It seems that more and more of my friends are moving to Macintosh. This is a Good Thing. Macs are not perfect, but for most users they’re the best choice. They’re safe, reliable, and accessible. Best of all, they’re a pleasure to use.
As these friends change platforms, though, they find themselves asking: “Which software should I use?” I’ve been back on Macintosh for nearly three years, and have explored a lot of the available software, and am now willing to make recommendations.
(Please note that the programs I mention aren’t the only (or even the best) options. They’re merely the options I recommend.)
Web Browser
Safari is the default Macintosh browser, and it’s a good one. It’s my favorite web browser, actually, on any platform. It’s quick and flexible, with tabbed-browsing and a built-in google search bar. Safari’s biggest weakness is printing. On Internet Explorer for the PC, you’re able to print a selection from a web page. You can’t do this from Safari, and, quite frankly, it sucks. (Free.)
Firefox,the best browser option for the PC, is also available on the Mac. Firefox is very similar to Safari, but more extensible. You can download addons to change the browser’s functionality. Firefox is a great option, but I happen to prefer Safari. (Free, open-source.)
E-Mail Client
Apple Mail is the best of a marginal field. It’s included with every Mac and, for the most part, does a fine job. It features lightning fast searches (best e-mail search I’ve ever used), custom filtering, and an elegant interface, but the damn thing is far too buggy. It crashes often (without loss of data, fortunately), and a couple times a year it just stops working altogether. Apple Mail is good except when it isn’t. (Free.)
Eudora is the same e-mail application that many people use on the PC. It does a fine job, but it’s just, well, ugly compared to other Macintosh applications. The interface is less-than-ideal, and the search is just okay. Still, it’s a fine alternative. (Available in three modes: free but feature-limited; free and full-featured but with ads; and $50 paid mode.)
Some people swear by Mailsmith. I swear at it. After using Mailsmith for a year, I’m afraid I have to recommend against using it. Its user-interface is fine, and it offers a lot of options, but everything else is a mess. It’s slow. (I mean really slow. Sorting or searching with just a couple thousand messages in a mailbox is unbearable.) It’s a nightmare to find and change a preference. Support is unhelpful. And it’s expensive. If you’re willing to fuss with the program, it’s probably great. (Why else would people praise it?) But if you want to fuss with things, you ought to be on a PC. Me? I just want my mail program to work. ($100 and an infinite amount of patience. Fully-functional 30-day demo available.)
Office Suite
Most Macs (all Macs?) ship with Appleworks, a basic office application similar to Microsoft Works. For most people, this is all the office application they’ll ever need. It doesn’t have all the features of Microsoft Office (though it will read MS Office files just fine), but I’ve never really noticed. It does what I need. Jeff notes that he uses AppleWorks a lot, and is generally content with it. It’s not ideal. (Free.)
If you need Microsoft Office, it’s available. I never crave Word, though sometimes I crave (and use) Excel. Excel is rather keen. ($400.)
Text Editors
As I’ve mentioned many times in the past, I don’t use a word-processor. I use text-editor. What’s the difference? A text-editor doesn’t have fancy features like multiple fonts and page layout options and rudimentary graphic design tools. A text-editor is just a program for writing. I left the world of word-processing six or seven years ago, and I’ve never looked back. The Mac ships with TextEdit, but there’s a better option.
Most Macintosh power-users sing the praises of BBEdit, which has been a mainstay on the platform for over a decade. I’m not a huge fan of BBEdit. Like Mailsmith (it’s made by the same company), it suffers from an overwhelming options screen. The latest version of the program (version
seems to be a step sideways. Some nifty new features were added, but at the expense of speed. ($200. Fully-functional 30-day demo available.)
Instead, I recommend the stripped-down version of BBEdit, which is called TextWrangler. If this had been available when I bought BBEdit, I could have saved myself a chunk of cash. (Free.)
Image Editor
Apple has made a big deal about iPhoto, and I’ve been impressed at some of the things that Jenn uses it for, but I’ve never been anything but frustrated by it. It’s slow. It’s cumbersome. It’s feature-set is anything but robust. (You can’t even re-size a photo!) It’s a good way to organize your photo library, I suppose, but that’s about it. (Free.)
