Every Sunday, The Simple Dollar reviews a personal finance or other book of interest. Also available is a complete list of the hundreds of book reviews that have appeared on The Simple Dollar over the years.

Whenever I stumble across a free opportunity to download a good electronic book, I usually do so. I archive it with the intent of looking at it at a later date, and sometimes I do just that, digging through that folder to see if there’s anything good in there.

As I mentioned earlier this week, my wife, Sarah, gave me a Kindle (an electronic book reader) as a Valentine’s Day gift, so this gave me the opportunity to dig back through my folder of archived free books. I loaded an awful lot of them onto my Kindle, and Money Girl’s Smart Moves to Deal with Your Debt by Laura D. Adams happened to be one of them.

This book isn’t still free – it’s now $1.99 on the Kindle store – but it’s got enough worthwhile information on it that I still consider it a spectacular bargain for many people. Who, exactly? Let’s dig through what’s in the book.

STEP 1: Assess Your Finances
The first step towards getting your debt situation under control, in Adams’ eyes, is to create wha che calls a “Personal Financial Statement” (PFS). A PFS is basically a balance sheet, where you list all of the significant assets you hold, as well as all of your debts. When you add up all of your debts and subtract all of your assets, you should wind up with a number which represents your net worth. Good financial choices, in general, improve your net worth, and poor ones decrease your net worth. You can thus use this PFS as a way to judge the life moves you’re making. Adams also gives advice on valuing all of your assets, such as using a blue book value for your car, and the need for updating this PFS very regularly (and comparing it to past balances).

STEP 2: Make a Debt Reduction Plan
Once you have that, the next step is to develop a debt reduction plan. In other words, take that list of debts from your PFS and determine how exactly you’re going to eliminate them. Adams distinguishes between good and bad debts (using the term “dangerous” to distinguish the bad ones) and lumps credit cards and all short-term debts into the bad portion, encouraging people to pay those off first, and leaving others (like mortgages and student loans) in a second pile to be dealt with once the first ones are gone. Within each pile, prioritize: Adams suggests primarily organizing by urgency (are there any that are late?) and then by interest rate, with the highest rate getting paid off first.

STEP 3: Reduce Your Short-Term Debt
The first step to take here is to look for assets (on the top part of your PFS, from step one) that you can sell or eliminate in order to wipe out the worst short-term debts, giving you some breathing room. Downgrade your car, for example, and use the proceeds to eliminate some very nasty debts. Once you’ve figured out what you can sell to help with the debts, focus on negotiating your way out of debts. Try to get your rates reduced by calling the credit card companies. If you have debts in default, call them up and offer to settle for less than what you owe. You can also try juggling rates by using balance transfer offers, which will almost always result in some significant rate reduction on your high-interest debts.

STEP 4: Reduce Your Long-Term Debt
The big step here is to refinance your home mortgage if you’ve not done so. If you have a fixed rate mortgage over 5%, you should strongly consider a refinancing. The first step in this process should be to ask your lender for a loan modification, however, as banks are often quite interested in doing so at this point. You might also want to switch to bi-weekly payments for your loans, paying half of your monthly payment every two weeks. This simple step can have a huge impact in reducing your overall debt. A final suggestion is to consolidate your student loans, ideally to a fixed rate loan (because they’re so low right now).

STEP 5: Create a Spending Strategy
From there, turn your attention to how you spend money. Keep an ongoing list of where every dime you spend goes, and try to categorize them into sensible categories. Then, look at the categories that are non-essential and try to put a reasonable cap on them that pushes you to save a little without drowning the life you enjoy living. There’s a balance to be achieved here.

STEP 6: Eliminate Expenses and Save More Money
From there, strive to cut any expenses that you can. Look at all of your regular bills and ask yourself if there are any that can be eliminated or significantly trimmed, such as a satellite bill or a cell phone bill. Ask yourself if there are one-time things you can do to reduce other bills, like installing a programmable thermostat or putting in some energy efficient light bulbs. The more you can eliminate or reduce your expenses, the more money you’ll have to eliminate short term (and, hopefully, long term) debts.

