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Thursday, January 2, 2014

Book Review: The Total Money Makeover {Booksneeze}


A Total Money Makeover: A Proven Plan for Financial Fitness by Dave Ramsey
ASIN: B00DNBE8P6
Ebook
Publisher: Thomas Nelson
Retail: $24.99

About the book
If you will live like no one else, later you can live like no one else.

Build up your money muscles with America’s favorite finance coach.

Okay, folks, do you want to turn those fat and flabby expenses into a well-toned budget? Do you want to transform your sad and skinny little bank account into a bulked-up cash machine? Then get with the program, people. There’s one sure way to whip your finances into shape, and that’s with The Total Money Makeover: Classic Edition.

By now, you’ve heard all the nutty get-rich-quick schemes, the fiscal diet fads that leave you with a lot of kooky ideas but not a penny in your pocket. Hey, if you’re tired of the lies and sick of the false promises, take a look at this—it’s the simplest, most straightforward game plan for completely making over your money habits. And it’s based on results, not pie-in-the-sky fantasies. With The Total Money Makeover: Classic Edition, you’ll be able to:
Design a sure-fire plan for paying off all debt—meaning cars, houses, everything
Recognize the 10 most dangerous money myths (these will kill you)
Secure a big, fat nest egg for emergencies and retirement!

My thoughts:
...long exhale... This book has some really great information and a formula, if I can call it that, for 'living like no one else so that later you can live like no one else'. I've only heard good things about Ramsey and his books so I was excited to read this book {as much as one can be when reading a book on how to get fit}. It is a very easy book to get into; many real-life stories are included throughout. 

Beginning the book, I was encouraged but as I read on, it was akin to drudgery. It was because of his style, however, not entirely the information he put forward. My not caring particularly for Ramsey's style of writing {and ultimately his advice for financial 'fitness'} began with the myths he was presenting. I understand the myths and agree with him...for the most part. What I didn't like or agree with necessarily was his comebacks for them. How he 'disproved' them. Many times he really didn't. 

For example, "90 Days = Same As Cash" scenario. Ramsey says that that's just not true. Why does he say that? Because most people don't pay it in 90 days. That doesn't make the whole thing wrong, just to those people. We've used the "90 Days = Same As Cash" on a few occasions that were exactly as claimed. The same with credit cards. I do know people who have one and use it responsibly. It can be done; it just isn't often.

Another myth: "I don't have time to work on a budget...etc." His comeback? "You don't have time not to." Of course he does go into more detail in the paragraphs that follow the statement of myth and truth, but still, such a lame comeback didn't win any gold stars with me. Another not so great one: "I can't use cash because it is dangerous; I might get robbed," followed by this: "You are being robbed every day by not using the power of cash." The others in the section are better. 

He does also talk about sacrifice, which I agree with. To a point {of course}. Two things I don't agree with paying cash for and 'settling' for are a reliable car and a safe and dependable house. You can pay cash for those, if you are at that point but if you aren't, I don't agree with not going into debt for those two things. Not extravagance but necessity.

My final negative bits about this book {and then I promise to point out the positives} are in regards to his approach to those who are reading the book. I got the impression I could not possibly be able to manage my money without following his guidelines. I also felt like he was addressing someone who is well, less than smart. He uses the word 'stupid' in the book 31 times {according to my Kindle}; a word that I cannot stand. It's just a personal issue. Talking with my husband while reading the book, he {my husband} said it sounded like those who read the book are desperate. Perhaps that is what it is; I'm not desperate so I didn't like the tone that I must be.

The formula is basically this {all this is from my memory- not to be taken verbatim}: 

  1. Save $1,000- fast- this is the basic 'emergency fund' {cut that to $500 if one makes less than $20000 a year}
  2. Debt Snowball- list debts smallest to largest and work on paying them off in that order
  3. Finish the Emergency Fund- this is a 3-6 months of expenses fund- it depends on individual situations
  4. Invest 15% of Income in Retirement
  5. Save for College- for your kids
  6. Pay Off Your Home Mortgage

And it is to be done in that order. If something happens while you are in step 4 and your emergency fund is, well, defunded, you go back to the step where you build it back up. 

The positives of this book are that he is right on about many of the money and debt myths that people often believe. You don't have to have a credit card to live life. Debt is not a 'given', at least not in the way that many people believe it. There are so many, too many, who when they reach retirement have nothing and must still work, and work hard, to get by. The stories of real-life people, couples and single, and families throughout the book is very encouraging. It helps readers identify. 

I like the idea of paying cash whenever possible and without reading this book I probably wouldn't have really contemplated it more than a passing thought. It is doable and makes a lot of sense to me. The 'emergency fund' is so important! We had a few 'emergencies' {fortunately none life threatening} in 2012 that prevented us from taking a family trip that we'd planned for a couple years. If we'd had that fund in place, we would have been good to go. 

Overall, I think it is a good book and program. He has much sound advice and many have followed the program, and others he has put out, with much success. I think it's a book that one would need to read themselves to see if it is going to benefit them. 

***Disclaimer: I received this ebook from Thomas Nelson via BookSneeze for free for the purpose of this review. All opinions are my own. See Disclosure/Policies. ***

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