Many Mac users love the venerable GraphicConverter, a $30 shareware program that allows for basic image manipulation. The geekier set advocates the free, open-source GIMP. I’ve used GIMP on both Windows and Linux, though, and have never been impressed.
For image manipulation, I use Photoshop Elements, a stripped-down version of Photoshop that has a wealth of features for the average user. The latest version (3.0) isn’t very good, though. I regret having spent $80 on it. It’s slow, buggy, and features some mind-numbingly stupid programming. It’s a good choice if you can’t find 2.0, but otherwise skip it. I’ve uninstalled Photoshop Elements 3.0 on my computers and am using 2.0 instead. Photoshop Elements 2.0, if you can find it, is a pleasure to work with, with some clever intuitive features that have just disappeared in the latest version.
Music Jukebox
Macintosh ships with my favorite music jukebox: iTunes. As with most Apple products, iTunes features lightning-quick searches, an excellent user-interface, and great organizational capabilities. I used to use WinAmp on the PC, but iTunes is superior to it in nearly every way. (Free.)
Movie Player
Every Mac ships with two movie-playing applications: DVD Player for watching DVDs and QuickTime for watching other video files. Unfortunately, these aren’t the only video players you’ll need.
You’ll also need Windows Media Player (a free download from Microsoft) and the fantastic free open-source VLC. VLC is a must-download app. It’s my default media-player. If it doesn’t work (which is rare), I fall back on Windows Media Player or QuickTime.
It seems strange to need so many different media players; I console myself with the fact that I needed just as many in Windows. (All of these applications are free.)
Other Applicatons
Here’s a list of other useful applications that the Mac ships with by default: Address Book (which integrates with Apple Mail and other Mac apps), iCal (which is notoriously buggy, but still useful), iDVD (for burning DVDs, which I never do), iMovie (for making your own movies, which I rarely do), iSync (for syncing data on multiple Macs — I use this all the time), and iChat (for internet chat, which I rarely use).
And here’s the meat of this entry, the little Macintosh utilities I can’t live without:
Acquisition
I’ve used a half dozen file-sharing clients from Napster to BearShare to LimeWire to Kazaa to Kazaa Lite. None of them come close to touching Acquisition for quality of user interface. As a bonus, Acquisition is fully integrated with iTunes. This application is beautiful. (Free download. $17 payment requested.)
Audacity
Don’t let the ugly interface scare you; Audacity is a handy app for working with audio files. It’s a free, open-source with which you can record live audio (like birds in the yard); convert tapes and records into digital recordings or CDs; edit sound files; cut, copy, splice, and mix sounds together; and more. (Free, open-source.)
BitTorrent
I’ve already ranted about how I would watch almost no television if it weren’t for Netflix and BitTorrent. Using various directories, I’m able to find “torrents” for download, and thus I watch television programs I otherwise would miss. Network executives aren’t happy about it, but would they rather have me publicize their programs in my weblog after downloading them via BitTorrent, or would they rather have me not watch at all? (Free, open-source.)
Lightbox
Like iPhoto, but better. Lightbox is an image-management program for serious photographers. It works with RAW image files, keeps track of thumbnails, and, best of all, doesn’t make you keep all your images in one directory. ($25, fully-functional demo available.)
MacGourmet
I love to cook, but I do a terrible job at keeping my recipes organized. I’m always asking Kris things like, “Where’s that recipe for Thai tuna salad?” MacGourmet solves that problem. Or it would if I ever got all my recipes entered into it. The program even has a keen companion website with recipes and more. ($25, time-limited demo available.)
NetNewsWire
This app allows you to read syndicated feeds. That may be gibberish to you. An RSS (or similar) feed is basically a plain-text version of, say, this weblog, which can be acquired by various applications, including NetNewsWire. NetNewsWire lets you subscribe to these feeds, essentially tracking to see when your favorite sites and weblogs are updated, then displaying the new stuff for you to read. It’s very handy. ($25, fully-functional 30-day demo available.)
Quicksilver
Ah, Quicksilver. I’ve barely begun to use this little app — loudly advocated at 43folders — and already I sense its power. It’s essentially an operating system accelerator: press option-space and type the first few letters of a program, or the first few letters of a URL, or the first few letters of a document name, and Quicksilver opens it for you. Very handy. Here’s an excellent introductcion to Quicksilver. (Free.)
