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The Adventures of Money Blog.

Tuesday, April 18, 2006

Review - All Your Worth

So, now you've read "The Two Income Trap" and you're thinking, "Oh cussword, I'm stuck. This is totally my situation! What can I do?" Well, the authors (Elizabeth Warren and Amelia Warren Tyagi) were awful nice and answered your question in the book "All Your Worth: The Ultimate Lifetime Money Plan."

So, we've read "Smart Couples Finish Rich" and have heard all sorts of budgeting ideas. Neither of us really seemed to have the discipline to be that detail oriented with our money. It seemed more of a hassle than anything. And that silly advice of "don't buy designer lattes" didn't apply to us at all. Not only do I not drink coffee, I'm a rare breed who doesn't even like its smell. And by this time, we knew we had a baby on the way. Money was starting to become a big concern.

It may be safe to say that "All Your Worth" saved our financial lives. Now, we probably could have stayed afloat without it. In fact, I'm sure we would have managed.

I'll put it another way. Without this book, we would have been forced to move in with Erik's parents, and scrimp and save to know that we can get by on one income and without consumer debt.

After having read the book, we happily and willingly moved in with Erik's parents, we are comfortably saving, paying down our debts, have some money to play with (guilt free), and feel like we're doing well financially.

Here are some reasons I rave about this book:

It's the first financial management book that I felt applied to me. "You watch what you spend, you don't waste you're money on designer lattes, yet you're still just scraping by. Here's what you can do..." And it didn't skip straight to the usual "if you were smart and put $50,000 into a retirement plan you'll be wealthy" stuff the books always say. Sure, it said saving for retirement - and a rainy day - and for your dreams - is important... but nothing left you saying, "yeah right, and where do you think I'm gonna find $50,000 available to stock away where I can't get to it?"

It didn't expound on the virtues of owning a home. In fact, it said if you can't afford a home, don't buy one!

It DID say this: If you're struggling to get by, you're either spending too much on your must-haves or too much on your wants. It's all about balance. Then, they break down how to figure out which one you're doing, and several ways to fix the problem.

All the basic recommendations were easy to follow, and have put us where we are today - easily in the black. It's common sense simple, and takes the work out of budgeting.

I LOVE this book, and still claim it is the best financial planning book I've ever seen. A MUST read, and probably even a must own. (I took copious notes.)

2 Comments:

  • At 4/20/2006 6:23 AM, Anonymous Anonymous said…

    I just wanted to clear something up. When David Bach talks about "Desinger Lattes or "The Latte Factor" he doesn't mean just coffee. It stands for all the small purchases you might make on a daily basis that add up over time. Such as magazines, stopping at the conveince store for sodas and snacks, etc. Some people do a lot of this extra spending and some don't. A lot of people don't realize how much these little purchases are costing them every month until they start keeping track. The term "Latte Factor" came from those expensive cups of coffee that people will buy everyday. They think that just a few dollars a day is no big deal. They then keep track and add them all up and find that they would have approx. $60 extra every month. That would be about $720 a year. So, they start making coffee at home or cut back on buying it everyday and save some $$ that can be used towards debt or something else.
    You just have to figure out what your "Latte" spending is! It may be a little or it may be a lot! When you're trying to get out of debt, every penny counts!!!

     
  • At 4/20/2006 11:42 AM, Blogger Amber said…

    I do understand that, sorry I wasn't clear about it, and thank you for pointing it out.
    The point to me, though, is that keeping track of every little expense is annoying and takes time. All Your Worth is about overall balance. Just take out a fixed amount of cash each week to spend on groceries and whatever else you need or want. If you know all you have to spend is cash in your hand, you'll not feel guilty every time you decide you'd like to buy a candy bar, and you won't over spend. Yes, the price of daily little extras can add up - but it's part of LIVING.

    P.S. please sign your comments. "Anonymous" makes me sad.

     

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