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