Unison
Some of us are still on Usenet. (When I first started using the internet, Usenet was the internet: there was no world-wide web.) ($25, fully-functional 15-day demo.)
SpamSieve
If I could have only one third-party Macintosh application, it would be SpamSieve. SpamSieve is the most effective spam filter I’ve ever used. It integrates flawlessly with every e-mail client I’ve used. It just works. (I only have two very, very minor complaints: its icon lives in the dock, and it gives me a modal dialogue box after each (frequent) program update.) ($25, and worth every penny.)
Transmit
How do I move files back and forth on my web site? With ftp, of course. There are plenty of free ftp clients available, but none of them offer the features and elegance of Transmit. Transmit is the best ftp program I’ve ever used on any platform. Most people don’t need an ftp client; me, I can’t live without one. ($30, fully-functional 15-day demo.)
WeatherPop
This handy little menu-bar app displays weather forecasts. It used to be available for $8 from the developers, but their web site is gone. I can’t find it. I think the above link will give you a free fully-functional demo, but I’m not sure.
WireTap
This little app lets you record sound from any source, even realaudio or DVD audio. WireTap captures the sound as it’s routed to the speakers. Ambrosia used to have a free version available, but they’ve updated the app and are charging for it now. (Wow. I just installed WireTap Pro. It’s got Windows-level of crap in its folder after installation. Not a good sign.) ($19, though the old version is free if you can find it.)
I’m hesitant to recommend anything from Real Networks knowing how insidious their software is on the PC, but from what I can tell their various media players are actually fairly innocuous (even useful!) on a Mac. The latest version is Real Player 10, but I’m still using RealOne Player and am quite happy with it.
I’m sure there are scores of other great little Mac apps out there that I haven’t discovered yet. One great thing about Macs is that they’re useful out-of-the-box. Throw in a couple of the above apps and they kick ass.
On 02 June 2005 (04:29 PM),
Kris said:
On 02 June 2005 (07:43 PM),
dowingba said:
On 02 June 2005 (09:16 PM),
Jeff said:
On 03 June 2005 (08:26 AM),
Tammy said:
On 03 June 2005 (11:03 PM),
Dana Johnson said:
Note: foldedspace.org died recently, and is gradually being reconstructed. This entry has moved. Its new URL is http://www.foldedspace.org/weblog/2005/05/getting_things_done.html. The 10 comments from before the move can be found here.
“So, basically, it’s just a bunch of lists?” — Jenn
I spent the weekend implementing the system found in David Allen’s Getting Things Done. Rather than explain the system, I want to tell you how I implemented it. However, since I didn’t follow things to the letter, and since most of you are probably unfamiliar with this, a brief summary is probably in order. The following has been significantly simplified.
THE ART OF STRESS-FREE PRODUCTIVITY
Our lives, says Allen, are filled with Stuff. Too much Stuff. We think about this Stuff, we worry about this Stuff, we never get all the Stuff done that we need to do.
His solution is simple: collect all the Stuff in a Collection Bucket. When all the Stuff is in one place, process the top item in the Bucket. When the first item has been processed, move on to the second. Process everything in order until there’s nothing left in the Collection Bucket.
How are items processed? Whenever one takes an item from the Collection Bucket, one asks: “Is this actionable?” In other words, “Is this something that I need to take care of?”
If the item is not actionable, one should (depending on its nature):
- toss the item in the trash,
- file the item for future reference, or
- place the item in a regularly-reviewed tickler file for possible future action.
If the item is actionable, one should (depending on its nature):
- do it, if it’s only going to take a few minutes,
- delegate it, if it’s somebody else’s responsibility, or
- defer it.
Using this system, many items are done immediately, while many other items are deferred. Deferred items may be:
- placed on a calendar if they must be done at a specific date and/or time, or
- put on list of Next Actions if they’re things that need to be done ASAP
There’s a special subset of actionable items called Projects. These are multi-step events. Each Project gets its own file, and the Next Action for each Project is placed in the Collection Bucket.
After the system is erected, one should empty the Collection Bucket(s) once a week (or as often as necessary). That’s it. That’s the system.
