I’ve mentioned time and time again on The Simple Dollar that there is one personal finance book that, in my eyes, stands out above all the others. It certainly changed my perspective on money – I read it just as I was becoming aware that I needed to turn my financial life around and it was truly a life-changing read for me. I wound up writing a ton of commentary and supplementary material about the book, simply because it was so profound to me.

That book is Your Money or Your Life by Joe Dominguez and Vicki Robin.

At the time I read it, it had been in print without significant revision for more than a decade. One of the authors, Joe Dominguez, had passed away in 1997, and in order to maintain his vision, the book simply stayed in print without significant change for many years.

By the time I read the book in 2006, many of the numbers in the book were quite outdated, as were some of the cultural references and specific frugality tips. This didn’t really bother me too much – the value of the book doesn’t come from those things.

This brings us to today. Very recently, the “other” author of Your Money or Your Life, Vicki Robin, issued an updated version of the book, adding an additional author (Monique Tilford) and promising to be “revised and updated for the 21st century.”

Many Simple Dollar readers wrote to me and asked if the new version was significantly different than the old. Does the new one offer some additional insights? Did the new version change the meat of the message?

For the most part, the new version of Your Money or Your Life is unchanged from the previous versions. There are quite a few updated statistics throughout and some of the cultural allusions have been modernized or changed.

However, there are two big exceptions to that rule – one good change and one bad change (in my opinion).

The good change is the revision of the final chapter, which discusses investing. In the old version, Dominguez and Robin prescribed an extremely conservative plan for investing, telling readers to stick to bonds and little else. From my perspective, this advice was the weakest part of the original book. Such an undiversified investment strategy is in itself risky – it’s the equivalent of putting all your eggs in one basket.

This time around, the investment advice still leans towards the conservative, but it actually provides a more well-rounded view of investing, including several pages discussing index funds. The general message is that you should balance your investments, but move primarily into more conservative investments as you approach retirement.

The bad change, though, comes in chapter six, which focuses on tactics for cutting your spending. In the earlier version of the book, this chapter featured a list of 101 specific frugality tips, most of which still worked quite well (though a few were dated). I fully expected that this list would merely be refreshed for the new edition.

Instead, though, this list of tips was entirely cut from the new edition. Replacing it is a twelve page discussion of different areas of frugality. While this discussion is worthwhile, it doesn’t work nearly as well as the specific tips of the earlier version. The specific tips were urgent – given the material that had come before in the book, you were ready to jump up off the couch and get started on this stuff, and those tips were the perfect starter material. The newer material doesn’t have that urgency – it’s a solid discussion of frugality, but it doesn’t make you want to jump up and get started right away.

Don’t get me wrong – the revised version of Your Money or Your Life is at least as good as the older version. The minor revisions (that basically eliminate the “dated” feeling) and the rewritten chapter on investing easily outweigh the unfortunate changes to the frugal living chapter, and the underlying message is still as powerful as it ever has been.

There is still no personal finance book I would recommend before Your Money or Your Life. It’s the best one I’ve read.

Still, I know from my own experience that I was really inspired to try out frugality by the tips given in the sixth chapter – it was really the single thing that got me interested in frugality. I can’t help but wonder if the new version would have inspired me in the same way.

Imagine, just for a moment, that you find yourself on a desert island with just you and four or five of your closest friends and relatives – the people you care about the most in this world. The only people around are the people that care about you.

On this island, you can have whatever house you want and the items you want to have. But you’re just on this island with just the people that care about you. No one else will see you. Judge you. Draw conclusions about you.

What house would you actually own? Would it be a large, ostentatious house, one designed to impress the neighbors and the people you might invite over? Or would it be a small one that just meets the needs that you have, nothing more, nothing less?

What stuff would you have? What things would you actually want with you? Would you have all of the stuff you have now, the decorations and other items you have mostly to impress others?

Spend some time thinking about this. What would you really want to have if no one was there to judge you? Would your closets be jammed with clothes? Would you have a shiny new car or the latest electronic gadgets?

Here’s the real truth of the matter: the difference between the items you’d have on the island and the things you actually have now is the stuff you’re buying solely to impress other people.

