Every Friday I review a book or movie. Check out a complete list here.
When Richard Evans was a little boy, his father fell down a stairwell, shattering the bones in both of his legs. The injury left his dad unable to work for a year, forcing Richard’s parents to sell their home and squeeze their family of 10 – two adults, eight children — into a three-bedroom rental.
Richard vowed to become wealthy during that tough year. He wanted to give his children the financial security that he never had.
He didn’t know it at the time, but he had just taken the first of five steps towards wealth. The first step is the simple act of choosing to be wealthy. Believe it’s possible; commit to making it happen.
Evans’ book, The Five Lessons a Millionaire Taught Me, describes the steps that lead to wealth:
#1: Decide to Be Wealthy
“A dentist friend once told me: ‘Those who don’t think about their teeth (early in life) are those who later in life spend the most time thinking about them.’ It’s no different with money.”
… “the people I know who are the most obsessed with money are not millionaires … (they) are the ones who are living paycheck to paycheck” …
“To be in great fiscal health is very much like being in great physical health: it allows you to do more and be more, and it permits you to live your life free of constant pain and bondage.”
#2: Take Responsibility for Your Money
This step involves knowing three things:
- Know how much money you have. What’s your net worth?
- Know where your money comes from. Track every tip, bonus, and interest payment. Record the small amounts that normally slip through your fingers, like checks you get for your birthday, dividends from your index funds, and money you get from rewards credit cards.
- Know where your money is going. Your car, for example, doesn’t just cost the sticker price; it also costs insurance, repairs and registration fees.
#3: Keep a Portion of Everything You Earn
He recommends keeping a minimum of 10 percent of your regular paycheck, plus 90 to 100 percent of your side income.
#4: Win in the Margins
“The most money I’ve made in my lifetime was on a side project,” he said. “(But) it wasn’t my first venture. It was my fourteenth.” In other words, keep your day job, but always look for ways to earn more on the side.
#5: Give Back
Generosity feeds the soul. Give financially to good causes that have a proven track record of properly handing money. In addition, teach others the principals of becoming wealthy. It’s through teaching that we learn.
Should I Read This Book?
This is a quick read, with less than 100 pages of large font. I finished the book in one sitting.
The lessons are basic, and they’re designed to be inspirational / motivational rather than informative. In other words, this book is designed to get a financial novice excited about the possibilities that lay ahead.
This Book is For You If: You want to give a gift to someone who isn’t interested in money. This is a motivational book for beginners.
This Book is NOT For You If: The intended reader is an “advanced student” of money or is looking for specific, actionable information, such as how to set up a Roth IRA or diversify a portfolio.
The 5 Lessons a Millionaire Taught Me is only $5.98 on Amazon, with free shipping. Check it out!
Paula,
Great write up. That’s my problem with this book, it’s not very actionable. I’m at the point where, I need details rather than inspiration.
@Dominique – You know what you want, which is probably 90 percent of the battle. Most people struggle to identify what they need. You’ve done that. Now all you need to do is focus on that target. Given your success with real estate and other ventures, you’re doing a pretty darn good job.
I really love your Friday’s review, Paula. “Know where your money is going” is more important than people know. But I like the point that you made about keeping your day job and earn on the side. Far too many people make the leap from leaving their day job to an entrepreneur only to fail because of lack of risk management.
Thanks for the review
… “the people I know who are the most obsessed with money are not millionaires … (they) are the ones who are living paycheck to paycheck” …
This is so true. What’s worse is that many (if not most) of the people who feel this way also believe that the wealthy are evil by default. It’s an evil cycle of beliefs that they’re caught in.
Probably wouldn’t be for me but I totally agree that you should keep a portion of everything you earn or else you’ll be ready to retire and have nothing to retire on.
Love the concept! Definitely going to check it out!
i would recommend, associate with others that you want to be like. if its being a millionaire, hang out with other millionaires. you will pick up their habits and learn how they did it. chances are, opportunities will be presented to you through them.
robust returns on investments are how you join the 1% club
@investlike1percent — Being around like-minded people definitely helps you grow more successful, wealthy and able to live free.
Hmmm, sounds interesting. I might have to read it. Also Paula, you may want to look into a new book that recently came out called, Platform, by Micheal Hyatt. I’ve read several blogs about it, and he had some sort of promo (which I missed) to give away even more informational items. Needless to say, there is a positive buzz around it. I’ll be ordering it in the next week or so!
@Chante — I’ll add it to the list! Thanks for the recommendation!!
My husband bought the book and obliged me to read it. I love the tips on how to boost family income, family budget saving tips, and lots of inspirational quotations. Truly inspirational for people who wants to have the financial freedom.
Hmm, interesting. I really like the quote about people who spend all of their time thinking about their teeth are those people who didn’t take care of them when they were younger. It makes me want to put more into my retirement account.
@Daisy — It makes me want to spend more time caring for my teeth! I’m long overdue for a routine cleaning ….