Here’s a graphical representation:
An alternate graphical representation:
There are other nice Getting Things Done flowcharts out there. I’ve got a pretty one hanging above my desk now.
APPLYING THE SYSTEM FOR PERSONAL USE
This ideas in this book are designed for business use, but they’re easily applied to one’s personal life. That’s just what I did last weekend.
Here’s how I got things done:
Preparation
I made a trip to an office supply store to pick up: file folders, an automatic labeler, four 12×12 tiles of cork, a nice wooden inbox, thumbtacks, scotch tape, and a few other items.
Collecting Stuff
I gathered together all of my Stuff, both physical and mental, and piled it on the kitchen table.
To gather the physical Stuff, I walked from room-to-room with a box, into which I shoveled all the Stuff I could find (e.g. magazines, photographs, junk mail, to-do lists, letters, etc.).
To gather the mental Stuff, I walked from room-to-room with a stack of index cards, onto which I wrote all the Stuff that occurred to me (e.g. put away clothes, clean cat food area, hang painting on guest room wall, organize DVDs, prune laurel from back porch, etc.).
Sorting Stuff
When all this Stuff had been collected in one spot (which took several hours), I began to process it.
Mostly the Stuff was easy to process. I just started with what was in front of me, picked it up, and asked myself what the item was and what needed to be done with it.
If it was something I could deal with in just a few minutes, I dealt with it. (For example: books that needed to be shelved.)
If it was something that needed to be dealt with soon, but that would take longer than just a few minutes, I set aside in a Next Actions pile. (For example: cancel cell phone.)
If I no longer needed the item, I threw it out. (For example: house flyers from last spring.)
If it was something that I wanted to keep for Reference, I made a new file folder (labeling it with my handy automatic labeler). (For example: all of the various songlists I jot down for future CD mixes.)
If it was something for somebody else, I put it in a Delegated pile. (For example: anything related to the bathroom remodel, which Kris is basically in charge of.)
If it was a part of a larger Project, I stuck it in a folder marked Projects. (I didn’t finish organizing my Projects this weekend. They can wait. For now there’s a file-folder filled with them.) (For example: organizing all of my writing, from high school til today.)
If it was something that needed done on a specific date, I entered it into iCal. (For example: my upcoming dentist appointment.)
If it was something that didn’t need done right away, I stuck it in a Tickler file to process later. (For example: schedule a poetry night.)
If it was something that was just an idea, something that I might want to do someday, but it won’t kill me if I don’t, then I put it in a file marked “someday/maybe”. (For example: buy a nice leather easy chair like the one Paul J. has.)
This sorting process took an entire day. When the kitchen table was clean once again, I had several file folders filled with to-do lists. I also had a stack of Next Actions.
Organizing Stuff
All of my reference file folders (and there were several dozen of them) were tucked in a desk drawer. I put the Projects file into my inbox (because I need to break it down later, creating individual files for each project). Most of my organization, though, involved the stack of action items.
I hung the cork tiles in the nook, behind my desk. I labeled the top one “Next Actions”. Then, for each action item, I created an index card. (Actually, I ended up using my old Computer Resources business cards. They’re the perfect size.) I tacked the index cards to the cork in no particular order.
After two-and-a-half days, I was finished. My version of the Getting Things Done system was set up and ready to use.
Getting Things Done
When using the system, you’re supposed to take the next action item, no matter what it is, and just do it. You’re not supposed to sort through them. For this one time, for setting up the system, I made an exception. I cherry-picked. I selected a few cards at a time, and then I did whatever they said: clean car, buy mini-to-mini cable, check hoses on washing machine. If the action was something that I know comes up repeatedly (clean car, for example), then I tucked it in a drawer for later use.
After my initial Brain Dump, I had 53 next actions. I did eleven of them yesterday. I brought six more with me to work today (get watch batteries, let State Farm know we replaced furnace, read credit union policies, stop by Les Schwab to check on tire).
A LOAD OFF MY MIND
I took yesterday afternoon off to relax. I didn’t do any chores. I didn’t feel like I needed to: everything that needs done is sitting there, tacked to my corkboard. I don’t need to worry about it anymore
To some of you, this all probably seems silly. It may seem like a lot of effort to take care of something that you can do in your head. The point, though, is that this gets everything out of your head.