If you own a shiny new car now, but would drive a junker if just your family were watching, you’re spending money just to impress other people.

If you have a closet full of expensive clothes, but would always wear jeans and a t-shirt around the people close to you, you’re spending money just to impress other people.

If you have a bunch of nifty electronic gadgets that you love to show off but never use, you’re spending money just to impress other people.

If you live in a big beautiful house in a big beautiful neighborhood, but around your core people you’d be happy in a tiny house that didn’t demand upkeep, you’re spending money just to impress other people.

Here’s the truth, though. For the most part, those other people don’t matter. Not a bit. Sure, you need to dress to match the culture of the place where you work and so on, but many of the things we buy we do so to impress others.

The next time you’re tempted to make a major purchase – say, anything over $20 or so – ask yourself who you’re buying it for. Are you looking at that giant flat panel for you – or to impress the boys? Are you tempted to get that gorgeous car because it’ll turn heads – or just to get you back and forth to work? Are you eyeing that huge house just to see the reactions on people’s faces – or because you actually need 3,500 square feet?

Then remember this one thing: the people who really care about you don’t care how big your television is or how shiny your car is. They care about you – are you happy and secure in your life? And the surest way to add a lot of stress to your life is to buy something you really can’t afford and be stuck with payments on it for a long time.

Make a real effort to separate what matters to you from what you think matters to everyone else because, in the end, it’s you that you’re left with at the end of the day. It’s you that will be worried at night if the bills pile up.

Fleeting three-second opinions of others don’t matter. What matters are the real relationships we build – and those aren’t bought and sold with a big screen television.

One of the best concepts from Your Money or Your Life is that of the fulfillment curve. Basically, the idea argues that there’s a sweet spot for anything that maximizes the fulfillment you get out of it. If you spend more, your fulfillment starts to actually decrease.

I often reflect on this concept. I see it popping up again and again in my own life and I find that if I put in some effort finding that peak fulfillment, my money just falls into line right behind it. I’ve come to believe that if a person has their basic needs covered, overspending is caused by going over the far end of the fulfillment peak.

I hinted at these ideas a while back, when I discussed the book in detail:

The middle portion of the first chapter focuses on the “fulfillment curve,” which basically refers to the idea that once you reach a certain level of luxury in your life, anything beyond that level is merely diminishing returns.

My conclusion at that time was to tie it to consumerism and clutter:

One of the deep problems of consumerism is that the average American tends toward buying more. They would rather have more stuff that, per item, they have less time to enjoy than less stuff that, per item, they have more time to enjoy.

This is connected directly with the clutter problem, also discussed here. This tendency to buy extra luxury items gradually fills a home with lots of clutter – unnecessary stuff that just sits there taking up space when the money invested could be used to help build a more fulfilling life.

Later reflection has led me to believe that it’s not necessarily these factors. It’s more of a matter of finding balance, akin to riding a bicycle.

Here’s a visual example of the fulfillment curve (I’ll explain the numbers below):

Let me give you two examples of how the curve works, both pulled from my own life.

Example #1: Video Games
1 – I’d like to play some video games, but I don’t own a console or a single game.
2 – I own a console and a single game, which is quite a bit of fun, but it gets boring after a while.
3 – I pick up one game a year from the used game store. After the three month mark, though, I’ve beaten the game and then I feel unfulfilled until I get another game several months later.
4 – I pick up a game every three months from the used game store, right in line with when I’ve mastered and am getting tired of the previous game. I always have something fresh to play and master and don’t have to spend too much keeping up with the hobby.
5 – I get a game every month from the used game store. It isn’t financially pinching me, but I’m building up a pile of games I’ve barely played.
6 – I get a mix of new and old games, two or three a month. I can handle my credit card bills, but it’s a little higher than I like. I also don’t like looking at that pile of unplayed games.
7 – I buy a new game every week. I play it for about five minutes, then I feel guilty and I put it on a giant pile of games that are barely played, making me feel really guilty. I do it so I can play the “latest and greatest,” but I usually just feel really guilty, and I’m having a very difficult time keeping up with the credit card bills.

