Sound Mind Investing Handbook Review

(Advertising policy | Report an inappropriate ad)

At first glance of the Sound Mind Investing (SMI) Handbook, I thought I was back in college. It really is, for all practical purposes, a textbook for helping you manage your money biblically. But while the size, shape, and scope of the book lend itself to a college textbook, the simplicity of the message does not. It is written at about the high-school reading level in a friendly and conversational tone.

Getting a feel for the book

Right from the beginning, Austin Pryor (the author) makes it clear what his purpose with the book is. He explains that the book is not intended to be the “complete guide”, but rather to explain “only what you need to know.” He uses the analogy of understanding how electricity works and understanding how to use a light switch in order to benefit from electricity.

He then goes on to explain that everything written in the book is based on the time-tested principles laid out in the Bible.

What the book covers

Austin starts by tackling consumer debts, which is wise since so many people desperately need help in this area. While he doesn’t quite have the disdain for debt that Dave Ramsey does, he explains that he has “frequently witnessed disastrous consequences of unwise indebtedness.”

I particularly liked his argument for paying off your mortgage before getting heavily involved investing. He explained the security advantage that comes with having a paid for home, that you don’t get by having an equal amount invested in the stock market. As recent times have shown us, retirement accounts really can take a big hit. Whereas if your home is paid off, but it’s value goes down, you can still benefit by being able to live in it!

After the first section about debt, he moves on to…

Section 2 – Saving for future needs
Section 3 – Investing your surplus
Section 4 – Diversifying for safety
Section 5 – Retirement countdown
Section 6 – Investing that glorifies God

When it comes to investing, I liked his simple approach to figuring out the reader’s risk tolerance. The book contains a simple checklist that allows the reader to answer some basic questions which indicate what type of investor they are – and ultimately how they should invest.

The last section of the book sums the whole purpose up very well. Austin points out that God doesn’t need our help or our money, but rather that we need what He has. Personally, what I love about this is that while He doesn’t need us, we have the privilege of being co-laborers with Him. And as the SMI Handbook mentions, by our generosity and giving what we have we can, store for ourselves, “treasures in heaven, where neither moth nor rust destroys, and where thieves do not break in or steal…”

Austin also uses this last section to challenge the readers to give generously and to spend time seeking “Biblically-Responsible Investments” by only making investments that are in line with their beliefs.

Final thoughts

All in all, I think it is a great book for Christians to have on their book shelves. Like I mentioned in the beginning, it has a textbook feel to it, so I think it would be a valuable as reference material. While Austin did not set out to create the “complete guide” the SMI Handbook is pretty thorough.

As far as the type of reader who would be interested, my thinking is that this book would be better suited for the more diligent reader who needs a little bit less hand-holding. In contrast Dave Ramsey’s “Total Money Makeover” works well for those who need an exact and simple plan for getting their financial lives in order. The SMI Handbook, while written in layman’s terms, doesn’t try to be what the “Total Money Makeover” is.