When you’re trying to juggle 53 next actions in your head (along with a dozen projects, a dozen someday/maybe wishes, a score of calendar items, and a bunch of other ideas), it can be overwhelming. It’s easy to feel stressed, or bewildered, or desperate. With the Getting Things Done system, everything is out of your head and on paper. You don’t have to think about things anymore. You just do them.
Any time a new idea occurs to you, you jot it down and put it in your inbox. (For example: a few moments ago I jotted “incorporate all calendars into iCal” on an index card. It’ll go in my inbox when I get home, to be processed later.) When magazines come in the mail and you haven’t time to read them, you put them in your inbox. When a friend gives you a flyer about an upcoming concert series, you put it in your inbox. Once a week (or more often, if you like), you sit down and process your inbox, creating next actions, filing things for reference, and otherwise deciding where each item belongs.
Toward a Pastoral Lifestyle
You know that freedom you feel when on vacation? That wonderful sense that there’s nothing to worry about? That’s what this system attempts to give you. For me, it’s yet another step toward the ever-elusive pastoral lifestyle for which I continue to strive.
On 23 May 2005 (09:30 AM),
Lisa said:
On 23 May 2005 (09:37 AM),
Courtney said:
On 23 May 2005 (09:50 AM),
Tiffany said:
On 23 May 2005 (09:51 AM),
Tiffany said:
On 23 May 2005 (10:13 AM),
Jeff said:
On 23 May 2005 (10:40 AM),
Amy Jo said:
On 24 May 2005 (11:08 AM),
JC said:
On 05 September 2005 (03:18 PM),
Jon M. said:
On 02 October 2005 (04:46 AM),
Matthew Cornell said:
On 08 October 2005 (09:07 AM),
JC said:
Note: foldedspace.org died recently, and is gradually being reconstructed. This entry has moved. Its new URL is http://www.foldedspace.org/weblog/2005/04/get_rich_slowly.html. The 86 comments from before the move can be found here.
Today’s entry is long and boring. It’s all about the keys to wealth, prosperity, and happiness. Over the past few months, I’ve read over a dozen books on personal finance. Recurring themes have become evident.
These books have embarrassingly bad titles, seemingly designed to appeal to the get-rich-quick crowd: The Richest Man in Babylon, Your Money or Your Life, Rich Dad Poor Dad, Think and Grow Rich, Wealth Without Risk, Creating Wealth, etc.
Some of the books out there — most of them? — really are as bad as their titles. Others, however, offer outstanding, practical advice. The best books seem to have the same goal in mind: not wealth, not riches, but financial independence. According to Your Money or Your Life, which I consider the very best of the financial books I’ve read, “financial independence is the experience of having enough — and then some”. More practically, financial independence occurs when your investment income meets or exceeds your monthly expenses. Financial independence is linked to psychological freedom.
How is financial independence achieved? Again, the best books all basically agree. (To some of you, this will be common sense, stuff you’ve known all your life. To others, like me, this kind of thinking is a sort of revelation.)
Here, then, is my personal summary of the collected wisdom found in these books.
Step One: Prepare the Foundation
The first step is to lay a foundation upon which the secure home of financial independence can be built. To prepare to build wealth, one must first eliminate debt, reduce spending, and increase earnings.
There are many ways to approach debt elimination; the key is to use the one that actually works for you. All the books agree on this: cut up your credit cards. Get rid of them. There is no compelling reason to keep them. Next, pay off your debts. All of them. For years, I tried the oft-touted method whereby you first pay off your highest-interest debt. This never worked for me, because my highest interest debt was also my largest debt, and psychologically I just never seemed to make any progress. What worked for me was the “debt snowball”, as defined in Total Money Makeover. I eliminated my debt by paying off the obligation with the smallest balance first. Then I took the amount that would have been applied to that debt each month and used it to pay off the second-smallest balance. When that was finished, I went to the next, etc. It only took me four months to pay off my debts this way. I was dumbfounded. I’d struggled with this for a decade, and I solved the problem in four months? Good grief.