See the progression there? That middle point – 4 – is where I’m really enjoying a hobby that I have. I can easily afford it, I get to thoroughly enjoy each game I get, I have plenty of new stuff to play to keep me happy, and I have no guilty feelings about it. If I spend less, I’m not enjoying my hobby as much as I’d like – I feel longing. If I spend more, I start to build up games that I don’t play, I build some guilt, and eventually it gets really expensive.

My experience with video game fulfillment A few years ago, I was somewhere around 6 on this fulfillment curve. When I finally went through my big financial panic, I veered wildly in the other direction, selling everything and rushing back over that fulfillment peak to 0. As our financial life became stronger, I slowly climbed the curve and now stand fairly close to that peak – #4.

Here’s another example (with a picture of the curve again, for visual aid).

Example #2: Home Buying
1 – We’re essentially homeless. We live in our car.
2 – We live in an extremely cheap, extremely small old apartment. The rent is extremely cheap, but there’s barely enough room for sleeping space for everyone or room to do anything at all. We’re embarrassed to have guests at all.
3 – We live in a nice apartment or a small house. There’s enough room for everyone to sleep and have meals, but we’re sometimes pinched for space and there’s more clutter than we’d like. We have some of our friends over, but we feel pretty self-conscious about the place and don’t have the dinner parties we’d like.
4 – Our house is just the right size for our family. We feel comfortable having any and all guests over, the housework doesn’t overwhelm us, and the bills are completely manageable.
5 – Our house slightly exceeds what our family needs, but it gives us some room to grow. The bills are slightly painful, but we can manage things. We spend a bit more of our weekends on home cleaning and maintenance than we’d like, but we feel quite proud giving dinner parties and inviting people over.
6 – Our house is a McMansion. We can afford the bills, but just barely, and only if we eat everything at home. The bills make me feel kind of guilty, and there are times where it feels like all we do is upkeep.
7 – We bought a house nine times our annual income on an ARM and it just adjusted. Our house is mind-blowingly awesome, but we’re getting foreclosed tomorrow. We have no equity and we have no idea what we’re going to do. I wish we’d never come here.

My experience with housing fulfillment When we first got married, we lived in an apartment that was probably about a 2.5 on that curve – we were buckling down and saving. After our first child was born, it slipped down to about a 2 – we were in a serious space pinch and we became sort of ashamed to have guests over because of the massive clutter. We bought our first home and now we’ve happily settled in at about a 4, but we looked at some homes that would have been a 5 or a 6 on the curve, I’m quite sure. I think this house might slip to a 3.5 or a 3 if we have two more kids, but we’ll cross that bridge when we get there.

Some Fulfillment Curve Thoughts and Strategies
What does this curve mean in your own life? How can it help you get ahead? Here are some suggestions.

The fulfillment curve applies to everything you spend money on. The basic principle applies to almost everything in your life, from food to clothing to shelter up to hobby-oriented activities. In almost every aspect of life, the point of maximum enjoyment is not the point of maximum spending – spending too much reduces fulfillment.

Guilt is one of the surest signs of the downside of the curve. If you feel guilt about your spending in any area, you’re likely spending more than your natural fulfillment peak. It’s likely that if you take the time to seriously look at every area in your life where you feel some guilt about money, it’s a result of spending too much to try to chase fulfillment. Pull back on that spending some and you’ll almost always find that things become more enjoyable as a whole.

Your fulfillment curve peak might actually come with spending no money at all. For example, I almost always find that when I spend much money on extra things for my kids, neither one of us gets much extra fulfillment out of it and a good chunk of the time I feel like I shouldn’t have spent the money. Here’s an example: the best time I’ve spent with my kids recently was last Sunday when we went to the library, went to a free art festival, then went home and read books for an hour. The cost was virtually nil, but it was a peak on that curve. Fulfillment curve peaks don’t have to cost you.

Routine frivolous purchases – like a $5 coffee each morning – are beyond the peak, whether you actively notice it or not. If you do it every day, it’s no longer a treat. It’s not something special to really bring you fulfillment. Try drinking cheap coffee at the office all but one day a week. You’ll find that the one good coffee you do drink brings you far more fulfillment than it used to.

