Synopses & Reviews
If you’ve ever bought a personal finance book, watched a TV show about stock picking, listened to a radio show about getting out of debt, or attended a seminar to help you plan for your retirement, you’ve probably heard some version of these quotes: “What’s keeping you from being rich? In most cases, it is simply a lack of belief.” —SUZE ORMAN,
The Courage to Be Rich“Are you latte-ing away your financial future?” —DAVID BACH,
Smart Women Finish Rich“I know you’re capable of picking winning stocks and holding on to them.” —JIM CRAMER,
Mad Money They’re common refrains among personal finance gurus. There’s just one problem: those and many similar statements are false. For the past few decades, Americans have spent billions of dollars on personal finance products. As salaries have stagnated and companies have cut back on benefits, we’ve taken matters into our own hands, embracing the can-do attitude that if we’re smart enough, we can overcome even daunting financial obstacles. But that’s not true. In this meticulously reported and shocking book, journalist and former financial columnist Helaine Olen goes behind the curtain of the personal finance industry to expose the myths, contradictions, and outright lies it has perpetuated. She shows how an industry that started as a response to the Great Depression morphed into a behemoth that thrives by selling us products and services that offer little if any help. Olen calls out some of the biggest names in the business, revealing how even the most respected gurus have engaged in dubious, even deceitful, practices—from accepting payments from banks and corporations in exchange for promoting certain products to blaming the victims of economic catastrophe for their own financial misfortune.
Pound Foolish also disproves many myths about spending and saving, including:
- Small pleasures can bankrupt you: Gurus popularized the idea that cutting out lattes and other small expenditures could make us millionaires. But reducing our caffeine consumption will not offset our biggest expenses: housing, education, health care, and retirement.
- Disciplined investing will make you rich: Gurus also love to show how steady investing can turn modest savings into a huge nest egg at retirement. But these calculations assume a healthy market and a lifetime without any setbacks—two conditions that have no connection to the real world.
- Women need extra help managing money: Product pushers often target women, whose alleged financial ignorance supposedly leaves them especially at risk. In reality, women and men are both terrible at handling finances.
- Financial literacy classes will prevent future economic crises: Experts like to claim mandatory sessions on personal finance in school will cure many of our money ills. Not only is there little evidence this is true, the entire movement is largely funded and promoted by the financial services sector.
Weaving together original reporting, interviews with experts, and studies from disciplines ranging from behavioral economics to retirement planning,
Pound Foolish is a compassionate and compelling book that will change the way we think and talk about our money.
Review
"Carl has a wicked way with a Sharpie."
Review
"Carl Richards is the anti-Jim Cramer. He doesn't pick stocks, and he doesn't shout. In wise, calm style, The Behavior Gap teaches us how to rein in the emotional saboteur within us-the voice that leads us to double-down when the market is peaking and to make a panicky exit when stocks are a bargain. Richards shows us that, when it comes to our financial security, slow and steady wins the race."
Review
"Ah, clarity! Carl Richards can see the mistakes that humans-being human- make again and again with money. Then with humor and an I've-been-there nudge he sets them on the right course."
Review
"The Behavior Gap throws light on an important question: How can we think more clearly about money and its role in a happy life? Carl Richards shows how to shape our behavior to invest, save, and spend to foster greater happiness."
Review
"Who says common sense is common? Smart, tactical, practical advice for anyone who has done dumb things with their money."
Review
"Carl Richards's deceptively simple sketches in The Behavior Gap will make you laugh, change your relationship with money, and leave you the wealthier for it. This one is bound to be a classic!"
Review
"Carl has a knack for showing-gently and with charts!-that when it comes to money, most of us are idiots. Carl prods us to master money, rather than letting it master us."
Review
"A brilliant guide to the ways we often trick ourselves into staying poor. Read this before you make your next financial decision."
Review
"If a picture is worth a thousand words, Carl's sketches could change a life! He captures the essence of life and money."