STEP 7: Reduce Your Taxes
The biggest tip is to be aware of any and all credits and deductions available to you. I find that the easiest way to do this is to use a computer program like TurboTax when doing your taxes, which identifies credits and deductions that are available for your situation. Another great tactic is to start doing some tax-deferred retirement savings. If you open up a 401(k), you’ll be putting in pre-tax money, which means that the total amount of income you have that can be taxed will be lowered, lowering your federal, state, and local taxes.

STEP 8: Manage Your Credit Score
The first step is to check out your credit report using the free tools given to us by the federal government. Make sure you know and understand everything on that report, and if you don’t, make the effort to figure the unknown items out. Such a report can clue you in to any identity theft that may be happening, as well as give you a good indication of what your credit score will look like (few bad things means a good credit score). The better your credit score, the better your insurance rates are and the easier it’ll be to get good rates on consolidation loans and the like.

STEP 9: Protect Yourself
You should always be on the defensive about identity theft. Be very careful before sharing any of your identity with others, particularly companies that aren’t well established. Another thing to consider is bankruptcy if you’ve tried the above tactics and still can’t get your head above water. Bankruptcy sounds devastating, but it at least gives you a chance of escaping from your mistakes over the course of several years rather than continuing to drown.

STEP 10: Stay Out of Debt Forever
The book offers a short coda here encouraging people to stay on this new path even when their debt goes away, channeling their money instead into building streams of revenue that will eventually lead them from having to work and giving their life a great degree of freedom.

Is Money Girl’s Smart Moves to Deal with Your Debt Worth Reading?
This book is heavily tied into the Money Girl podcast, one of many podcasts under the Quick and Dirty Tips podcast collective. Each of these podcasts is just a short burst of advice and information on a specific topic. They usually last just a few minutes, focus on a very specific topic in a friendly and entertaining but non-personal manner, and are released very regularly – much like an audio form of many blogs out there.

As you’d might expect, Money Girl’s Smart Moves to Deal with Your Debt basically uses this exact same philosophy in book form. It’s short. It focuses on a handful of specific points in fairly brief chapters, using a friendly and entertaining but non-personal approach. It gets the point across for someone who is in a hurry and might be reading such things on the subway on their way to work, for example.

If you’ve ever wanted to drop some personal finance sense on a young professional who is the type who has their hours overstuffed and finds that the only time they have to read is using their Kindle or other reading device on the subway on the way to work, this is going to be absolutely perfect for them. In fact, I would probably just go ahead and gift this book to them right now on their Kindle, so it’ll pop up for something for them to read. (You can, of course, read it on PCs and tons of different mobile devices).

It is just what you’d expect it to be. It’s not deep and meaningful, like Your Money or Your Life. It’s not deeply personal, either, like my own recent book. It’s just the facts, short and friendly, and for many people, that’s just what they need.

Check out “>additional reviews and notes of Money Girl’s Smart Moves to Deal with Your Debt on Amazon.com.

Brent sent me a great email earlier this week:

Have you ever noticed how a lot of the articles you write could easily appear on a religious website trying to convert nonbelievers? Just switch a few things around and you’d be there.

Instead of telling people to read Your Money or Your Life, you’d tell them to read Mere Christianity or something. Instead of telling them to save money, you’d tell them to save their own souls. Instead of life insurance, you’d talk about the afterlife.

Either way, you still talk in reverential tones about the wonderful life you’ve found after your transformative moment and encourage others to “convert.”

What you’re doing is basically evangelism.

Brent does a great job of pointing out the similarities between enthusiasm and evangelism, and he makes a few good points. However, I think there are a number of key differences between promoting good personal finance practices and religious conversion.

First, one can simply and empirically demonstrate the value of better financial choices.

If I go into a grocery store and show how you can buy the ingredients for a certain boxed meal separately for a much lower price, that’s a clear demonstration of the value of that financial choice.

If I can look at the history of various investment types and use those to conclude that index funds are a strong investment choice for people who don’t have time to do so, I can present that conclusion with data.