Spend some time understanding what things really fulfill you. I feel much more fulfilled by a well-designed item that will last basically forever than just about anything. Reliability is really a strong fulfillment point for me – I tend to like things that I’ve had for a long time that still work like new. That’s why I often do so much research before a purchase – I know I’ll get more fulfillment out of it if the item just does its job reliably and easily.

Good luck applying the fulfillment curve to your own life!

Just this morning, I was leafing through my favorite personal finance book of all, Your Money or Your Life, when I came across the idea of the “purge and splurge” cycle. From page 148, discussing what happens after you start buckling down and paying serious attention to your financial state:

In the first month of recording your figures you might confront one of our national foibles. Your income entry might well be lower than your expense entry. You may have spent more than you earned. (It is, after all, the American way.) Seeing this reality might come as a bit of a shock. Chances are you’ll want things to change – and change now. Accustomed to budgets, diets, and New Year’s resolutions, you swear on a stack of bank statements and credit cards that next month will be better.

This is when people often go on a “wallet fast” with the kind of zeal characteristic of first-time dieters. They scrimp. They save. They deprive themselves and their families, putting everyone on beans, rice, and oatmeal rations. They concentrate daily on that expenses line, determined to cut it in half in one short month. Amazingly enough, many do. Entering the expense figure the second month, they proudly note a steep decline.

This kind of austerity, however, isn’t sustainable. By the third month expenses often rebound with a vengeance, making up for the second month deprivation.

Now what?

I’ve been there. Have I ever been there. In the years before my financial meltdown, I went through this “purge and splurge” cycle several times. I’d have one month where I really cut back and saved a lot of money, then I’d “reward” myself in the next month by massively overspending on unnecessary stuff. When the bills came in, I’d panic again and go into belt-tightening mode, just to toss it all out the door once again.

There were several big things that I was doing wrong, though – things that I didn’t see at the time because I didn’t really understand how personal finance worked. If you’re having trouble escaping this cycle, just as I once did, here are some techniques to try.

Use a longer period for evaluation. Don’t just look at your spending over one month – that doesn’t really matter. Instead, look at your spending over a long period, like six months, and compare that to your income over that period. The short term really doesn’t matter that much – the difference is made over the long term.

Focus on not just avoiding spending, but changing the underlying behaviors that lead to spending. During those belt-tightening periods, I’d still go to bookstores and electronics stores, but I’d walk out the door proud of myself for not spending. The problem was that I was still in the mindset of a consumer – I would still go into the stores, tempt myself, and just use sheer willpower to pull myself away.

There’s only so much pure willpower can do. Use that willpower instead to change the habits that tempt you. Don’t use willpower when you’re in the store drooling over a new goodie – use willpower to decide to take another route home from work every night so you’re not tempted to stop in.

Make changes that are hard to undo during the belt-tightening phase. That’s the perfect time to cancel your credit cards or freeze them up in a big block of ice. Call up your service providers (your cell phone company, your cable company, etc.) and cancel some of the services. Look at your monthly bills and see what else you can trim that will take action to undo. Doing these things will ensure that some of the savings will remain with you, even if your resolve weakens a little.

Set tangible goals on a very regular basis – and keep setting them. Don’t just promise to trim the fat. Set a clear numerical goal to reach and, when you reach it, set another goal for the next month. If a month is hard for you, set week-long goals: I won’t eat fast food this week, for example. Make the goals very concrete and clear so that the things you need to do for success are obvious, then just keep setting them over and over again. Eventually, the techniques will become natural to you.

If you make a mistake, don’t follow it with another one. So you splurged. That doesn’t mean it needs to be followed by more splurging. Recognize that you slipped and then go back to your goals. The point is to keep generally heading in a good direction – everyone slips up on occasion. The winners, though, are the ones who don’t use “I splurged already, so it doesn’t matter” as an excuse to splurge even more.

