Book review: The 7 Habits of highly effective people by Stephen Covey

The 7 Habits of highly effective people – Stephen Covey

Synopsis:
This book focuses on principles (or habits) that can help you build more effective relationships, learn to trust and be trusted, communicate better and become more efficient is your life. It is a self-help book that takes a look at your principles and values and whether they are effective or not.
The book opens by discussing paradigms and how we view the world. This leads on to the first habits that deal with ‘private victories’ or in other words, rising from a dependent person to an independent person. The later habits deal with ‘public victories’ or in other words, rising from an independent person to an interdependent person.
From time management skills to analysing paradigms of human interaction, the book looks at many different aspects of life and how you can improve those situations. The appendixes contain highly detailed information so the flow of the book isn’t disrupted.

What I gained from reading this book:
This is an incredibly detailed book that is full of useful tips and suggestions. The way the seven habits are described and how they connect are explained so well. I really enjoyed this book because it has no ‘quick fixes’ or gimmicks. The book follows a very logical flow: starting from analysing paradigms before moving on to the habits. The step by step flow of the chapters and the habits makes it very easy to understand. The main gain I received from this book would be the increased understanding I have on my own paradigms and what habits I need to improve.
When I first picked up the book and read the titles of each habit, I thought they sounded too obvious and the book would contain very general advice. I was surprised that this was not the case and the simple headings are very misleading for the quality of the information given. I realise now that the simple headings such as ‘Think Win/Win’ or ‘Be Proactive’ are simple to help you remember them.
I know that I will not become a perfect person and I am sure that I will fail many of these habits, but this book does give me a guide on what I should focus on and how to become more effective.

Positives:
Very useful information that is based on solid principles: no quick fixes, fads or gimmicks. Very detailed discussion that clearly explains our perceptions and how we can change them. The examples and scenarios are extremely helpful in explaining points.

Negatives:
Some people may feel this book is too ‘idealistic’ or may even think it is all ‘psycho-babble’. The detailed explanations and discussion may be too ‘thick’ for some people.

Recommended for: Everybody
The principles in this book deal with all aspects of life whether it is personal or business. Nobody is perfect and we can all improve ourselves if we choose to and this book can help. People wanting to improve relationships or find out how they can communicate more effectively will benefit from this book.

Genre: Self-help

Overall rating: 7 out of 10 stars

Australians can buy the book by clicking the picture below:

Where to from here:

I recommend the following book as it teaches sound principles in dealing with people:

How to win friends and influence people by Dale Carnegie

Book review: Principles of corporate finance by R. Brealey, S. Myers and F. Allen

Principles of corporate finance – R. Brealey, S. Myers and F. Allen

Synopsis:
This book discusses a wide range of topics relevant to corporations and financing. The book opens by explaining the concepts value and risk and other basic finance principles. From there the topics become progressively complex, from project analysis and net present value calculations, to debt policy and option valuation. Other topics include mergers, agency problems, credit risk, working capital management, etc. The book concludes with an important discussion on the limitations on finance and what we do and do not know.
This book uses a great number of examples and case studies to explain the concepts. Worked examples show step by step how outcomes are determined. Excel files are available on the internet that helps explain the examples. The examples are either real world companies or imaginary companies so the reader can learn how to analyse real life situations.

What I gained from reading this book:
This book really enhanced my understanding of finance within a corporate situation. This was a required textbook for a third year finance unit so I already had a good understanding of basic principles. What I learned was how to apply the basics of finance in complex situations and find optimal solutions.
This book enhanced my understanding of options and different methods to value them. Other benefits I gained included an increased understanding of tax shields to effectively reduce my tax liability and the ability to analyse the difference between leasing and buying to make the best possible decision.
I found this book was easier to understand than my lecturers and I still keep this book as reference for the future. The principles in this book won’t be obsolete in ten years (unlike other university books I have) so even if I forget how to apply a principle, I know I can easily re-learn it.

Positives:
The book starts off explaining simple finance principles before going into complex issues so those new to finance won’t struggle from the start. The examples and the excel files on the internet made the learning process so much easier. The principles in this book are useful in a wide range of situations, not just for corporations.

Negatives:
Some people may have difficulty with this book, especially if you don’t already have a good understanding of the basics of finance. Some topics are very complicated.

