Money Talks #1: Three Books About Money

Lately my special interest has been personal finance. This has been sparked by going from ‘just getting by’, to having a reasonable household income. My aims are 1) to get rid of toxic beliefs and heal my relationship with money and 2) to manage our money responsibly so we are working towards achieving our financial goals.

I am starting a blog series called Money Talks. This first post is a review of some books I have read recently about money.


The Barefoot Investor: The Only Money Guide You’ll Ever Need, by Scott Pape

Scott Pape is all about making financial freedom accessible and achievable for everyday Australians. I interpret his idea of financial freedom as: 1) not being in debt 2) having a streamlined money management system and 3) having a comfortable retirement.


  • Scott Pape demystifies financial concepts that can seem too confusing to even contemplate
  • Writing style is engaging
  • Instructions are clear and easy to follow
  • Specific and relevant to an Australian context


  • His direct style makes his steps easy to follow, but can be interpreted as condescending, especially for those who don’t like being told what to do. If that’s you, my suggestion is to read the whole book through first and then go back and apply his instructions as you want, modifying them to suit your own purposes
  • He is very intentionally inclusive but can sometimes be a bit blokey

I really enjoyed this book. When I finished reading it, I felt empowered. I sensed freedom on the horizon. I even wrote myself a Future Me email for a year into the future, detailing the financial successes I saw for myself and my family.

A friend of mine described The Barefoot Investor as like bumpers for your bowling. If you apply his steps, you won’t go backwards financially and you will set yourself up for your future. ‘Is that not enough?!’ you might ask. Well, some aim for more, which brings me to the next book I read…


Your Money Or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence (Fully Revised and Updated for 2018), by Vicki Robin and Joe Dominguez

Beyond financial freedom is financial independence. Financial independence means not having to work for a living, or as author Vicki Robin(1) puts it, “work for a dying”. Her program aims to increase mindfulness about spending so that you are spending in line with your values and in proportion to your ‘life energy’, which is the time you spent earning the money. Once you are spending less than you earn, you can use your savings to eliminate debt, then invest, and eventually live off passive income(2).

The nine steps are not for the faint hearted. For example, the first step is to calculate how much money you have earned in your life so far, including cash jobs, and then calculate your net worth, including every item you own and what you could sell it for. But what the book is asking of the reader is proportional to what it is promising. Financial independence is a big aim. I would expect the process to take a lot of work.


  • Like Barefoot Investors steps, YMOYL’s steps are clearly explained. They are a lot of work to carry out, but they are easy to understand
  • Her writing style is invitational rather than dictatorial – the opposite to Scott Pape’s in The Barefoot Investor
  • She explains ‘why’ a lot (also different to The Barefoot Investor)
  • She uses lots of examples of actual people who have followed this process. This includes people from diverse backgrounds who have followed the process in their own ways


  • Sometimes this book goes into way too much detail, especially in the first chapter when she is explaining the disastrous effect of consumerism (although it could be that the material was all familiar to me)
  • The final chapter, about investing, needed updating for a contemporary context

Financial Independence is not an immediate financial goal of mine, but I was hooked by the promise of transforming my relationship with money. I believe that following the instructions in this book will help me in my aim to heal my relationship with money.


Millionaire Next Door: The Surprising Secrets of America’s Wealthy, by Thomas J. Stanley and William D. Danko

This book is different from the other two in that it is not a step-by-step guide to improving your finances. It is a study of self-made millionaires in the USA and how they got that way.

We often think of millionaires as people who have lavish lifestyles. This book busts that myth. Most millionaires live in modest homes and hunt for bargains. The people living large are likely to be high in earnings but low in wealth(3), or they are up to their eyeballs in debt. Or both.

The authors coined the terms “under-accumulators of wealth” and “prodigious accumulators of wealth”. They have a formula for how much wealth one ‘should’ have accumulated based on aged and earnings. The millionaires next door are prodigious accumulators of wealth. This means that they save/invest more than is expected for their age and level of income. An under-accumulator of wealth is someone who has less wealth than could be expected from their age and income, according to the formula.

Here are some profile points on the average millionaire next door household (please note the gendered language is from the book, not how I would express it):

  • Likely to be a married couple with no history of divorce
  • In 70% of cases the husband earns majority of income and wife works part-time or is a homemaker
  • Wife is more frugal than husband (who is also frugal) and meticulously plans and budgets(4)
  • They are often self-employed, often in business that does not come with a high cost of living. For example, a caravan park owner might make as much money as a solicitor, but goes to work in a basic uniform rather than expensive suits/dresses


  • This book is a great concept, original and very helpful for reorienting ideas about what it means to be financially secure and how people get there
  • As well as the basic concept, the part about whether/how to give your kids money was very helpful and interesting (summary: don’t bail your kids out; instead share with them the skills and habits that made you wealthy)


  • There was way too much detail. I feel like it could have been a 2500-word article rather than a 272-page book. Many books have paragraphs that should have been cut, but this book has whole chapters that don’t need to be there. There was a whole chapter about what kind of cars the millionaire next door buys, which could have been covered in a paragraph (or a word: second-hand).
  • The book was not well-structured
  • There was a judgmental tone towards under-accumulators of wealth
  • I didn’t agree with the tax-avoidant section. Paying tax is an obligation of citizens
  • A lot of the book was only relevant to an American context, especially in relation to their tax system

I’m glad I read this book but it was such a struggle to get through. I would not recommend it. I hope that my summary has provided you with everything you could have learned from the book so you don’t need to read it. Readers, if you have read this book and you feel I have left some important points out, please let me know.


Next in the series:

Money Talks #2: What I learned from reading the three books about money

Money Talks #3: Steps I have taken so far


(1) This book was originally co-authored, but the edition I read was re-written by just the one author, so for simplicity’s sake I refer to a single author.

(2) Passive income in this context is cash flow from investments. Once your investment is big enough, you can draw cash from it while still leaving enough that the investment can grow. A common rule of thumb is that you can safely withdraw 4% a year from your retirement fund. So for example, if your yearly expenses are 50,000 you will need $1.25 million in investments.

(3) Wealth is defined as savings or investments. This is money that is building up through interest/returns, rather than being spent.

(4) Some millionaire households do not budget as such, but instead save/invest a high percentage of their income and then live off the rest (barefoot investor style).

2 thoughts on “Money Talks #1: Three Books About Money

  1. Pingback: Money Talks #2: Three things I have learned from books about money | Emmeline

  2. Pingback: My Reading Life: July-December 2019 | Emmeline

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