Investigate new, inexpensive things that you like to do. One big problem that people have when following a newly frugal lifestyle is that they get bored. They wonder if pinching pennies is all there is to life, and they get tempted to spend. My advice is to do some research and load yourself up with as many free and inexpensive activities as you can find. Look up your community calendar and plan for events for the next two months. Check out a series of books from the library. Keep trying things that don’t cost much until you find things that bring you a lot of enjoyment, then start using those things as your regular recreation.

Just a few pages later in Your Money or Your Life, Dominguez and Robin nail the most fundamental key of all:

There are two keys to making this process work for you:

1. Start.
2. Keep going.

That’s really it – success in a nutshell.

Each Friday, The Simple Dollar reviews a personal finance book.

I’ve been looking forward to reading this book for a while. Getting a Life is a pseudo-sequel to Your Money or Your Life, which I absolutely loved and have referred to countless times on The Simple Dollar. Although it’s written by different people, it’s endorsed by the authors of Your Money or Your Life and they wrote the introduction to this book.

So what’s different about Getting a Life? Rather than setting forward a conceptual plan, as Your Money or Your Life does, this book focuses on how people have applied the plan in their lives. Most of the people discussed – including the two authors, Jacqueline Blix and David Heitmiller – are people who defined the 1980s definition of “yuppie” in that they fit perfectly the luxury consumer-oriented upper middle class of today.

Does this book provide any revelations? It did, but not necessarily in the direct way that I expected. Let’s go through the book and see…

Digging Into Getting a Life

The book opens with an introduction by Joe Dominguez and Vicki Robin, the authors of Your Money or Your Life, that offers an interesting argument for why thriftiness became “uncool” during the last half of the twentieth century, and most of it boils down to time famine and affluenza – in other words, a desperate sense of not having enough time and the desire to buy stuff to fill that hole. I basically agree with this argument, as I was basically a consumer spending addict not all that long ago and I still definitely feel that my life suffers from a time famine as I sit here at 4:30 AM writing this review.

1 – The Way We Were
The book opens with David and Jacque telling their stories of a life of overspending, coming from two completely different perspectives. Jacque started off in an upper middle class home with a father that held a white collar job, enjoying all of the trappings of that life and coming to expect such material lavishness. David, on the other hand, started off rather poor in a small town and held strong “back to earth” environmental principles, but eventually abandoned them after the death of his first wife. Reading the stories, I identified a lot with David, as much of the story sounded like the first few years of my professional life.

2 – Psychology of the Good Life
Of course, that lifestyle has some psychological downsides, and this chapter addresses those. Both Jacque and David found themselves with various negative feelings in relation to their lifestyle, from Jacque’s therapy to David’s continual need to keep finding bigger and better thrills. Over time, these aspects added up to a general malaise in their life, an overall sense that all of the material goals that they were chasing weren’t really filling any hole in their life.

3 – Seeds of Change
For both of them, the seeds of change were planted by watching friends and relatives pass away at a young age, requiring them to come face to face with their mortality. They also both realized that in order to maintain their lifestyle, they would both have to work until near the very end of their expected lives, leaving them no retirement to enjoy together. More specifically, Jacque began to really investigate aspects of consumer culture as part of her new job in academia and the conclusions of those investigations left her rather unnerved. This eventually led them both to discover, first, The Tightwad Gazette, and then Your Money or Your Life. This chapter, like the others, tells many stories beyond just that of Jacque and David, but they all had a common thread – somewhere in all of their lives, something had happened that had planted a seed of change, something I’ve really been digging into as of late.

4 – Before You Take the First Step
This chapter is basically a reader’s guide for how to approach Your Money or Your Life based on how a lot of others have read it before. The suggestions mostly revolve around reading it and trying things out that make sense to you first and not just blindly following the order given in the book, and also doing it together if you’re in a couple-based situation. I agree strongly with the latter and have been hinting at my wife to read the book with me sometime soon, although she’s already on board with most of the ideas presented.