Recommended for: Business and finance students
If you are taking a course in business or finance, you will probably benefit from learning these advanced concepts. If on the other hand you are thinking of starting your own business, having a strong understanding of complex issues raised in this book will definitely put you at an advantage.

Genre: Finance

Overall rating: 7 out of 10 stars

Where to from here:
After reading this book you will probably want to learn specifics on other topics such as taxation or accounting. I haven’t reviewed any of those books so have a search for some on the topics your interested in.

Australians can buy the international edition by clicking the picture below:

Book review: The richest man in Babylon by George Clason

The richest man in Babylon – George S. Clason

Synopsis:
This book is a collection of Babylonian parables that the author wrote in the 1920s. These parables were made into pamphlets that banks handed out to customers. The stories are used to explain the basic principles of finance such as compound interest, investments, saving and controlling expenditure.
The parables are based on ancient Babylon, a wealthy and educated city from over 5,000 years ago. The stories are written in the old ‘King James’ language (eg: thy, thou, morrow). Tales of how one person became a slave and managed to buy his freedom through hard work instead of shirking, how one person who ran away from his massive debts managed to repay them over time by planning, etc.

What I gained from reading this book:
This book was very interesting to read because I haven’t read anything else like it. The old language used was very unusual but served well in painting a picture of an ancient time in Babylon. The stories are well written and quite clearly show what it could have been like living back then. The principles that the parables are based on are very fundamental principles of personal finance, so I already knew them. It was refreshing to read them used in a story.

Although the principles are very basic and can be learned in any personal finance book, so many people don’t even know them or don’t bother to apply them. I have many friends who don’t even know about these principles or they come up with excuses why they don’t apply them. Reading these tales rejects any excuses by effectively saying “people managed to apply these principles 5,000 years ago so you have no excuse not to”.

I did have trouble with the old language used and some parts I got lost and couldn’t understand what was being said. From what I understand, another version has been published using current language that people will be able to understand. Even know I had difficulty with the old language, I prefer it. The old language is effective in the storytelling and I think the other version would not be as enjoyable.

Positives:
Explains sound principles that have stood the test of time and that everybody should use. Interesting storytelling of an ancient time and the old language adds to the authenticity.

Negatives:
Some people may have trouble understanding the old language. The book is quite short, but in a way that’s good because it gets right to the point. People who already understand the basics of personal finance won’t learn anything new.

Recommended for: Everybody
I recommend this book for people who want to get a basic idea on how to manage their money but don’t like the idea of reading a finance book. The storytelling is an effective way to understand the principles without being bored unlike so many educational books.
Genre: Personal finance/Wealth

Overall rating: 8 out of 10 stars

Australians can buy the book by clicking the picture below:

Where to from here:
After reading this book you will probably want to learn more about personal finance and how to apply the principles. There are many books that explain how to effectively manage your money.

I recommend the following to gain more insight into building your wealth or improving your financial situation:
The millionaire next door by Thomas Stanley and William Danko
Rich Dad Poor Dad by Robert Kiyosaki

Book review: Negotiating for dummies by Michael Donaldson

Negotiating for dummies – Michael C. Donaldson

Synopsis:
This ‘for dummies’ book explains what negotiating is and how to apply it in various situations. The first part deals with preparation and explains what should be done before a negotiation begins. The second part explains the actual process and looks at what questions to ask, how to properly listen and what to look for in body language from the other parties. The third part looks at how to handle situations when they don’t go smoothly. Part four looks at ‘complex’ situations such as international negotiations and negotiating over the phone or internet.
The book is written in a format like all the other ‘for dummies’ books. The author uses movies as examples to help explain a point or method. Clear advice is given for specific situations.

What I gained from reading this book:
I had already read a few books on negotiating before reading this one so I already had a good understanding on the topic. However, if this was the first book I had of read, I would have been very confused by the end. Normally I only review books that I believe give the readers value. This book was fairly poorly written (in my opinion of course) and it seems the author isn’t sure how to teach the topic in a book. If you read the reviews on Amazon, you can see that I’m not the only person who feels this way.

Unfortunately, this book is confusing in its layout and the information given is very general. One example was the chapters on asking questions and listening. If you picked up the book and read those chapters without looking at the title of the book, you wouldn’t have thought it was a book on negotiating. Some of the topics that are discussed are a far stretch from what negotiating is about. The author seems to have trouble staying on topic and the result is a collection of ideas that relate to negotiation, not a clear method or explanation. The references to movies are an example of how the author drifts off topic. Although the movies may provide insight to the topic, the references don’t explain anything on their own.

