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Book Review: David Bach's Smart Women Finish Rich

by Susan Farrell

David Bach, in Smart Women Finish Rich, provides seven steps to achieving financial security and funding for your dreams. Bach is not only a financial adviser, but he also conducts investment seminars for women. This book provides some great insight about determining what financial security really means to you, how to determine what your present situation is, and how to set and achieve your financial goals. Although I thought I knew my finances fairly well, his quiz "The 'Smart Women Finish Rich' Financial Knowledge Quiz" made me realize how much more I need to know. This quiz is on page 33, and was enough of a kick in the pants to keep me reading to find out what else I don't know and how to do something about it!

Bach walks you through his seven steps in a language that is easy to relate to and understand. The reading is easy and smooth, and divided up in sections short enough that you can read even while you're home with the kids or while waiting for appointments.

The seven steps, though somewhat familiar and logical-sounding, are well worth investigating further.

Learn the Facts -- and Myths -- About Your Money
Put Your Money Where Your Values Are
Figure Out Where You Stand Financially ... and Where You Want to Go
Use the Power of the Latte Factor... How to Create Massive Wealth on Just a Few Dollars a Week!
Practice Grandma's Three-Basket Approach to Financial Security
Learn the Nine Biggest Mistakes Investors Make and How to Avoid Them
Follow the 12 Commandments of Attracting Greater Wealth

What I enjoyed most about this book was its step two's insight about determining what money really means to you and why you want/need more of it. It isn't just about how to make more money -- it's about achieving your goals and dreams with it. His "Values Ladder" approach forces you to really evaluate what money provides and means to you, and helps you evaluate if you are headed in the right direction toward achieving what is truly important to you rather than just saving money for reasons you think you should. It's an exercise I'd recommend to anyone.

Additionally, Bach provides steps that even someone on a very tight budget can make. This isn't a book that tells you just how to invest with a $500 or more starting amount, or requires that you save large sums each week. There are steps anyone can apply to their lives. Ever calculate what you spend for lunch or coffee/sodas/snacks in a day? 50 cents here, a couple dollars there ... if you could save $3.50 a day, do you realize that adds up to more than $100 in a month? What could you do with an additional $100 per month? Think you can't ever have a million dollars before you retire? If you saved $2 a day at a 12 percent annual interest rate, starting at age 20, by the time you were 65, you'd have $1,000,000. Given that figure and my present age (mid-thirties), I'm thinking I know what I could achieve with that $3.50 per day!

Also, in step four, Bach provides some basic rules and even promises you that if you follow his rules, in just 12 months, you will be surprised and delighted with the results. Those seven rules (my comments in parentheses):

"Until it's written down, it's not a goal -- it's just a slogan." (write it down and commit to them, no excuses)
"Goals must be specific, measurable, and provable." (make solid goals, not dreams and wishes)
"Take some immediate action within the next 48 hours to start moving toward your goal." (take action, no matter how small, and keep the goals alive & very real -- keep the momentum going)
"Once you have written down your goals, put them someplace where you can see them every day."
"Share your goals with someone you love and trust." (there are resources and people all around who can help you)
"Develop goals that fit in with your values." (achieve what is truly important to you)
"Review your goals at least once every 12 months." (recommit and/or revise as your life progresses and changes)

Bach finishes his book with a couple of wonderful reminders. One is to take the time to smell the roses: "Never forget that the greatest asset we have is life ... you shouldn't get so consumed with your financial journey that you don't spend enough time sharing moments with the people you love." The other reminder is a great motivator to me and one I have printed and posted where I can see it regularly:

"If you believe you are going to be alive five years from now, then there are really only two potential outcomes. You either will be five years older and have achieved your dreams (or at least be well on the way toward achieving them) because you have used the tools in this book and gone for it, or you will just be five years older."