Book Review: Enjoy Your Money

Enjoy Your Money by Steve Miller is a pretty neat book targeted especially toward the young and inexperienced when it comes to personal finances, investing and basically, life management.  While many blogs and books cater to either people with broader experience or those who think they’re more sophisticated when perhaps they’re not, this book does a nice job of laying out all the ground rules for a successful financial life.  I’d recommend giving it to any teen, college student or recent entrant to the workforce to start them off on the right path.  Some of the facts, stories and methods will get them psyched to invest, save money, cut expenses and do things right, as opposed to what most of the country is doing.  Here are some examples:

• Personal Finances in America: The book shares some well-placed and shocking statistics to put things into perspective – i.e. 1 in 4 adults lives paycheck to paycheck; in 2005 for the first time since the Great Depression the average American spent more than they earned; 1.5 Million Americans declare bankruptcy each year and so on.
• The Laws of 10s and 7s: Via the rule of 72 (approximately), if earning 10% on an investment like stocks over the long run, you’ll double your money every 7 years.  If earning 7% on say, a more conservative stock outlook or a mix of stocks and bonds, you’ll double it every 10 years.  While many experienced finance readers are familiar with this concept, it’s a neat thing to teach starting investors, especially when they consider how young they are and see how $5000 invested at age 20 can turn into $640,000 at age 69 in retirement.
• Sound Stock Investing Advice: Stocks are long term investments. Don’t start investing in them until you’ve already built an emergency fund…”If the odds of having an expensive emergency in any given year are 1 out of 10, the odds of it occurring during a bear market are almost certain“…sound familiar?
• Benefits of tax-deferral in an IRA account
• Ritzy Neighborhoods = Expensive Lifestyles
• The envelope method
• Loss Leaders when shopping

…the list goes on. Basically, it’s a compact guide of all the basic concepts and strategies that young people should be familiar with (pounded into their heads actually) and I can’t say I disagree with anything I read.  I actually learned a thing or two even though I consider myself to be relatively versed in personal finance and investing topics.  If you know someone 15-30, pick up Enjoy Your Money!: How to Make It, Save It, Invest It and Give It for them, it may very well change their lives!

Disclosure: The book was provided free of charge for reviewing purposes.