This book falls far behind the others I have read on the topic. The others (list at end of review) were very detailed in the actual method used and explained BATNA (a term developed by the Harvard Negotiating Institute) very well. This book only mentions BATNA in one single paragraph. Compare that one paragraph to other books that have been written solely explaining BATNA.

NOTE: Although I was truly disappointed with this book, others may benefit from it. If you are after a general look at negotiating and how to improve your ability to discuss issues with people, it may be right for you.

Positives:
As all the ‘for dummies’ book, this one is very basic to understand and anybody can pick it up and start reading from any chapter. The advice given for specific situations can help those who aren’t sure exactly what they could do.
The references to movies may help you get an idea of what the author is talking about.

Negatives:
The book looks at a great number of different aspects related to negotiating, but doesn’t go into depth into any of those aspects.
There is no clear explanation of a method to use or details to BATNA, which so many other books spend a significant portion of pages explaining and demonstrating.

Recommended for: Not recommended.
This book does not meet my quality requirements for me to recommend to anybody. Although some people may benefit from it, there are better alternatives (listed below).
Negotiation is an important topic that I believe everybody should learn so I recommend you read the reviews I have written for other negotiation books.

Genre: Business skills

Overall rating: 4 out of 10 stars



Australians can buy the book by clicking the picture below:

Where to from here:

Instead of reading this book, I recommend the following on negotiation:

Getting to YES by Roger Fisher and William Ury

Alternatively, to understand another way of influencing people, I recommend:

How to win friends and influence people by Dale Carnegie

What to spend your economic stimulus handout on

STIMULUS HANDOUTS
In Australia, the government is giving a range of taxpayers a small sum of money to help stimulate the economy. As far as I know, many other countries may do the same thing. So if you have received (or will receive) some money, you are probably wondering what to spend it on. There are smart things you can spend it on and there are dumb things to spend it on. Being a book review blog I’m sure you can guess what I suggest you spend your money on…

That’s right, educational books. Now don’t go running away now, let me explain why!

I majored in Finance at university so I am always focusing on the best ways to improve my personal financial situation. As a finance graduate, I strongly recommend you spend a little bit of your handout money on personal finance books. Even one book will help you out greatly. I suggest this because if you start improving your financial education now, by the time the next recession begins you will not be in a delicate situation and suffer like countless people are now. So I whole heartedly recommend spending (some of) this ‘stimulus’ money to improve your personal financial situation now and for the future. A new HDTV may be extremely tempting, but in ten years it will be obsolete junk. The knowledge you can gain from reading up on personal finance will improve your entire future.

HOW CAN A PERSONAL FINANCE BOOK HELP YOU?
If you find yourself in a situation where bills keep piling up and you find it hard to get ahead financially despite having a decent paying job, it may be due to a lack of financial education. Don’t be put off by hearing that, the majority of the population don’t even understand the basics of money. That’s why so many people see financial planners – so somebody else can ‘fix’ their problems. The truth is that it is a lot easier and cheaper to learn how to fix your own financial problems on your own. By understanding why the way you spend your money is not helping you, you can learn and stop doing it in the future. Compare that to paying a financial planner to tell you the same things a book can tell you. The bottom line: just reading one personal finance book can teach you to improve your situation now and in the future.

WHAT TO SPEND THE REST OF THE MONEY ON?
If you buy a couple personal finance books and read through them, you should have a good idea what to spend the rest of your handout money on. If you read the right books, you should hopefully realise that buying a new TV or some other gadget may be fun in the short term, but won’t put you in a better position in the future. That TV will depreciate so fast it will be worthless before you know it. So what should you spend the money on? That’s why I suggest buying personal finance books, to be able to answer this question on your own! I could go into a very lengthy article on investments, but learning from a reliable investment book is better than any article I could write. So go buy a couple personal finance books and investment books to learn how you should properly spend your money. If you do so, I strongly believe that in ten years time you will be glad you did.

WHICH BOOK SHOULD I GET?
I will be reviewing personal finance books as I read them so check back here often to see what books can help you out. But if you want to find a book on your own type in ‘personal finance’ in the Amazon search box to the right. Many of the personal finance books will teach the same thing so just make sure the book you choose has been given a decent rating. To see what investment/wealth books I have already reviewed, click on ‘list of book reviews’ at the top of the page.