If a person can pay off a mortgage much faster by making half of a monthly payment every two weeks, then it makes sense to do that.

If one can go to the HR depertment of a large corporation and hear from them that a powerful portfolio of projects is likely to sway their attention, then it makes sense to recommend that new workers fresh out of college do this.

It is much more difficult to make such statements in the realm of the religious or spiritual. Such things rely heavily on faith, and regardless of how much a person might believe, you can’t force another person to share the faith you have. You can show them facts, but you can’t make them believe.

Second, financial success is not a black and white issue. With most religions, it is black and white. With Christianity, you either accept Christ or you do not, for one.

With personal finance, it’s much more about the thousands of behavioral choices you make each day. No one makes all of the best financial choices every day, but with some education and some forethought, people can reverse the course of enough of those decisions to make a real difference in their overall finances. Not only that, many of the individual decisions aren’t black or white themselves, such as choosing the right investment strategy or deciding whether to repay a debt or leave an emergency fund in place.

That’s not to say there isn’t some overlap – of course there is. There is overlap between religious evangelism and anything a person is proud enough or passionate enough about to tell others. All of these things have key books worth reading. All of them have best practices. All of them have big goals to shoot for. All of them can cause a person to gush passionately about it. Many of them can certainly contribute positive things to a person’s life.

I am absolutely certain that good personal finance practices have changed my life for the better. I can show you in great detail how little choices saved me money, how that saved money was channeled into debt repayment, and how a lack of debt drastically increased our household’s monthly cash flow. I can also tell you how those changes have reduced my personal stress level and introduced me to many new activities and things that I now hold dear in my life. To me, that’s something worth sharing.

Condi writes in:

Six months ago, I almost had my children taken away from me because I didn’t have enough money to pay any of the bills and keep food on the table for my children. It was the worst time of my life and since then, I’ve cleaned up my act. I’ve stopped drinking and smoking. Rather than just getting food on the way home each night, I’m making food at home for my kids. I spend time with them and I now see that they aren’t babies any more and they’re turning into wonderful young kids. I’ve been reading a lot about money too and I’ve started paying off my credit card debt.

The problem is that now I see that everyone in my life besides my kids acts the way I acted for most of my adult life. They all drink and most of them smoke and they all eat out or grab fast food for every meal. They’re all in credit card debt. A lot of them basically ignore their wonderful children.

I’m scared of losing all of my friends. I’m also scared of changing back into the person I was, too. I don’t know what to do.

I felt more sympathy for Condi’s email than I have for almost anyone who has ever written to me. The huge amount of personal fortitude and willpower she has shown over the past six months really is impressive. Anyone who can change that much of their life in a positive way that quickly earns my respect.

Still, Condi’s journey isn’t over. She’s still in an environment that is almost begging her to relapse into her old patterns.

Condi, I strongly suggest that you consider doing five things.

Get a complete fresh start
Move to another area where the routines of daily life are different than what you have right now. Move far enough away so that you don’t interact with the same people every day and aren’t surrounded by the old social circle and environments.

This might seem incredibly daunting, but it’s often not as daunting as you think. If you work for a large chain business, for example, they will often help employees relocate to other branches. Since you currently have employment, you can take your time with regards to finding a new job. I would start preparing now, however, so that when you do find one, you can easily move. You might also want to consider moving in the summer if your children are of school age so you don’t interrupt their school work.

You don’t necessarily have to move across the country – two hours of driving distance will do. What you’re seeking is a new normalcy – a new set of routines that don’t involve many of the influences that would pull you back into bad habits.

Don’t be ashamed to seek help
I’m not sure what your actual income situation is, and I’m also not sure if you have an adult partner at home to help you right now, but in either case, there are many programs out there that exist for the sole purpose of helping people in situations like yourself. Don’t be afraid to use them, and don’t fall into a mindset that other people need the help more than you do. Some examples: WIC offers assistance to low-income women and young children who may need some additional nutritional support; your local food pantry; job training programs; and energy bill assistance.

