How to Finance Books Book Review
Your Money Your Future by Frances Cook
There are some very good financial how-to books written by New Zealand authors which are a good read. If you come from a country outside of New Zealand then maybe you can find these listed on Ebay. You will almost certainly find these listed on the New Zealand auction site trademe. One such author whose books are worth reading is Frances Cook.
Frances is a top-rated pod caster and personal finance journalist. Her book, YOUR MONEY YOUR FUTURE is worth a good read. “The best time to plant a tree was twenty years ago. The second best time is now.” according to Frances. The book contains practical advice which anyone can use to achieve better financial outcomes.
There are several interesting points made by the author; some interesting ones being:
The 4 percent rule
This is how much you can spend on your savings per annum after you retire from working.
Income – expenses = savings
You just need to create a gap between your income and your expenses whichever way suits you, in order to save money; “a very simple equation”says Cook.
Chapter nine is titled, “To understand money, think of it as time.” The more time you have on your side, the more you want to invest in risky assets. It is not risk such as investing in a new cryptocurrency which may make you a packet one year only to lose it the next. Everything comes down to time. It is the key to unlocking the key to what you do and when. Older people need more cash on hand, because they’re in the spending phase of life.
Debt was another topic covered. “Spending money you don’t have is called debt”, says Ms Cook. “It is a monkey on your back. Your debt is standing between you and a better savings rate. The money you can’t have today as a debtor has to pay for the life you lived in the past. The debt needs to go first so that the future doesn’t keep being held back.”
Without knowing your personal situation I believe that even if you are in debt it is still important to contribute to your country’s retirement scheme in order to take advantage of the incentives your government provides, not to mention the captain gains on your money but it is a balancing act and as Frances Cook points out. Debt is a hindrance to your financial well-being and has to go beginning with the debt which you are paying the most interest on.
increasing your income through side hustling is covered. One piece of advice given is to look at other industries and see if you can adopt and repurpose the idea to your own area.
Also covered in the book is retirement and Frances says “You are either retiring from something or retiring to something.”
What do you do with your life if you don’t need your job anymore? It might be volunteering for a charity or community group. If you focus on retiring from something, you focus on what you are leaving behind. If you’re retiring to something instead, you have an end goal in sight. You may have a business you want to launch in an area of your passion. You are creating a life, not just quitting the one you currently have. If all you are focusing on is retirement from the life you had then you will find life very empty afterwards.
Frances Cook really puts things into perspective and asks a few hard questions. At the end of the day, a book such as this, may have a lot of useful snippets of information but it really is up to each individual to establish what their personal goals are and incorporate ideas from the book which are appropriate to your situation.
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