Book review: The E-Myth Revisited by Michael Gerber

The E-Myth Revisited (Why most small businesses don’t work and what to do about it) – Michael Gerber

Synopsis:
This book looks at why 80 percent of small businesses fail within five years of starting. The mindset of the business owner is looked at and analysed to determine why the business fails. The mindset of the business owner and how they think of their business is a significant factor in the success of the business.

The author introduces Sarah, a small business owner struggling to keep the business running. The author walks through a conversation with Sarah explaining the reasons why her business isn’t working and what she needs to think about for it to work. The author uses storytelling and examples to give the reader a clear picture of a certain situation or problem. The steps in the ‘life’ of the business are considered in detail to give the reader an idea of stages a business must pass through to become successful. Lessons in franchising are considered and the way of thinking Ray Kroc (from McDonalds) used to build his massive empire.

What I gained from reading this book:
This book makes it very clear why many people fail at running their own business. The concept that people should work ‘on’ their business and not ‘in’ it is so important in my eyes now after his explanations. As the author states, this book is not a ‘how-to’, instead it is a ‘what to do and why it needs to be done’. The author strongly believes that ‘how-to’ books don’t work if you don’t know ‘what to do and why’ first.

This book has really got me thinking about issues I had never considered before. I want to one day open up a small business and this book was just what I needed. Through my university studies I have already studied plenty of ‘how-to’ but those studies never considered the ‘what to do’ and ‘why’. Now that I know what I need to do and why it needs to be done I can look again at the how-to books to properly prepare myself.

Although I haven’t started my business yet (it could be years from now), I now feel much more confident in building a successful business because I understand why many people fail and why. This is the number one gain I received from this book, the understanding that three years of business study never even considered. I wish I read this book three years ago.

Positives:
Extremely insightful to the realities of small businesses and their owners. Identifies the reasons why many businesses fail and what to do to avoid being one of them. The use of storytelling and examples are very good at painting a detailed picture of the concepts to learn.

Negatives:
This book is not a ‘how-to’ so people expecting this may be disappointed. While some people may like the storytelling the author uses, other people may find it distracting. Apart from that the book was very well done.

Recommended for: Anybody interested in small businesses.
I recommend this book for anybody wanting to start a small business of their own and those who have already started one. If you haven’t started yet, this book will give you a great starting point to understand what you need to learn and why you need to learn it. For those who have already started a business, this book will get you to look at the business in a new way that will no doubt improve your chances of success.

Genre: Small business

Overall rating: 9 out of 10 stars



Australians can buy the book by clicking the picture below:

Where to from here:
After reading this book I would read one of the ‘how-to’ books on specific topics the author mentions. I would recommend reading MBA in a day by Steven Stralser to get an overview of business skills. From there you can go into more detail on each topic.

Book review: Rich Dad's Retire Young Retire Rich by Robert Kiyosaki

Rich Dad’s Retire Young Retire Rich – Robert Kiyosaki

Synopsis:
Robert Kiyosaki is the author of the book Rich Dad Poor Dad (I have also reviewed his book Cashflow Quadrant). This is the fifth book he has released under the ‘rich dad’ brand. The basis of this book is explaining how he was able to start with nothing and retire nine years later financially free. The focus is on the different forms of leverage and how you can use them for your benefit. The main message is to expand your ‘context’ or your reality. The last section in the book discusses specific investments such as real estate, paper assets (shares, options) and businesses.
Like the other Rich Dad books, the author contrasts the things his ‘rich dad’ and his ‘poor dad’ have said to him in the past. The focus is on helping you understand that what you believe and say will ultimately determine what type of person you end up as (as in poor, middle class or rich). As the author would say ‘the words became flesh’.

What I gained from reading this book:
I gained so much from the Rich Dad Poor Dad book. Read through that review to see how important I feel it is. This is the third book of his that I have read. He has made some really good points in this book and other points I didn’t agree with. But I did gain from this book. The idea of expanding your context and opening your mind is a powerful one. While I was reading certain chapters I wasn’t too interested in what was being said but after I finished the book I began to notice the truth in the points he made. The examples he made of people not willing to open their mind to possibilities would fit some of my friends perfectly.
I already knew the points he made on shares and options (I studied them at university) so I didn’t learn anything new there but the explanations are well done. This book really does a good job at improving your ‘context’ as the author would say. In other words, it opens your mind to the possibilities of doing things that you would normally never consider.
Although I am not rich yet, I do feel that these books are helping me and improving my future prospects. This book doesn’t look at investment specifics because there are plenty of books on the topic. This book looks at helping you accept that it is possible to get rich (which many people including my friends don’t accept as a possibility).

