Saturday, April 12, 2008

Book Review: The Ultimate Cheapskate's Road Map to True Riches, Chapter 1

I have been reading The Ultimate Cheapskate's Road Map to True Riches. The first time I read through it I wanted to highlight a bunch of things as I was reading because I really enjoyed a lot of what he had to say. So I thought I would review it chapter by chapter and how it applies to my life.

The first chapter introduces us to two main concepts he talks about in his book frequently. The Money Steps and the Enoughasaurus.

The Money Steps refer to the default setting for most people today. The assumption that we must earn money, to spend money, to get what you want. Kind of like a dance.

The Enoughasaurus is your inner beast that must be satisfied. Slaying or at least satisfying your Enoughasaurus is a matter of deciding what's enough for you and then designing your priorities around it.

These two concepts get expounded on more and more as you go through the chapters, really helping you understand how they apply in different areas of your life.

What I really like about the book is how he helps put things in context for you. The author, Jeff Yeager, used to work in the nonprofit sector, which I think helped ground him and give him real perspective when working with the ultra-rich donors and very needy clients--both sides of the economic spectrum.

Even with our relative wealth today, we have a negative saving rate that means we spend all our disposable income and MORE. We borrow money to spend money. And on what?

He offers up this get rich quick plan at the end of the chapter:

Housing: About 1.1 billion people have inadequate housing or none at all
Food: Worldwide 840 million people are malnourished, and 6 million children under the age of five die every year as a result of hunger.
Water: Some 1.1 billion people in developing countries have inadequate access to water, and 2.6 billion lack basic sanitation.
Education: Nearly 1 billion adults in the world are unable to read a book or sign their names.
Energy: On average, 1 American uses as much energy each year as 531 Ethiopians.
Automobiles: Worldwide 8% of all people own autos; in the US, 89% of all households own one or more autos.
World resources: As much as 30% of the world's resources are consumed by Americans who represent just 5% of the world's population.

Presto! You are already rich! Compared to a lot of the rest of the world you are extremely wealthy. Transplanted into a remote, undeveloped region of the world and you would be a freaking "Rockefeller". Even the poorest 1/5 of US households would be "well healed in that imaginary scenario".

Remembering that nearly 3 billion people live on less than $2/day makes you realize just how rich you truly are. You just didn't realize it!

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