“Cold Hard Truth on Men, Women and Money” by Kevin O’Leary

Cold Hard Truth on Men Women and Money

“Don’t spend too much. Mostly save. Always invest.”

That’s the secret to becoming wealthy, according to business entrepreneur, “The Learning Company” founder, and “Shark Tank” co-host Kevin O’Leary.

But if it were easy, we would all be wealthy. So O’Leary wrote “Cold Hard Truth on Men, Women and Money: 50 Common Money Mistakes and How to Fix Them” (2012) to talk about our relationship with money and how we can “save money, invest better, and cut your losses.”

To get people more comfortable thinking about money, O’Leary starts with personal anecdotes and a financial quiz. He offers several tools to help you understand where your money comes from and where it goes, including a “90-day number,” a finance calculator, and how to find “ghost money.”

What is the cold, hard truth? O’Leary warns, “No matter how much money you make, the world is designed to take it away.” To combat this fact, O’Leary offers is the “Cold Hard Truth Card,” a credit-card sized pledge about money that I think we should all carry around in our wallets.

The “Cold Hard Truth Card” says:
I pledge to make no purchases unless I can answer TRUE to the following 5 statements:
1. I have given this purchase sufficient thought.
2. Buying this item will not create debt for me or anyone else.
3. I not only want this item, I need it.
4. This item is more valuable than the interest I’d earn if I saved the money instead.
5. This item will matter to me in a year.

The challenge is to find that set point of “enough” and then rarely exceed it. Once you find your set point, don’t spend more extravagantly even when your income increases. “When you get to a place of ‘enough,’ you will stop having money problems,” he writes.

He emphasizes three guiding principles about money: keep money and emotions separate; eliminate debt; and be grateful for what you have.

Here are 3 common money mistakes everyone makes:
* You’re in the dark about your finances. The fix: correct that by figuring out your 90-day number (all your earnings over 3 months, minus all your expenses over 3 months).
* Money (buying stuff) makes you happy. The fix: if you’re bored, lonely frustrated or sad, go for a walk, cook, read – but don’t shop! Avoid advertising by cutting down on magazines, TV, and the internet.
* You don’t know what to invest in. The fix: the 3 basic rules of investing are 1) invest in stocks and securities that pay dividends/interest; 2) save a consistent portion of your income; and 3) spend the interest, not the principle.

And here are 3 more money mistakes about things you think you need:
* You think you need a car. The fix: car ownership is not for everyone. If you can, move closer to work town. Walk, bike, or take public transportation. If you need a car, lease your vehicle or buy used.
* You think you need a college degree. The fix: Think outside the cubicle! Not everyone should go to college. Skilled trades don’t require years of expensive schooling.
* You think you need to buy a home. The fix: rent, don’t buy. If you have debt (like student loans), you should rent until you are debt-free.

“Cold Hard Truth on Men, Women and Money” lays out our money problems in simple terms. O’Leary offers practical and helpful tools to save money and to think about money in a new way: as creative energy, not as a way to get “stuff.” Some of his suggestions may seem unemotional and unromantic (he strongly recommends pre-nuptial agreements before getting married) and may not work for everyone. One mistake that is missing: “You think that newer means better.” This is not necessarily true; newer is different, not necessarily better.

For more money ideas, visit Kevin O’Leary’s website.

Explore posts in the same categories: Book Reviews, Money

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5 Comments on ““Cold Hard Truth on Men, Women and Money” by Kevin O’Leary”

  1. shazjones Says:

    I like the idea of the Truth Card … and I think another money mistake that I often encounter with my clients is “I’ll have more money later” – they all put off saving and investing until . The key is to start saving right now – no matter how difficult your current circumstances seem.

  2. Way cool! Some very valid points! I appreciate you writing this
    post and the rest of the site is really good.

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