Positives:
Introduces people to some basic concepts in shares, real estate and options. The conversational style of writing is easy to understand. The book can really help open your mind to possibilities that many people would never accept. The explanations on the different forms of leverage are very useful in real life.

Negatives:
Some people may not like the use of fairy tales to make points. Others may not like the repetition the author uses. Basically, if you did not like his other books, you won’t like this one. If you haven’t read his other books, I recommend Rich Dad Poor Dad over any others.

Recommended for: Those wanting to be rich or successful
I recommend this book for people who seriously want to be rich or successful one day. I say ‘seriously’ because I know many people who say they want to get rich but won’t do anything about it. If you don’t want to put effort in, this book won’t be useful to you. If on the other hand you really aim to put the effort in to try to get rich, this book (as well as his others) can really put things in perspective.

Genre: Investments and personal finance

Overall rating: 7 out of 10 stars

Australians can buy the book by clicking the picture below:



Where to from here:
If you are interested in reading other books by Robert Kiyosaki, I have reviewed other ones here:
Rich Dad Poor Dad
Cashflow Quadrant
Why we want you to be rich by Robert Kiyosaki and Donald Trump

On the other hand, you may want to consider reading books looking at ways millionaires become rich:
The millionaire next door by Thomas Stanley and William Danko
Ten roads to riches by Ken Fisher

Gaining an advantage in a recession

THE CURRENT SITUATION
The current (2009) global economic position isn't too flash. With many countries in or nearing recession, companies are more likely to downsize and people are more likely to lose their job. Increasing your skill base not only improves your chances of keeping your current job, but it also improves your competitiveness if you look for another job. Recruiters are known to be pickier in times of recession and maximising your skills and knowledge can help you stand out of the crowd.
If you currently have a job you like you should be happy because many people wish they could say the same thing. If you are concerned about the real possibility of losing that job, reading up on the following topics will put you in a better position to hold onto your job.
On the other hand, if you are unfortunate enough to have lost a job already, don't let it get you down. Read up on these topics to help you stand out of the crowd when looking for a new job.

WHAT TO LEARN
For those who are looking at improving their skills and knowledge to gain an edge in the business world, I recommend learning the following topics.

1. Negotiation
It doesn't matter what type of job you have or want, you will need to know how to negotiate. People have a common misconception about negotiating, thinking it is only for union leaders or board room meetings. In fact, it is an everyday skill that everybody uses without even realising it. By reading up on this skill, you will not only have more control of your current situation, but you will have more control over your future situation. This is number one on the list because of the positive impact it can have on your career. It’s not just used to ask for a raise, it can be used to get more favourable hours, flexibility, increase possibility for promotion, etc.

2. Communication
Look at almost any job advertisement and under the list of skills required will almost definitely be 'good communication skills'. It is so important and yet, many people don't even bother to learn about it. Even reading one book on the subject puts you above the majority. So find a book on the topic and read about it. Then go out there and apply the information you have read. Recruiters put a very high emphasis on communication skills.

3. Body language
Most people either don't have a clue what body language is or they have an extremely limited understanding of it. This is why it is so important to learn. If you learn about body language, you will have a clear advantage over most people. Body language is the non-verbal language everybody uses without realising it. You can accurately read other people's signals and gestures to determine their thoughts and feelings. This is great for most jobs when you work with other people. Reading other people's body language can help you a great deal.

4. Business basics such as accounting, economics, management, marketing
Even having a basic understanding of these areas can put you at an advantage. Most people are happy with their limited understanding and don't care about learning other areas. Those who learn even the basics of other business areas have an advantage. If you have ever heard somebody use jargon and you were left scratching your head over it, you should learn more about the area. Not only will it make your life easier by understanding more, but other people will recognise and value your wide understanding.