The next step in preparing the foundation is to reduce spending. First, track your expenditures for a month. Or two. Or three. (Many people — including myself — use Quicken; it’s quick and easy.) After you’ve accumulated enough data, analyze your spending patterns. Are you spending a lot on shoes? Books? Alcohol? Dining out? Try to find expenses you can eliminate or reduce. I cut my comic book spending by a huge amount. Many of the personal finance books encourage you to reduce your auto and homeowner insurance coverage to save money. This is also the point at which some books encourage you to adopt a budget. (I tend to think a budget is unnecessary if you remain aware of your current financial situation.) (Note: it’s in this step that I should note that all of the books I’ve read advise against purchasing a new car; all encourage you to purchase late-model used cars.)
The final phase in laying the foundation is to increase your income. Not all of the books mention this, and I happen to think it’s optional. However, there are a couple of authors who are quite vocal that this is an important step on the road to financial independence. How do you increase your income? Become better educated so that your job skills are more marketable. Work harder, and smarter, at your current job so that you qualify for raises and promotions. Change careers. Find a way to make a hobby profitable. Or, as more than one book suggests, work two jobs.
I can testify first-hand that by following these three steps, you can lay a solid foundation for future financial independence. I’ve only recently finished my foundation, and am amazed at the amount of money I’m suddenly able to save each month. Amazed. And that means I’m now ready for…
Step Two: Build the Framework
The second step toward financial independence is to construct the framework upon which future wealth can be built: establish an emergency fund, maximize your retirement investments, and begin acquiring income-producing assets. This is what I’m preparing to do. (I’ve already done one part, but only by happy coincidence.)
Every book I’ve read stresses that the most important part of the framework, the first part that must be completed, is the establishment of an emergency fund. This emergency fund ought to contain enough money to support you for three to six months in case you find yourself without an income. I have a very hard time grasping this concept, admitting its usefulness. All of the books stress it. Kris, who is always right, insists that it is important. Yet I want to skip this and go to other, more exciting steps. However, having seen the results after “laying my foundation”, I’m willing to suspend my disbelief and just do it. I’ll build the emergency fund.
Next, the books encourage you to maximize your retirement accounts. If you have a retirement account through work, contribute as much as you possibly can, as soon as you can. Establish a personal IRA outside of work, and every year contribute the maximum amount. I already do this, at least in part. Custom Box has a retirement plan, but not one to which the employees can contribute. The company itself contributes approximately ten percent of each employees’ annual salary to a stock plan. One of my goals for when the bathroom is finished is to get a Roth IRA set up.
The final step in building a framework for financial independence is to invest in income-producing assets. For some reason, I’d totally missed this recurring theme until this weekend; on Paul C.’s recommendation, I read Rich Dad, Poor Dad, a book that’s almost solely about this particular portion of the framework. Beyond your retirement investments, the collected financial wisdom is that you ought to participate in further investments, specifically in income-producing assets. For different people, this means different things. Maybe it means bonds, maybe it means stocks, maybe it means investment properties. It does not mean things like cars, or collectibles (coins, comic books, baseball cards), or expensive furniture. These things may be assets of a sort, but they are not income-producing assets.
Step Three: Finish Construction
After you’ve laid the foundation to financial independence, and after you’ve built the framework, you must then spend years (decades!) finishing construction. All that’s required during this time is patience and discipline. Resist temptation. Do not accrue debt. Acquire income-producing assets; avoid non-income producing assets. Faithfully contribute to your retirement plans and your IRAs. Wait.
Step Four: Move Into the House
Some years later, you will wake to find that your financial house is in order. It’s finished. It’s ready for you to move in. How do you know when this is the case? Financial independence is achieved when your investment income equals or exceeds your monthly needs. If the total of your house payment and living expenses is $1000 per month, then you are financially independent when your investment income reaches $1000 per month. Achieving this takes time. It’s a slow, gradual process, but every book emphasizes that it’s not only possible, it’s inevitable if these steps are followed.
That’s it. That’s the combined wisdom of more than a dozen financial self-help books. I haven’t fleshed out the final two steps as much as the first two simply because I haven’t reached those steps yet. There are scores of books on how to best approach each step (even each substep!). I’m sure to obsess over each one in turn.
