Having finished Suze Orman's book about Women and Money, I've been feeling inspired to continue reading books on the subject of personal finance and am currently reading this book which was recommended by a YouTuber I follow, who also happens to be a follower of Dave Ramsey's programme, namely The Former Mrs Jones.
She has recommended this book a few times in her videos and when OH asked me what I wanted for Christmas, this happened to be the only book on my Amazon wish list, so he bought it for me.
I'm not very far into it, but it is quite fascinating reading. It is basically the result of a major survey of over 14,000 millionaires in the US and it looks at how they became millionaires, what they spend their money on (and more to the point what they don't) and what their net worth actually is and what it realistically should be based on their age and income.
What is really interesting about this book, is that it uncovers the fact that most millionaires don't inherit their wealth, but create it themselves, by being careful with their money, spending it wisely and investing it. They don't for the most part drive expensive foreign luxury cars, wear a fancy watch or dress in designer labels, far from it, they are more like to drive a ten year old Ford, wear a cheap Timex watch and shop in local department stores for their clothes.
Now this might sound very boring and dull to many people, but what's boring about having enough income not to have to worry about money and having the financial independence to do whatever you want in life and not be a financial burden to your children.
Far from finding it boring, I find it very inspiring, as it makes you realise that it is possible for even the most ordinary person to become very comfortably off if they just take a little care with how they spend and invest their money. I almost wish that I had read this book ten years ago as my finances might have been a little different to what they are today.
What the research did find, was that quite often those who are earning large salaries are not the ones who have a high net worth of $1 million or more, because they are the ones who are often caught up in the consumerist culture, whereby they live paycheck to paycheck, using their income to buy the kind of products they think everyone thinks they should own and wear and in reality they often have very little by way of savings or investments that could sustain them should they lose their job.
Whilst reading this book I can recognise myself in some of what is written. Spending what comes to me and not really thinking or planning for the future, hence why this year, I want to turn things around and get myself on a better financial footing. I guess recognising where you're going wrong is a good starting point for that.
I'm thoroughly enjoying this read. There are lots of tables full of data in the book, making it a little like a social science text book, so it might not appeal to everyone, but you can read it without paying too much attention to these and I'm a bit weird, as sometimes I like to read this kind of data.
This book has been in print for 20 years now and was originally a New York Times Best Seller, so it definitely has proved itself to have some merit. However, although you can still glean a lot from it today, which I am doing in reading it, there have been some big changes in the world in the past 20 years, which have possibly dated it a little.
What I mean by this statement is that the internet has potentially changed a lot of things in terms of personal finance in our world today. They have created sources of income for many people, especially with such sites as eBay and the YouTube and to some extent it has democratised the art of making some serious money creating many millionaires as a consequence. I'm not sure if the book will cover this aspect of today's wealth and society, but it will be interesting to see. Nevertheless, I think it is probably worth a read regardless. If it sets you on the right road to getting your finances in order, it's got to be worth it.