it's trying to say that being invested too much into risky assets can be well.. risky
Need to review for some ex-tractable information
recommendation: [The Tim Ferriss Show Transcripts: Graham Duncan (#362) - The Blog of Author Tim Ferriss](https://tim.blog/2019/03/01/the-tim-f...)
> Ashvin suggested a totally different approach to portfolio construction based on how people actually behave and what they actually care about.
Need to review for some ex-tractable information
recommendation: [The Tim Ferriss Show Transcripts: Graham Duncan (#362) - The Blog of Author Tim Ferriss](https://tim.blog/2019/03/01/the-tim-f...)
> Ashvin suggested a totally different approach to portfolio construction based on how people actually behave and what they actually care about.
September 15, 2019
Interesting concept and how the investment portfolio is represented. However, IMO, it’s more theoretical than practical.
February 9, 2017
This was a significantly more technical book than most of the personal finance genre. Although a bit dry at times, it definitely provided a wealth of knowledge and some interesting thoughts on the process of determining your investing approach. I have a lot to think about.
July 17, 2015
So this book is okay if you are interested in find out different ways in investing your money. It focuses on your goals and aspirations to your investments rather than just the basic concept. Its pretty easy to understand if you know what you are looking for to put your money into. There are many tips and tricks to follow and read up on that may help you out in the long run. For people who don't really understand investing this book can be hard to read and understand and get lost in. I for one had lost myself more than several times, but I think it's just because I don't really have a true understanding of investing my money to try to make more out of it. If you have certain financial goals that you want to achieve then you should read this book.
(Please Note:I have recieved this book from GoodReads First Reads, in exchange for a review.)
(Please Note:I have recieved this book from GoodReads First Reads, in exchange for a review.)
August 4, 2015
Yet more advice for individual investors on how to plan their personal investments. The author suggests dividing one's investments into three categories: safety (enough to protect oneself from poverty; as riskless as possible), market (offering a high probability of maintaining one's standard of living), and aspirational (offering the possibility of achieving upward wealth mobility). This is a slight twist on classic investment advice. I suspect that most people who are well off will find that, without having formally divided their investments in this way, they have still followed this general approach.
August 26, 2016
I appreciated the different way this book offers readers to look at investing, but I found it very broad. It was more of a general guideline to managing goals and necessities, and mostly a common-sense one at that. Definitely a good reminder, but hardly scratched the surface. Since everyone's situation is different, it was forced to focus on planning rather than the implementation and detailed strategy. Good to keep in mind, but I would have liked to see more research that supported its view rather than research that pointed out flaws in other strategies.
October 4, 2015
This book is worth checking out of the library, but doesn't have enough meat to make it worth owning. It describes a useful framework for thinking about investment buckets: Safety, Market, and Aspirational. It touches on some principles for sizing and investing each bucket. It refers to a number of the great books and articles about market investing, which can point you to more information on how to invest the market piece. It is a very quick read.
December 7, 2015
Gives a good summary of the 2 different philosophies that are out there in the financial world as to how people should invest. Active management vs index (or passive) plus a whole bunch of background as to where modern thought about many things financial has come from.
He then goes on to his own view based on Maslows hierarchy which is based in common sense but just a different way of explaining how people should figure out their finances.
He then goes on to his own view based on Maslows hierarchy which is based in common sense but just a different way of explaining how people should figure out their finances.
July 22, 2015
Good foundation for a new style of thinking about investments
This book covers what financial planners and others do not talk about when investing your money. Good way to focus is what do you want in life and it is not about beating the market
This book covers what financial planners and others do not talk about when investing your money. Good way to focus is what do you want in life and it is not about beating the market
November 10, 2015
Book talk about invesments & what to avoid in invesment
Conclusions on what returns of invesments what to have in portfolio.
I alson like the alpha beta method
But i disliked the way he ignored ways to make invesments on other type of investings & concentrate on stocks only
Conclusions on what returns of invesments what to have in portfolio.
I alson like the alpha beta method
But i disliked the way he ignored ways to make invesments on other type of investings & concentrate on stocks only
February 21, 2016
You should read this book unless a) you are an academic already deeply familiar with Ashvin Chhabra's work or b) you are Ashvin Chhabra. Everyone else should read it immediately, and should feel free to skip basically all other investing books.
January 4, 2017
Entertaining if you like reading about investing but....
I didn't find useful strategic information for me. This is really meant for high net worth folks with large salaries. Good thing it only cost me $1.99
I didn't find useful strategic information for me. This is really meant for high net worth folks with large salaries. Good thing it only cost me $1.99
April 8, 2022
Good overall book on finding out why to invest with focus on goals and how to think about investing. Less focus was provided to what methods might work for you rather two deep dive examples of different methods. Good overall book on risk/reward of investing.
September 28, 2015
interesting premise, fails to deliver
February 9, 2020
Great framework!
April 27, 2021
Knew most of it but did make me pause for thought. A new approach to retail investing/personal finance that I hadn't heard before.
Displaying 1 - 29 of 29 reviews