Smart Women Finish Rich was the first financial planning book I ever purchased, read, and actually used. I bought it in my early twenties, when I was finally ready to make some changes in my financial life – I had been so anxious about the state of my finances that I was finally committed to making some changes.
Now, years later I still go back to this powerful book, which I consider a staple in my financial management diet. I re-read chapters and absorb the lessons, and try to put a little finesse into the details.
When I first read it I thought I was so clever – because the book really appeals to the emotional side of managing your money. David Bach wrote the book with a very positive emotional angle that I think seriously appeals to women, and motivates them. It did for me anyways.
About Smart Women Finish Rich
It’s surprisingly easy to read. When you read it, it’s like you’re having a casual conversation with David himself. He’s charming, and caring, and flattering. He makes you feel like a genius – just for having picked up the book and reading it. And while you’re being shmoozed so thoroughly, you actually learn a lot of things about money and personal finances.
He peppers his book with anecdotes about his grandmother that are very quaint and charming, and that actually sound sincere. The most important reaction from all of this buttering up – is that you actually want to take action. I felt like following his advice would obviously work, because he’s an expert, and his manner of writing is so sure and confident.
The Finish Rich Steps
He touts nine big steps in his book, which are absolutely fundamental to your financial prosperity, and you could even go as far as to say your life’s happiness.
Step #1 – Learn the Facts – and Myths – About Your Money
Step #2 – Put Your Money Where Your Heart Is
Step #3 – Figure Out Where You Stand Financially…And Where You Want To Go
Step #4 – Use The Power of the Latté Factor
Step #5 – Practice Grandma’s Three-Basket Approach
Step #6 – Learn the Ten Biggest Mistakes Investors Make and How to Avoid Them
Step #7 – Raising Smart Kids to Finish Rich
Step #8 – Follow the 12 Commandments of Attracting Greater Wealth
Step #9 – FinishRich Success Stories
My Call to Action
After reading the book – actually, while I was still in the middle of it – I went out and started to do exactly what he suggested. I started to figure out where all of my money was, and where it was going. I got all of my records straight – and in doing that I realized that I had been overpaying to an institution $450 a MONTH, and had been for 14 months. So – I got my money back. That was worth the price of the book hundreds of times over.
How did that happen, you are probably asking. Well, years before I had those payments taken off of my pay directly. And when my service ended, they didn’t stop the payments – and I didn’t notice, because I never looked at my paycheck! I didn’t know where my money was going.
When I realized that David’s first step to being a Smart Woman was so fruitful, I took the second step. I set up an RRSP account and made those payments automatic. My goal was to save up enough to buy a house with the Home Buyers Plan. (For more info – read my post on the Home Buyers Plan)
Then, three years later, thanks to David’s fantastic advice that really got me off my ass – I achieved my dream of home ownership. Now I’m part of the mortgaged majority!
Use the Exercises and Worksheets
I filled out the exercises and worksheets when I first got the book, and when I re-read it a few months ago I noticed how some of my goals have changed, but most of them have stayed the same (for example – I don’t necessarily want to do a Master’s in Political Studies anymore – but I do still want to go to graduate school, and take and MBA perhaps.) That’s the advantage of planning your finances around your fundamental beliefs and values. Those don’t really change, even if you short term goals do.
The worksheets that help you figure out where all your money is coming from, and going to, are so helpful. But not only that – it helped me be a real grownup. I bought myself a filing cabinet, and started to organize ALL of my important papers just like adults do - like university correspondence, insurance papers, medical info, vet bills, phone bills, Hydro – you can organize anything once you have the system in place. Now I’m organized like a fox. And on Saturday mornings when my husband sleeps in, I can do a little filing - totally undisturbed.
Why It’s So Important For Women
My husband saw Smart Women Finish Rich by my bedside, and took a look. He said to me “why don’t you get Smart Couples Finish Rich? It worries me a bit that you’re doing this without me”. He was totally right, and I did get the book for couples. But, I bought Smart Women Finish Rich before we met, and I will stand by the principles to the end!
I explained to him the lessons I learned through the book – that most women are sadly under prepared for their retirements, and end up living below the poverty line. Historically, women have relied so much on men (fathers, husbands, sons) for their care in old age, they can be left disappointingly under-prepared when old age comes.
The reasons for this are many:
- women statistically make less than a man, even for the same work
- women are in the workforce for a shorter amount of time (leaving to have children, raise families, or take care of elderly parents)
- women in lower-paying jobs don’t have the benefit of pension plans
- women outlive men by an average of 6 years, and therefore have to stretch their smaller retirement incomes farther than men do
So, my justification to sticking to my worn out copy of Smart Women Finish Rich, with writing in the margins, tabs, and dog ears, is that I had to take care of myself first. And then I could enter into our partnership as an equal, and equally prepared for our future.
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