Automatic Wealth Book Review
Call me crazy, but I liked this book. I think this book is perfect for the reader who works a regular job, has read Rich Dad, Poor Dad or the Automatic Millionaire, thought those authors were too vague, and are looking for more details on how to move forward.
For starters, Michael Masterson makes no bones about it, you have to work hard and focus on increasing your income. He offers hundreds of little nuggets to help get you earning a higher salary and ways to build off that income stream throughout the book.
Some of the book was just as vague and outlandish as some parts of Rich Dad, Poor Dad, but in other areas the author really resonated with me. He spends a lot of time focusing on improving productivity and other ways to excel at your existing job and then dabbles in how to expand that into investing, real estate, starting businesses, etc. I personally like the approach because it gives tangible ideas for how the average person can take some actions to gain wealth.
While this isn't the defining book, I think this is a worthy read for those who have read Rich Dad, Poor Dad and wonder "where do I go from here?". I didn't think the book did a great job explaining how to take your income and invest it in other incomes - I'm still on the hunt for better books on creating streams of income.
The book is organized into 6 steps:
1) Face the facts. Basically size up where you are at and that you will need to work hard and change things to meet your goals.
2) Spend less than you earn.
3) Develop wealthy habits.
4) Radically increase your income.
5) Get richer while you sleep. Invest in businesses, real estate, stocks, etc.
6) Retire early. You don't retire; you just gain the flexibility to do what you want.
Here are some nuggets from reading the book:
-8 habits of wealth builders.
-The average multimillionaire owns less home than you think.
-You can live rich for less than you think. Buy the most expensive mattress available. This was just an example of how there are some material things that you don't have to scrimp on - you can buy the same mattress that the richest person in world sleeps on for just a few thousand so why would you buy anything less than the best.
-Get to work earlier rather than sleeping late. I have always been a sleep in, stay late person whereas most at work get in early and leave early. The author suggests that staying late makes you appear disorganized and arriving early makes you appear industrious and organized. I never thought of it that way.
-The most financially valuable skill is sales.
-Become wealthy is easy as 1) boosting your income, and 2) use that income to invest in several businesses.
Related in Personal Finance Books:
Four Hour Work Week Book Review (Dec 06, 2010) When the 4-Hour Workweek came out back in 2007 with a lot of buzz I was interested in taking a look. However I was off to China on my international assignment and getting married so reading the 4 Hour Work...
The Big Short Book Review (Sep 23, 2010) I just finished reading Michael Lewis' latest book The Big Short. The book delves into the lives of 3 groups of small time money managers that were able to see the coming collapse of the subprime mortgage bond market...
Stop Acting Rich Book Review (Mar 17, 2010) Back when I was in college a department head gave me a copy of The Millionaire Next Door as a thank-you gift for a project I helped with. This book had a profound effect on me at the time...