5 – Stepping Through the Steps
This portion of the book is eighty eight pages in length, easily the longest chapter in the book. The length is largely due to the fact that it cut-and-pastes most of the highlights of Your Money or Your Life right into this chapter. In fact, if you wanted to just read that book in a nutshell, the highlighted sections of this chapter would do that for you. This chapter deals mostly with how different people have worked through the nine steps presented in Your Money or Your Life, offering tons of examples of what things look like for real people. If you are interested in the plan but really wish you could find others interested in following it, too, this chapter might really be a help.

6 – Your Money or Your Child’s Life
I found this to be the most enjoyable chapter in the book, mostly because I’m quite drawn lately to issues of personal finance dealing with children, as I have two of them at home with the oldest just starting to become aware of money and of the pervasiveness of consumer culture. The conclusion here is pretty clear, and had crossed my mind before: the principles of Your Money or Your Life are quite applicable to parenting. In fact, many of the changes I’ve made in my own life (and in the lives of the people in the chapter) were triggered by children – it is incredible to consider the sheer impact that a child can have on every aspect of your life.

7 – Who Am I Now?
Getting a Life really taps into an interesting underlying issue here, looking at how individuals define themselves. For many people in the United States, our job is the definition of who we are – and that is often a complete misrepresentation of who we actually are. Shouldn’t we define ourselves by our passion and where we’re moving with our long term goals? Lately, in non-professional conversations, I’ve come to refer to myself as a freelance writer, nodding to both this site, to MSN, and to a few other places. I’m not quite there yet to make it my livelihood, but it’s what I’m passionate about. Even though it’s not my primary employment (and that’s why I find myself writing at 4:30 AM), it is an employment and it is something I’m incredibly passionate about.

8 – Your Money and Your Health
This is perhaps the biggest leap in the book. Here, the argument is that getting your financial and personal life in order is incredibly valuable for your health, as it vastly reduces your stress and often improves the quality of the food you eat and the exercise that you get. While I agree with this in principle, I don’t think that living a simpler life is a direct route to better health. Better health is a series of choices that a person makes, often quite independent of other factors such as voluntary simplicity. I would agree that choosing a simpler life is one of those health-affirming choices, but I think it’s a bit overstated here.

9 – Simplifying Life
This is perhaps the most practical portion of the book, offering a huge number of very specific suggestions on how to live a simpler life. Some of these overlap with the suggestions from Your Money or Your Life, but many do not. What I found particularly interesting is that not all of the advice is strictly cheaper in terms of raw dollars and cents, but they all do lead towards a simpler existence. A few of the suggestions hint at other concerns as well, such as pointing towards organic products and hints of fair trade products and a blanket avoidance of “convenience foods.”

10 – The Way We Are
As the book begins to wind down, this tenth chapter gives an excellent picture of the impact of frugality on the financial lives of couples, even giving a balance sheet for their monthly and annual expenses. What these people have discovered – and show as clearly as can be shown in a book – is that frugality opens the door to countless opportunties in life. If you’re able to not spend much, then you’re not required to chase a high-salary job that stresses you out. Instead, you can chase other goals, ones that are more in line with your passions and talents.

11 – Getting and Having a Life
The book closes with a point that many people overlook when evaluating such major changes in life. Even though this plan offers a lot of benefits, it’s often still not very easy, and that’s because we’re human. We make mistakes, we tend to overanalyze at times and underanalyze at others, and we often trick ourselves into thinking we’re doing the right thing when we’re not. The key is to let it go – just try to live your life in the best way you understand, don’t worry about the small mistakes unless they become endemic, and practice making good decisions until they become natural to you.

Buy or Don’t Buy?

If you thought the pieces of Your Money or Your Life that talked about elements of the plan in the lives of others were incredibly powerful, Getting a Life is a must-read. While it wasn’t the amazing experience that the original book was, I found Getting a Life to be quite enjoyable on its own. Perhaps it’s because I enjoy reading about how others apply ideas in their own lives – and I enjoy writing about it too – but parts of this book really hit home for me.

On the other hand, if the real-life examples in Your Money or Your Life weren’t very powerful to you, you can skip Getting a Life. This book really does consist almost exclusively of discussions of how real people implemented Dominguez and Robin’s book, and if that sounds unappealing to you, this book is going to be a waste of time.