There seems to be only one major point on which these books disagree. Some argue that your home should be considered your most important investment, that you should carry a thirty-year mortgage and not attempt to accelerate payments. Others declare that a home should be considered a liability, the same as a car or a credit card. (The latter admit that a home will appreciate in value, but they note — rightly so — that a home is a cash drain, not a source of income.) All of the books, with one exception, encourage readers to only purchase modest homes; they smash the commonly held belief that you ought to “buy as much house as you can afford”. Instead, these books say you should only buy as much house as you actually need.
A lot of these books are easy to summarize. Their content lends itself to bullet points. For example:
The Total Money Makeover by Dave Ramsey. This book was the first I read. I want to re-read it. It features lots of practical advice, including the concept of the “debt snowball” I mentioned earlier. Here are Ramsey’s steps to a “total money makeover”:
Step #1: Save $1000 as an emergency fund.
Step #2: Pay off debts, starting with the smallest first (ignore interest rates).
Step #3: Increase the emergency fund so that it will cover three to six months of expenses.
Step #4: Invest 15% of income in growth-stock mutual funds.
Step #5: Pay off the mortgage.
Step #6: Build wealth.
(I’ve left out a “Save money for college” step because it doesn’t apply to me.)
Your Money or Your Life by Joe Dominguez and Vicki Robin is, as I mentioned, the cream of the crop of these financial books. It’s advice is sound. This is an especially great book for those seeking simplicity. It lends itself less to bullet points than some of the others, but I’ve made an attempt to enumerate the steps it advocates for financial independence:
Step #1: Determine how much money you’ve earned in your life. Next, determine your net worth. Compare and contrast the two.
Step #2: Establish the actual cost — in time and money — required to maintain your job. From this derive your actual hourly wage.
Step #3: Keep track of every cent that enters or leaves your possession.
Step #4: Determine which items are actually worth the money you spend on them.
Step #5: Graph your total monthly income and your total monthly expenses.
Step #6: Minimize spending through conscious decisions.
Step #7: Maximize income by doing something you love.
Step #8: Accumulate capital. Track its growth.
Step #9: Invest this capital so that it provides long-term income.
The Richest Man in Babylon by George S. Clason is an aging chestnut. It’s a classic in the field. Many later financial books are based on Clason’s advice, which is framed in King James-style English rules:
Rule #1: Start Thy Purse Fattening — save 10% of everything you earn
Rule #2: Control Thy Expenditures — create a budget to live within your means
Rule #3: Make Thy Gold Multiply — invest the savings from rule one
Rule #4: Guard Thy Treasures From Loss — invest only where the principal is safe
Rule #5: Make of Thy Dwelling a Profitable Investment — own your home
Rule #6: Insure a Future Income — plan for retirement
Rule #7: Increase Thy Ability to Earn — become better educated, more skilled; respect yourself
7 Money Mantras for a Richer Life by Michelle Singletary is a recent all-purpose financial book. I was ready to dismiss it for the absolute stupidity of mantra number one (stupidity in its phrasing, not in its advice), but after reading the book, I have to admit its advice is solid. It features:
Mantra #1: “If it’s on your ass, it’s not an asset.” If you can wear it, it’s not an investment. Also, something is riding your ass (such as a high house payment), it’s not an asset.
Mantra #2: “Is this a need or a want?” This is a question Kris has been trying to get me to ask myself for years.
Mantra #3: “Sweat the small stuff.” Do worry about the small expenses; they add up.
Mantra #4: “Cash is better than credit.” There is almost no reason to carry a credit card.
Mantra #5: “Keep it simple.” With money, avoid anything that seems complicated. If you don’t understand it, avoid it. You’ll probably lose money.
Mantra #6: “Priorities lead to prosperity.” Determine what’s important to you, and pursue that with your time and money.
Mantra #7: “Enough is enough.” Don’t overconsume. Recognize when you have fulfilled your needs and your wants.
Ordinary People, Extraordinary Wealth by Ric Edelman is rather a unique book. It features advice distilled from surveying 5000 people of moderate wealth. Each chapter relates a secret for obtaining financial security. At the end of the each chapter, there are excerpts from the surveys featuring anecdotes and advice from the respondents.
Secret #1: Carry a mortgage even if you can afford to pay it off. — This flies in the face of every other financial book I’ve read, and I do not subscribe to the idea. I’m willing to be that the people surveyed carry a mortgage out of habit, not because they think it’s smart.