Again, I don’t know the specifics of your financial situation, but I do know that it sounds like it might be tight to make ends meet all the time and that, in the past, you’ve been unable to do that. Don’t be afraid to seek out services that can help you as you continue to right your financial ship.

Engage in new activities
Instead of filling your time hanging out with old friends or doing the things you used to do (which can lead to temptations you don’t need), try seeking out new things to fill your time.

What have you always wanted to learn more about? What skill have you always wanted to learn (like knitting or basic home repair, for example)? Go get a library card, take your kids there with you, and check out some books.

Are you in the shape you’d like to be in? Start taking walks in the evening. Get a portable radio with earphones (that’ll only cost you a few dollars) for something to listen to as you walk.

Are there any big projects in your home or your life that you’ve wanted to take on, like cleaning out and repainting a room? Start doing those kinds of things in bits and pieces in the evening.

If you’re in a large city, look for groups that are involved in these things you’d like to explore and join those groups. Sure, the people you meet might be different than what you’re used to, but that’s a good thing. Go in there feet first and just open up and introduce yourself to everyone there. Good things almost always follow.

One thing I almost always encourage people to do in situations like yours is to try out a volunteer group. Take your kids with you to a Habitat for Humanity house some Saturday or to a soup kitchen. Get to know the people there and learn how to pound a nail – and maybe teach your kids to do it, too. Meet some people who are trying to do positive things in their life, too.

While these seem like hard things to adopt, once you do so, you’ll begin to feel really good about how you’re spending your time. You’ll grow as a person – and the people in your life will see that, too.

Be proud of your successes
You have accomplised an amazing amount already. Yes, in the future, there will be difficult moments where you don’t feel as happy with the changes you’ve made and old routines will seem very appealing.

No matter how much others want you to feel bad about the changes you’ve made, don’t. They’re awesome changes.

That doesn’t mean you have to go tell everyone how great you are. Being proud doesn’t mean being boastful. Keep it inside yourself, but know that there are people out there who are absolutely impressed with your accomplishments – and know that you’re in a better place because of what you’ve accomplished, too.

Remember that true friends will stick
One challenge that remains whenever you make a serious life change is losing the relationships you already have, which (of course) you value. It’s an extremely painful proposition: on the one hand, you’re improving your own life, but to get there you have to lose relationships you’ve built and valued over time.

It’s important to remember that the relationships that really matter will stick with you. If these people do not genuinely care about you, they’ll stop being involved with your life once they realize your interests have shifted. That’s an extremely superficial friendship. It is very easy to build those kinds of acquaintances in whatever area of interest or course of life we spend.

The valuable ones will stick with us for years and years and years. I’ve known my closest friends in the world for more than half of my life, and they’ve seen me change (and I’ve watched them change) many many times over those years. We stick together because we matter to each other.

The rest? Well, a person can always find more people to hang out with.

Good luck, Condi!

Each week, I highlight ten things each week that inspired me to greater financial, personal, and professional success. Hopefully, they will inspire you as well.

1. The Office on careers
A reader (thanks, Jamie!) pointed me towards a wonderful quote from the original British version of the television series, The Office.

[I]t is better to be at the bottom of a ladder you want to climb then half way up one you don’t.
- Dawn, The Office [UK], Season 1, Ep. 6

You’re better off taking a low-level job that excites you than a mid-level job that drains your will to live. I essentially did that with my own writing career and it’s the best thing I’ve ever done for myself. I might have lost income, but I gained the joy of being a more involved father and husband.

2. Blind painter
If this guy can figure out how to express himself through painting, it makes my obstacles to my own goals seem pretty small.

How did he do it? “I needed to find a way of drawing that left a raised? line that could be felt with the fingertips rather than being seen with the eyes. After much experimenting and failure I found that by using a matte fabric paint I could draw fine lines that were permanently raised and that dried very quickly – almost instantly when hit with a heat gun. The method is very straight forward, but does require patience.” That’s from his website.

If you can’t see the embed above, here’s a link to YouTube.

3. Desktop Tower Defense
I’d love to be able to create a game that was this elegant and addictive. I find myself playing this almost daily even now, and I discovered it first in circa 2004.