If you’ve never read either book, unquestionably read Your Money or Your Life first. While I found some pieces of this book to be quite powerful, it’s really only powerful in the sense that I was able to see how others had used Your Money or Your Life in their own lives. For that alone, I’m glad I read it, but the power wouldn’t have been there without reading the original first, thinking about it, and attempting to act on it.

This is the thirtieth and final part of The Simple Dollar Book Club reading of Your Money or Your Life. Want to know more?

Your Money or Your Life has done more than any other book I’ve ever read in terms of changing how I view money. It truly brought to life the connection between the choices I make every day and the greater decisions I make about my life, and it opened my eyes to the value of frugality and day-to-day personal responsibility about my financial bottom line and that of my family. I really can’t pay it any higher compliment than that.

To me, the one single factor that makes a book essential is that it significantly affects your thinking and/or your actions. In other words, a book becomes essential solely due to the effect that it has on readers. Regardless of the quibbling disagreements I had with Your Money or Your Life over specific details, it has arguably had more impact on my life than any book I’ve ever read.

When I first read it, I was already realizing that I needed to get my financial life in order, but I didn’t see the real connection between money and daily life. I was stuck deeply in a mindset of I work, I get paid, I work some more, I get paid some more. This book revealed to me that such a routine doesn’t really have to be the plan and, in fact, isn’t entirely healthy. Now, I view life as work to do stuff I like and minimize the expense of it all so I can have more time to do stuff I like. Money is nothing more than the tool you use to maximize the time doing stuff you like.

That doesn’t mean I wholeheartedly subscribe to everything in this book. I feel, as many readers do, that in many places the political views of the authors come into place quite strongly, with a lot of environmentalism and a bit of New Age touchy-feely type material. The book also could use a much stronger section on investing advice, as that advice really only applies to people who are on the verge of having enough money in the bank to live off of the interest in a extremely secure investment – not advice on how to get there.

But that’s not the point.

The point of the book is to encourage people to rethink their life choices from the ground up in a very tangible fashion, something that very few books manage to pull off. In fact, the connection between the abstract (living an alternative lifestyle) and the concrete (figuring out exactly what that costs) is the core of the genius behind this book, and it’s why it is the only personal finance book I’ll universally recommend to any reader.

If you’d like to review all of the readings in the book club reading of Your Money or Your Life, here’s a list of each reading and a link to all twenty-nine discussions. This is a great page to bookmark if you’re thinking you may read through the book at some point in the future.

Prologue (pages xxiii to xxxviii)
The Money Trap (pages 1 to 9)
Prosperity and the Planet (pages 9 to 21)
The Beginning of a New Road Map for Money (pages 21 to 29)
Step 1 – Making Peace with the Past (pages 29 to 39)
Money Ain’t What It Used To Be (And Never Was) (pages 40 to 59)
Step 2 – Being in the Present and Tackling Your Life Energy (pages 59 to 75)
Where Is It All Going? (pages 76 to 87)
Totaling It All Up (pages 87 to 108)
How Much Is Enough? The Nature of Fulfillment (pages 109 to 112)
Three Questions That Will Transform Your Life (pages 113 to 128)
Assessing the Three Questions (pages 128 to 145)
Seeing Progress (pages 146 to 157)
Getting Your Finances Out in the Open (pages 157 to 165)
The American Dream – on a Shoestring (pages 166 to 171)
Ten Sure Ways to Save Money (pages 171 to 181)
101 Sure Ways to Save Money (Part One) (pages 181 to 197)
101 Sure Ways to Save Money (Part Two) (pages 197 to 212)
Additional Thoughts on Cutting Spending (pages 213 to 218)
For Love or Money (pages 219 to 231)
The Stunning Implications of Redefining Work (pages 232 to 246)
Valuing Your Life Energy – Maximizing Income (pages 247 to 258)
The Crossover Point (pages 259 to 268)
The Power of Working for a Finite Period of Time (pages 268 to 279)
The Freedom to Choose What You Do and Do What You Choose (pages 279 to 291)
Now That You’ve Got It, What Are You Going To Do With It? (pages 292 to 305)
Three Pillars of Financial Independence (pages 305 to 318)
Cushions Make For Softer Landings (pages 318 to 327)
Additional Resources (pages 337 to 343)

This is the twenty-ninth part of The Simple Dollar Book Club reading of Your Money or Your Life. Want to know more?