5. Personal finance
This topic is more for your own personal needs rather than career need. Having a better understanding of personal finance can help you improve your situation so a recession won't have as much of an impact on you. Unfortunately for many, the recession has already hit hard. In either case by learning more on personal finance you are improving your future prospects. If you know the basics you should continue your learning by reading up on more advanced areas. Doesn't matter what your current situation is, you can improve your situation through learning. Even if you have a financial planner you go to, you should still read up on it. You may even find out that the principles are so basic you can do it yourself without any help from a financial planner.

THE FUTURE SITUATION
By reading up on these topics you put yourself in a better position for the future. If you read up on the basics of economics, you will find out that recessions (like the current one) will end. When the recession ends you will be better prepared for the next expansion (opposite of recession) and be at an advantage when looking to improve your career. While I can't guarantee that learning about these topics will be enough to get you a new job or keep your existing one, I am sure that it will help you to do so. Just remember, the more you learn the luckier you get.

Have a look at List of Book Reviews to find books I have reviewed on the topics above. If you can think of any other topics that are useful to gaining an advantage in a recession and could be added to this list, feel free to let me know by leaving a comment.

Book review: The Millionaire Next Door by Thomas Stanley and William Danko

The Millionaire Next Door: The surprising secrets of America’s wealthy – Thomas Stanley and William Danko

Synopsis:
This book is basically an analysis of the millionaires and their habits. The book looks at a wide range of aspects such as how much they spend on cars, watches and suits, whether they give cash gifts to their children or not, what type of jobs they hold, and how they became rich in the first place. The authors have surveyed countless millionaires and found patterns among them. They compare high income individuals with low net worth (non-millionaires) to millionaires with low income to see how somebody can become a millionaire despite having lower income than others.
The authors try to get a feel for the mindset that millionaires have and try to give a clear picture on how anybody could do the same. The authors even provide a simple formula for the reader to look at their own situation and see whether they are above or below the average in terms of net worth.

What I gained from reading this book:
This book goes into incredible detail on millionaire habits. The book is full of statistics and analysis of a wide range of topics. I found the results very interesting. So much is revealed that many people would never consider being possible. Before reading this book I had a picture of how the typical millionaire lives, but after finishing the book I realised how wrong I was. The detail in the book allowed me to compare my own situation with the case studies to see how I perform.
The major gain I received from this book was the confidence that if I follow the principles in the book, I have a better chance of being financially independent in the future. Not only that, I know what things I should avoid doing that will reduce my chances of becoming financially free. My hyper-spending friends could learn a lot from this book but I know that they would never bother reading it.

Positives:
Very detailed and insightful analysis on millionaires and their attitudes. Great comparison between millionaires and non-millionaires. Provides very informative case studies that are seen in real life all the time.

Negatives:
The analysis is very detailed which some people may not like. At times I even had trouble staying focused because of all the statistics.

Recommended for: Everybody
I recommend this book for everybody because everybody can learn how to make better use of their money. Those who wish to be financially independent in the future should have a read to see what it takes to get there. On the other hand, those not concerned with becoming millionaires should still read the book. Those not concerned with how they spend their money have higher risks as explained in the book.

Genre: Wealth

Overall rating: 7 out of 10 stars

Australians can buy the book by clicking the picture below:



Where to from here:
If you are interested in reading more on how people become rich, have a read on:
Ten roads to riches by Ken Fisher

Book review: Cashflow Quadrant: Rich Dad's Guide to Financial Freedom by Robert Kiyosaki

Cashflow Quadrant: Rich Dad’s Guide to Financial Freedom – Robert Kiyosaki

Synopsis:
This book is the sequel to the Rich Dad Poor Dad book. It expands on the concepts and principles explained in the first book. The focus in this book is on the different ways people earn money and more importantly, the psychological mindset of the type of people in each area. The author splits up all ways to earn money into four ‘quadrants’. The quadrants are: Employee, Self-employed (or small business), Big business, and Investor. The author then looks at each quadrant and explains why the people in certain quadrants have an advantage over others. Differences in people within the quadrants are explained. The book concludes with steps to become financially successful.

What I gained from reading this book:
I gained so much from the first Rich Dad book and this book was great to expand my understanding on the concepts that the author discusses. Reading about all the different types of people and the different quadrants was a great way to take a look at myself and my personal situation. By the end of the book I had a clearer understanding of where I currently am (financially and psychologically) and where I want to be in the future. Just like the first book, there were great tips and advice that were never discussed in my University years studying finance and investments that I feel are so important for everybody.