Review
“It's rare to come across a realistic and readable book about personal finance. Most are laden with rosy promises, followed by acronyms and turgid advice. Helaine Olen, a freelance journalist, offers an exception with Pound Foolish.... Its a take-no-prisoners examination of the ways she says we have been scared, misled or bamboozled by those purporting to help us achieve financial security.”
—The New York Times
“Have you ever met anyone who has grown rich just by saving? Probably not. But you may well have met someone who has grown rich looking after other peoples savings. That dark secret lies at the heart of ‘Pound Foolish, Helaine Olens excellent book, a contemptuous exposé of the American personal-finance industry.”
—The Economist
“A cautionary tale that you need to read.”
—The Washington Post
“Dishy dirt on the ‘financialization of American life and the hordes of carrion-pickers who swarm us in the hope of lifting still more dollars from our pockets.”
—Kirkus
“This thought-provoking book alerts us to important issues in todays post-recession economy.”
—Booklist
“A highly readable antidote to the snake oil of the personal finance industry. Suze Orman, watch out!” —GREG CRITSER, author of Fat Land “Wow, does personal financial advice need debunking. And Helaine Olen does it like an old master. Clear, witty, takes no prisoners, and right as hell. Olen will wake you up. There is no financial trick to make you rich.” —JEFF MADRICK, author of The Age of Greed and senior fellow at the Roosevelt Institute “Helaine Olen explains in simple language why most Americans are never going to understand the myriad complexities of investing and borrowing, leaving us all vulnerable to being ripped off in oh so many ways. Combining thorough research with passionate writing, Pound Foolish tells us what to do to protect ourselves and our hard-earned money.” —DAVID CAY JOHNSTON, Pulitzer Prize-winning author of The Fine Print “As Helaine Olen shows in this powerful exposé, ‘personal finance is the ultimate oxymoron. The financial challenges that most Americans face are not simply personal—they reflect the failure of our polices and our leaders to tackle growing middle-class insecurity. And the advice that self-proclaimed money experts provide is far from sound finance. Too often, its snake oil that only adds to the problem.” —JACOB S. HACKER, director of the Institution for Social and Policy Studies, Yale University, and author of The Great Risk Shift “Pound Foolish is a fabulously well-reported, lucid, and witty tour of the train wreck that American finance has become. Olen has the rare ability to demystify the countless swindles and frauds that lately comprise the basic operations of the investment scene. As a kind of bonus, she depicts with verve and intelligence the panoramic freak show of personalities who infest the money scene.” —JAMES HOWARD KUNSTLER, author of The Geography of Nowhere and Too Much Magic “In this gripping account, Helaine Olen pulls out the rug from under the finance industry, and does so in time for at least some of us to find alternative solutions to financial security.” —DOUGLAS RUSHKOFF, author of Life Inc. and Present Shock “The world of personal finance is an economic sideshow filled with illusionists, conjurers, and snake-oil salesmen of every stripe. Thankfully, Helaine Olen has spent enough time inside the circus to be able to guide us wisely and wittily through the hall of mirrors—and come out smarter on the other end.” —JAMES LEDBETTER, opinion editor, Reuters, and author of Unwarranted Influence “The cult of ‘personal finance sells itself—and preys on pocketbooks—with a wildly false message: that American middle class families only have themselves to blame for their economic troubles. With wit, simple math, and relentless sleuthing, Helaine Olen shows how the personal finance industry has led savers and investors astray, and what you can do to avoid its traps.” —ALYSSA KATZ, author of Our Lot
Synopsis
Whenever I tell people about my job as a financial advisor, the conversation inevitably turns to how hopeless they feel when it comes to dealing with money. More than once, they've begged, "Just tell me what to do."It's no surprise that even my most successful friends feel confused or paralyzed. Even if they have a shelfful of personal finance books, they don't have time to make sense of all the information available. They don't just want good advice, they want the best advice--so rather than do the "wrong thing," they do nothing. Their 401(k) and bank statements pile up, unexamined or maybe even unopened.