The book closes with an excellent list of resources for materials related to the themes of Your Money or Your Life. I investigated several of these and found a few well worth noting if you found the concepts in this book worthwhile.

Several of the online resources mentioned in this section wound up eventually pointing to yourmoneyoryourlife.org, where you can download a whole pile of resources if you explore the site a bit. Some of the resources require a small payment, while others were free. The biggest drawback is that the site appears to have been designed circa 1995, meaning it looks low-tech and the navigation is pretty confusing.

The best part of the Resources section was an extensive recommended reading list, of which I’ve already read and reviewed two: The Overspent American by Juliet Schor, What Color is Your Parachute? by Richard Nelson Bolles, and The Complete Tightwad Gazette by Amy Daczyzyn. I quite liked all three of these books, especially the latter two, and I’m going to use this as something of a “recommended reading list” for future book reviews here on the site.

I’ve also been trying really hard to find a copy of Getting a Life, the less-heralded follow-up to Your Money or Your Life. It’s supposed to be an application of the material in Your Money or Your Life, where a rather materialistic couple actually applies the material to their own life. In other words, it’s an anecdotal complement to Your Money or Your Life, and I hope to review it soon.

The collection of additional online resources is also rather sparse and outdated. Several of the sites appear to be defunct and only one really appealed to me and provided thought-provoking information. Frugal Corner (http://www.frugalcorner.com/) was a rather interesting list of frugal resources, and I wound up following a large number of the links on that site to other resources, even though perhaps a third of the links are dead (again, it’s an old resource). Still, you’re far better off reading online personal finance blogs and frugality blogs than following these links.

In all, the resource list was somewhat outdated, but it’s useful to look at as merely a recommended reading list. I found several items I plan to read in the future from this section.

Tomorrow, I’ll give some of my closing thoughts on the book.

This is the twenty-eighth part of The Simple Dollar Book Club reading of Your Money or Your Life. Want to know more?

Finally – the last section of the book itself. Although this “book club” isn’t quite finished, this is the last piece of actual text from the book, as today’s reading finishes up the ninth and final chapter, leaving only an epilogue (which just recites the content of the book), resources, and notes.

Your Money or Your Life finishes up with several small pieces, the first one being a brief discussion strongly in favor of a cushion (one of the three pillars from yesterday). A cushion, if you’ll recall, is an emergency fund – an amount of very liquid cash that you have on hand in the event of a major crisis.

Cache, on the other hand, is much more interesting. When you reach the crossover point and quit your “real” job, Your Money or Your Life argues that your personal expenses will drop to at least some degree, leaving you with a continuing surplus even after detaching from your job. This is cache, which is effectively money you can channel into your later activities. For example, let’s say you quit your job so you can start making wooden rocking horses in your wood shop, selling some to rich families and donating others to all kinds of charities. The business would likely pay for itself and a little more, but the cache would allow you to keep making horses even during December, when you might give away every rocking horse you make.

Alternately, you might just spend the money entirely on charitable giving, or use some of it to pay for equipment for whatever you do. The point is that cache will exist in your post-financial independence life and it’s money you can use to really make a difference in the lives of others. After all, you are truly financially independent, right?

Your Money or Your Life closes with a brief discussion about a potential future where everyone jumped on this train, and looks at the societal changes it would bring. Interestingly, it looks like a capitalist boom – unemployment drops, productivity rises, urban sprawl and urban decay lessen, volunteerism and social activism grow, and consumerism decreases. Sounds like a pretty good world to me; I think that if everyone jumped on board the full philosophy of Your Money or Your Life, it might be bad, but an increase in people doing things this way might be good.

Tomorrow, we’ll look at the “Resources” appendix to see if there’s anything else of interest out there related to this book. This section appears on pages 337 through 343 in my paperback version of the book.