Positives:
Expands on the valuable concepts in the first Rich Dad book and introduces new concepts. Great explanations on the different types of people and ways to earn money. This book can be a great tool to assessing your situation.
The concepts are very simple to understand which means anybody can read it. You don’t have to have studied accounting or finance before to understand the points the author makes.

Negatives:
If you did not like the first Rich Dad book, you probably won’t like this one either. If you haven’t read the first book, you probably won’t understand what this book is discussing. The author uses repetition as a teaching tool and some people may not like learning this way.

Recommended for: Everybody
Everybody who has read the first Rich Dad book should read this book to expand the understanding of the concepts explained. I recommend this book for everybody because having a basic understanding of cash flow can improve your personal finance situation.

Genre: Self help and personal finance.

Overall rating: 7 out of 10 stars

Australians can buy the book by clicking the picture below:



Where to from here:
If you are interested in reading other books by Robert Kiyosaki, I have reviewed other ones here:
Rich Dad Poor Dad
Retire Young Retire Rich
Why we want you to be rich by Robert Kiyosaki and Donald Trump

On the other hand, you may want to consider reading books looking at ways millionaires become rich:
The millionaire next door by Thomas Stanley and William Danko
Ten roads to riches by Ken Fisher

Do you find my book reviews helpful?

Hi everybody,

I have put a poll up on the sidebar for people to rate how helpful my reviews are. Please use it after you read a review so I know if they actually have value for some people or not.

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Thank you,
Aaron

Book review: Freakonomics by Steven Levitt and Stephen Dubner

Freakonomics: A rogue economist explores the hidden side of everything – Steven Levitt and Stephen Dubner

Synopsis:
Freakonomics sees an economist looking at some unusual questions and attempting to find answers. The focus is on ‘conventional wisdom’ and how people assume such wisdom to be correct without any proof. The author explains why conventional wisdom is often wrong and how the experts will bend the facts to support their own interests. Topics include cheating schoolteachers and sumo-wrestlers, self serving real estate agents, poor drug dealers and criminals and obsessive parents. The author uses economic analysis to give light to why conventional wisdom often lacks any wisdom at all.

What I gained from reading this book:
Being an economics graduate, I thoroughly enjoyed this book. My economics lecturer always tried to explain why economics could be used to explain questions like the ones in this book but most students couldn’t understand what he meant. After reading this book I now wonder how much of the ‘conventional wisdom’ we come across actually have any truth in them. I really enjoyed reading why real estate agents don’t have the incentive to ‘get every last dollar for your house’ like they claim to do or why school teachers would cheat on students’ tests. I feel I really gained by learning to question what most people assume to be right.
I really wish that this book was on the ‘reading list’ during my university study because it would have helped so many students understand the value of economics and its way of thinking.

Positives:
Looks at very interesting and bizarre situations and questions. Can help you open your mind to thinking outside of the conventional wisdom that so many people assume is fact.
This book can help out economics students by showing them the side of economics they probably haven’t been learning in lecturers. There are no formulas here, only explanations.

Negatives:
Some of the statements in this book may offend or shock some people. Some topics are very close to many peoples’ hearts such as abortion, racial discrimination or parenting. If you read this book with an open mind you can at least understand the points the author is making. If on the other hand you shun everything the author says on those controversial topics, you will finish the book with no gain.
For those who know little or nothing about economics, you may dislike the author’s reasoning. As the author says ‘if morality represents an ideal world, then economics represents the actual world’. Sometimes the ‘actual world’ answers are not what we want to hear.


Recommended for: Those interested in economics
I highly recommend this book for all economics students. I have noticed that many of the students I talked to that failed or had low marks didn’t understand the way of thinking that this book uses. If you find economics hard, it may be because you have trouble understanding the mindset required. This book can help you in that regard.
For those not studying economics, it may still be interesting because of the unusual topics.