What they don't realize is that bad calls about money aren't failures; they're just what happens when emotional creatures have to make decisions about the future with limited information. What I tell them is that we need to scrap striving for perfection and instead commit to a process of guessing and making adjustments when things go off track. Of course we're going to make the best guesses we can--but we're not going to obsess over getting them exactly right.
The fact is, in a single page you can prioritize what you really want in life and figure out how to get there. That's because a great financial plan has nothing to do with what the markets are doing, what your real estate agent is pitching, or the hot stock your brother-in-law told you about. It has everything to do with what's most important to you.
By now you may be wondering, "What about the details? How much do I need to invest each year, and how do I allocate it? How much life insurance do I need?" Don't worry: I'll cover those topics and many more, sharing strategies that will take the complexity out of them.
The most important thing is getting clarity about the big picture so you can cope with the unexpected. Maybe you'll lose the job you thought was secure; you'll take a financial risk that doesn't pan out; you'll have twins when you were only budgeting for one. In other words: Life will happen.
But no matter what happens, this book will help you bridge the gap between where you are now and where you want to go.
Synopsis
"It's not that we're dumb. We're wired to avoid pain and pursue pleasure and security. It feels right to sell when everyone around us is scared and buy when everyone feels great. It may feel right-but it's not rational."
-From The Behavior Gap
Why do we lose money? It's easy to blame the economy or the financial markets-but the real trouble lies in the decisions we make.
As a financial planner, Carl Richards grew frustrated watching people he cared about make the same mistakes over and over. They were letting emotion get in the way of smart financial decisions. He named this phenomenon-the distance between what we should do and what we actually do-"the behavior gap." Using simple drawings to explain the gap, he found that once people understood it, they started doing much better.
Richards's way with words and images has attracted a loyal following to his blog posts for The New York Times, appearances on National Public Radio, and his columns and lectures. His book will teach you how to rethink all kinds of situations where your perfectly natural instincts (for safety or success) can cost you money and peace of mind.
He'll help you to:
- avoid the tendency to buy high and sell low;
- avoid the pitfalls of generic financial advice;
- invest all of your assets-time and energy as well as savings-more wisely;
- quit spending money and time on things that don't matter;
- identify your real financial goals;
- start meaningful conversations about money;
- simplify your financial life;
- stop losing money!
It's never too late to make a fresh financial start. As Richards writes: "We've all made mistakes, but now it's time to give yourself permission to review those mistakes, identify your personal behavior gaps, and make a plan to avoid them in the future. The goal isn't to make the 'perfect' decision about money every time, but to do the best we can and move forward. Most of the time, that's enough."
Synopsis
The acclaimed New York Times columnist and author of The Behavior Gap helps readers reframe their decisions about money Financial decisions arenand#8217;t really about money. They're decisions about how we spend our lives. When most financial professionals talk about planning, however, they focus on numbers and technical details. Enter The One-Page Financial Plan.
Too often, the complexity of the planning process paralyzes people before they even begin. Carl Richards sweeps away that complexity and reframes these discussions to focus on the things that actually matter to real people. Rather than identifying arbitrary and impersonal goals (such as trying to beat the market or knowing exactly how much money youand#8217;ll earn years from now), he empowers readers to identify the goals that align with their values. Through a series of steps, he shows readers how simple these decisions can beand#151;once readers are clear about what matters most.
Based on Richardsand#8217;s twenty-plus years of working with clients, The One-Page Financial Plan refocuses readers away from useless financial plans and on the incredibly helpful process of true financial planning. Using his popular sketches that break down big concepts into easy-to-remember visuals, the book is a provocative, even fun, exercise that moves people toward the lives they want.
About the Author
Carl Richards is a certified financial planner and founder of Prasada Capital Management, a portfolio design firm. He contributes to the Bucks blog at
The New York Times and is a columnist for
Morningstar Advisor. Richards appears regularly on National Public Radio's
Marketplace Money, and is a frequent keynote speaker at financial planning conferences and visual learning events. You can find more of his work at behaviorgap.com. He lives in Park City, Utah, with his family.
Visit www.behaviorgap.com