If you’ve ever bought a personal finance book, watched a TV show about stock picking, listened to a radio show about getting out of debt, or attended a seminar to help you plan for your retirement, you’ve probably heard some version of these quotes:
“What’s keeping you from being rich? In most cases, it is simply a lack of belief.” —SUZE ORMAN, The Courage to Be Rich
“Are you latte-ing away your financial future?” —DAVID BACH, Smart Women Finish Rich
“I know you’re capable of picking winning stocks and holding on to them.” —JIM CRAMER, Mad Money
They’re common refrains among personal finance gurus. There’s just one problem: those and many similar statements are false.
For the past few decades, Americans have spent billions of dollars on personal finance products. As salaries have stagnated and companies have cut back on benefits, we’ve taken matters into our own hands, embracing the can-do attitude that if we’re smart enough, we can overcome even daunting financial obstacles. But that’s not true.
In this meticulously reported and shocking book, journalist and former financial columnist Helaine Olen goes behind the curtain of the personal finance industry to expose the myths, contradictions, and outright lies it has perpetuated. She shows how an industry that started as a response to the Great Depression morphed into a behemoth that thrives by selling us products and services that offer little if any help.
Olen calls out some of the biggest names in the business, revealing how even the most respected gurus have engaged in dubious, even deceitful, practices—from accepting payments from banks and corporations in exchange for promoting certain products to blaming the victims of economic catastrophe for their own financial misfortune. Pound Foolish also disproves many myths about spending and saving, including:
Small pleasures can bankrupt you: Gurus popularized the idea that cutting out lattes and other small expenditures could make us millionaires. But reducing our caffeine consumption will not offset our biggest expenses: housing, education, health care, and retirement. Disciplined investing will make you rich: Gurus also love to show how steady investing can turn modest savings into a huge nest egg at retirement. But these calculations assume a healthy market and a lifetime without any setbacks—two conditions that have no connection to the real world. Women need extra help managing money: Product pushers often target women, whose alleged financial ignorance supposedly leaves them especially at risk. In reality, women and men are both terrible at handling finances. Financial literacy classes will prevent future economic crises: Experts like to claim mandatory sessions on personal finance in school will cure many of our money ills. Not only is there little evidence this is true, the entire movement is largely funded and promoted by the financial services sector.
Weaving together original reporting, interviews with experts, and studies from disciplines ranging from behavioral economics to retirement planning, Pound Foolish is a compassionate and compelling book that will change the way we think and talk about our money.
The worth of the personal finance industry is inversely proportional to its ubiquity, according to Forbes.com blogger Olen in his breezy romp through recent financial history. According to Olen, given today s increasing income inequality and shaky employment prospects, a secure livelihood or retirement is a chimera. Olen s fast-paced narrative focuses on the rise of media celebrities and financial pundits who assure us: You can do it! What we can do is sign up for overhyped and overpriced investment seminars and services, promoted largely by the powerful motivator of fear. Such luminaries as Suze Orman, Jim Cramer, Robert Kiyosaki, and Peter Schiff may be household names, but their (often self-serving) advice did not prevent American retirement vehicles from losing $2 trillion in 2007 2008. The proposition that media icons are also self-promoters will astonish no one, and Olen s frequent iteration of this point diminishes the value of her observations. Though her intention is to provide an expos , not financial advice, her own observations are commonplace. One can enjoy her glimpses of the world of financial celebrity while remaining skeptical about the scope of her proposed remedy.
Customer ReviewsSee All
Great book so far.
This is a great book. I have been telling people this for years. I don't understand the negative reviews. This book doesn't say it is an investment book. If you want to learn how to invest then get off your lazy butts and learn. NEVER rely on a book put out by some scam artist to do it for you. Great way of losing your money. The negative reviews are from lazy people who want others to do it for them. Excellent book and it's about time someone wrote about this subject!
Don't buy this book!
This book is nothing more than a slanted biography of today's most prominent so-called financial experts (Orman, Bach, Ramsey) from a free lance reporter with little to no education or experience in anything financial. The author attempts to save the world from the teachings of these "experts" but offers no formable advise to the reader as to who or what they should pursue for honest advise on all things financial. Chapter after chapter of long winded history lessons and skewed bios leads the reader to nowhere.
Wonderful insights into a dismal industry!