Genre: Economics

Overall rating: 8 of 10 stars

Australians can buy the book by clicking the picture below:

Book review: Five key lessons from top money managers by Scott Kays

Five key lessons from top money managers – Scott Kays

Synopsis:
This book is based from the information received in interviews between the author and five well known money managers: Bill Nygren, Andy Stephens, Christopher Davis, Bill Fries, and John Calamos. Discussing investment principles and valuation methods, the author has come up with five key points that each of the five money manager follows. The concepts such as intrinsic value and developing a valuation model are discussed in detail.
Basic finance principles such as the time value of money, dividend discount model and Internal Rate of Return (IRR) are also discussed with examples. Examples are used to explain how to use these tools in real life such as analysis of a situation when Home Depot’s stock provided a significant opportunity to profit. The process of screening stocks to match certain criteria is explained in great detail.

What I gained from reading this book:
This book was fantastic to read as it gave very clear analysis of the methods used by money managers and how to put together your own investment system. The principles are very clearly explained (better than many of my finance lecturers did) and very useful. The concept of valuation is extremely important but many people neglect to learn about it (think of all the investors at the peak of the dot-com bubble).

The chapters are very clear and well explained. I gained a lot from the step by step explanations and examples. This book taught me how to compute IRR better than my second year finance lecturer did. This book not only gave me valuable information that I can use with my own investments, but it also made my finance studies a lot easier. Although I don’t plan on investing in a way that is explained in this book, knowing the principles and how to correctly apply them is extremely valuable. I think anybody who is interested in investing can gain from this book as I have.

Positives:
Very clear examples and explanations. The information provided can be very useful in deciding whether other investments are worthwhile or not.
Detailed explanation on creating your own investment strategy and what should be included. Explains how by using a simplified strategy. Very easy to learn thanks to the author’s clarity.

Negatives:
Although the concept of valuation is simple, it is quite hard to come up with reliable valuations for companies in real life. This isn’t a negative for the book because the author explains the problem. I am just making this clear for those who may think it is easy to apply what it taught. I don’t really have any negatives for this book. Well, I wish it was longer. But there are plenty of other books to add to this information.

Recommended for: People interested in investments
I recommend this book for people who are serious about investing on their own. I gained more from this book than quite a few finance units I took at university. The small price tag of this book compared to the high cost of university fees makes this book priceless. The concepts were explained better in the book compared to my university lecturers.
By understanding what is needed to create your own investment strategy, you are more likely to succeed. In other words, if you don’t know what this book is teaching, you are at a disadvantage.

Genre: Investments

Overall rating: 8 out of 10 stars

Australians can buy the book by clicking the picture below:

Book review: Body language (how to read others' thoughts by their gestures) by Allan Pearse

Body language (how to read others’ thoughts by their gestures) – Allan Pearse

Synopsis:
This book focuses on identifying non-verbal signals that people make and how those signals can tell you what the person may be thinking. As far as I know, this is the first detailed book written on the topic. Research shows that our ‘body language’ is a significant part of how we communicate. Most people think that verbal communication is the most important aspect of communication. This book discusses the basics on how we communicate with our body and gestures.
This book focuses on business situations but the gestures discussed are used in all situations so everybody can still read it.

What I gained from reading this book:
This book has improved my communication and people skills a great deal. As I read through the book, I started noticing gestures and positions that other people make. I even began to notice all the signals my body would make. Recognising all those signals and gestures helped me get an understanding of how people are feeling and their motives. Not only has this book opened my eyes to a ‘language’ I didn’t even know existed, it has really been fun watching my friends and family make all these gestures I never noticed before.
Using this knowledge in my job in customer service has been great. My confidence in dealing with people has increased because I now have a pretty good idea how a person will act based on their body language.

Positives:
Understanding the signals people make can help you understand their position better and improve communication. The pictures give clear examples of what to look for. The examples are simple enough to recognise without spending too much effort watching the signals people make.

Negatives:
Some people may think that a lot of the gestures discussed are common sense (for example: thumbs up means okay or good). While many of the gestures are very basic to recognise, most people don’t even notice them in everyday life. Reading about the obvious gestures still helps you learn about them.
As the book was written quite some time ago, some situations may seem out dated. Don’t be put off by the age of the book because when you think about it, the way people act hasn’t really changed in the last thirty years so everything will still apply today. I have reviewed a more current book by an ex-FBI agent on body language here.

Recommended for: Everybody
I recommend this book for everybody because having an understanding of basic body language can improve your people skills. This book will be very useful for business people as many of the examples are common business situations.

Genre: Informational

Overall rating: 7 out of 10 stars

Where to from here:
If you want to improve your understanding of body language, have a read of the following reviews:
What every BODY is saying by Joe Navarro