With that in mind, I've heard MMM's and "Your Money or Your Life"'s strategies derided as "Live like you're poor now so you can live like your poor later." With dilemmas like that, you get into the thorny question of values: What do you want your kids to expect out of life? At the same time, as a parent, it's your life too. In that life, how do you balance fun with saving? How much should you sacrifice for your children? One of the few child-related anecdotes in "Your Money or Your Life" involves a man whose parents paid for his college, but decides his kids are on their own. When you talk about extreme thrift, surely you can put art classes, play, basketball, Little League, mini-soccer, ice skating, and skiing on the chopping block. However, kids throw a thought-provoking monkey wrench into "Your Money or Your Life's" strategies. I think cost-tracking is essential when it comes to saving money and that Target and the mall are about the worst places on earth to pass time. To a certain extent, I enjoy savings more than spending so "Your Money or Your Life" is preaching to the converted for me. I suspect this step is easier said than done as well!Ĩ) This step covers "Capital and the crossover point": when does your money start earning more than your job?ĩ) What to do with your money - outdated advice about how great US treasury bonds are. You only have a finite amount of time on the planet."ĥ) Make a large line graph with your findings so you can't deny your income and your expenses.Ħ) Value your life energy, minimize spending!Īs Elizabeth Warren observed in "The Two-Income Trap," this is easier said than done.ħ) Value your life energy, maximize income! Who knows how many unopened "cheap" DVDs I've bought! "Your Money or Your Life" would argue "DVDs you don't open aren't worth your life energy. The book uses the phrase "gazingus pin" as a term for something you enjoy buying, but don't need. Show spending in terms of "life energy" spent. It's also helpful in showing where all the money goes!ģ) Tabulate your findings. This is a useful step showing how commuting (time and money), buying work clothes, and eating out add to the cost of working for a living. This is sort of dispiriting step because you don't have anything to show for paying the rent!Ģ) Recalculate your salary to show how much "life energy" is devoted to your job. Step 1) Tally up all the money you ever made, look around you and see what you have to show for it. "Your Money or Your Life" proposes a nine-step program: Money Mustache, who actually posted an excellent review of the book. The book is sort of like an early 90s version of Mr. To quote Lao Tzu, "He who knows he has enough is rich." It makes the compelling case that to always want something better is a recipe for perpetual unhappiness. The goal is to live modestly and be time-rich, rather than to "live large" and be time-poor. In essence, the book advocates extreme thrift in an effort to get off the consumerist treadmill. The other chapters, though they occasionally make redundant arguments, are valuable. The present interest rates on those bonds is pathetic: 2.69% on a *30-year* bond! Read in 2015, Chapter 9, which describes 6% US treasury bonds, reads like a quaint historical document. Also, its advice to buy long-term US treasury bonds is terrible. As of, the Dow stands at 17,511.57, up about 450% since 1992 so the book's stock market wariness is exaggerated. When the book was copyrighted in 1992, 1000 was a crash and 4000 was ambitious. The Epilogue summarizes in 9 pages what has been beaten to death in the previous 327!Īt one point, the author talks about being financially secure whether the Dow is under 1000 or above 4000. Like most personal finance books, it's full of suspicious stories. That said, I have a few qualms with the book. I agree more with the 5-star Goodreads evangelists. This book's most popular Amazon review is surprisingly negative: 3/5 stars.
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