Secret #2: Don’t diversify the money you put into your employer retirement plan; instead, put all your contributions into stock mutual funds — I’m okay with this. It may not be appropriate for someone close to retirement, but for younger people, this seems like sound advice.
Secret #3: Make many small investments rather than a few large investments. — The key is to make investing a habit, and to invest the money when you have it.
Secret #4: Rarely move from one investment to another. — Market timing is not something to be treated lightly; it’s not easy for a casual investor. Buy and hold.
Secret #5: Don’t measure success against the Dow or the S&P 500. — Understand what you own and why you own it; don’t compare it to market indicators.
Secret #6: Don’t spend a lot of time paying bills and fretting about personal finances. Don’t bother budgeting. — Many books encourage a budget, though I’ve not adopted one. And my success these past few months has come precisely because I have fretted about my personal finances. Maybe this advice is true for the long run, but I’m not sure it’s applicable to somebody just starting to lay the foundation of financial independence.
Secret #7: Involve your children in family finances. — This is another piece of advice that all of the books offer. I haven’t mentioned it because it’s not appropriate to me, and doesn’t actually fit my metaphor.
Secret #8: Pay attention to the media, particularly financial news. — This seems to go against secret #6, but whatever. I’m not willing to devote a lot of time to reading financial news, but it can be fun from time-to-time.
The rest of this book contains three wonderful chapters entitled: “The Biggest Mistake I Ever Made”, “The Smartest Thing I Ever Did”, and “My Advice to You”. The common threads? Far and away, the number one thing these people recommend is to start investing as soon as possible. As much as possible. (They also recommend getting a financial adviser, something I’ve avoided until now.)
I was going to include a point-by-point summary of Rich Dad, Poor Dad by Robert T. Kiyosaki, but when I went to write it up, I couldn’t put Kiyosaki’s advice into words. I re-read a chapter. Everything seemed generalized. I did a google search, and found that not everyone agrees with the author. I, too, found the book amorphous and vague, full of outlandish claims. I thought it contained some kernels of wisdom, though, and so I’ve taken some of its advice, albeit with a grain of salt. I’ve incorporated advice from Rich Dad, Poor Dad in my general summary at the beginning of this entry, but I cannot recommend the book.
Other books that I plan to read soon include: The Millionaire Next Door by Stanley and Danko, Wealth Without Risk by Charles Givens, and Creating Wealth by Robert Allen.
On the drive to work today, I was remembering another time I was deeply interested in personal finance. When I got out of college, I went to work for Combined Insurance. (I still promise to tell that full story some day.) During training, we were asked to make a poster illustrating our life goals. I cut out a picture of a log cabin in a lush, green woods. My goal was to retire to a peaceful lifestyle within ten years. Ha! Now, fifteen years later, I have the exact same goal. Only this time, there’s a chance that I just might achieve it.
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Interesting facts and observations.
I’ll take everything you say works for sleeping and do the opposite. As I’ve said before when my head hits the pillow I’m out like a light. I will stay soundly asleep until 6 unless the kids wake me up.
Monday I was feeling tired from the weekend. I thought I’d take a brief nap. I laid down and awoke three hours later! I was amazed! Luckily I was totally rested and ready to go but my what a long nap!. It was 5pm when I woke up. I thought I had probably ruined any chances of going to sleep at my normal 10 pm bedtime. Not so! By ten I was ready for bed. I could not tell you what happened after I crawled in and fluffed my pillow. Why? Because I was immediately snoring. I awoke at 6 as usual and went through a normal day.
I wonder if part of your insomnia is your lack of activity. It seems that the only real exercise you get is the “planned for exercise”.
Whereas my day consists of runnng after kids, mowing the yard, gardening, cooking, cleaning, vacumming 2800 sq ft of solid carpet (or so it seems) mopping floors, running to the neighbors and all up and down the street keeping track of the kids etc. By evening I’m exhausted.
My husband goes to bed at ten and gets up at 3:45 every day. His pedomoter shows that he walks an average of 12 miles a day on his job. Both of us fall asleep while saying goodnight to each other. Thats just how tired we are at the end of the day.
I hope a find a final combination of things that work for you.