Give it a shot at Hand Drawn Games.

4. Tony Dungy on effort
Tony Dungy, the former NFL coach, had a great line about success in his book Quiet Strength:

“The truth is that most people have a better chance to be uncommon (successful) by effort than by natural gifts. Anyone could give that effort in his or her chosen endeavor, but the typical person doesn’t, choosing to do only enough to get by.” – Tony Dungy

The thing that separates the great from the average isn’t God-given talent most of the time. It’s effort. I like to think of it this way: if Michael Jordan’s basketball talents were handed to him on a silver platter, why did he get cut from his eighth grade basketball team?

(Thanks, Sherri, for pointing me towards this quote and the book!)

5. Cosmos
Over the last few weeks, I’ve re-watched the wonderful television series Cosmos. Here’s the intro:

You can watch the entire series on Netflix streaming (which is how I watched it). I remember vividly watching this as a child, and I enjoyed it at least as much now as I did then. Sagan has an incredible way of explaining the wonder of the natural world.

6. Warm weather
This past week, the temperature rose above 60 F two different days. I spent a good deal of both of those days outside, soaking up a lot of fresh air and a bit of indirect sunshine. It felt really, really good and made me yearn for summer.

Sunshine, a warm day, and fresh air really are wonderful things.

7. Francis Bacon on goals and focus
“A person who aims at nothing is sure to hit it.” – Francis Bacon

If you don’t have any goals, it’s pretty impossible to reacn your goals, isn’t it? Instead, you wander aimlessly, hoping to stumble in some sort of positive direction. When you strive for nothing, you’re sure to accomplish it!

8. Friendship
I have three friends that bring more value into my life than I can ever express. I don’t often mention them directly on The Simple Dollar and I don’t mention them by name in order to help with their privacy, but you three – J., M., and R. – add more to my life than you’ll probably ever know. Thank you so much.

9. The Last Lecture redux
An old friend of mine sent me an email this week in which he said “I just watched that Randy Pausch Last Lecture video again. Made me think about how I’ve spent the last few years.”

So, I decided to watch it again, too. Still powerful. Still inspiring. Well worth watching and reflecting where your life has recently gone and where it’s going.

10. Thoreau on goodness
“Goodness is the only investment that never fails.” – Henry David Thoreau

If you want to always have good things in your life, treat others well without fail. Be respectful of them by keeping yourself clean and your language polite. Be kind when you can, particularly when you can easily do so. The more you do this, the more positive the world around you will become, every single time.

Dinner With My Family is taking a one week hiatus due to a cavalcade of visiting family and an inability to get good pictures of a meal. Tune in next week for the series’ return.

On Monday, Sarah gave me a wonderful Valentine’s Day gift – a Kindle. I’ve had a great deal of fun playing with it all week long.

Unsurprisingly, within a day of having the Kindle, I found myself spending lots of time online looking for great free resources for the Kindle. What books and other materials are out there for free for Kindle users?

Since I’ve received many emails over the years from Kindle users – and I know at least some people subscribe to The Simple Dollar using a Kindle – I thought I’d share some of the best resources I’ve found, both this week and over the years.

If you don’t have a Kindle but think you might own one someday, bookmark this page.

Feedbooks
http://www.feedbooks.com/
Good for a smattering of free current novels and many well-known public domain classics
Feedbooks is a source for purchasing electronic copies of books readable on the Kindle, but the site also offers a huge selection of free works, including quite a few well-executed copies of public domain literature. Generally, what you’ll find here are very good versions of the more well-known classics, whereas Gutenberg (below) has a much wider selection but some of the less-well-known items can sometimes have minor issues (extra punctuation and so on). I particularly enjoy the new free releases section, where unknown authors give away a novel or two in order to try to make a name for themselves; you can find all kinds of things in there!

Five free quick picks from Feedbooks: The Ware Tetralogy by Rudy Rucker, Accelerando by Charles Stross, Down and Out in the Magic Kingdom by Cory Doctorow, The Idiot by Fyodor Dostoyevsky, and Wuthering Heights by Emily Bronte.