Dollars and Common Sense is a must-read for all individuals who are trying to save money and be successful in today’s tough investment markets. Peter Andresen believes that it is possible to become financially secure and even wealthy, by following the principles and lessons outlined in his book.
Who would not want to go on great vacations without going into debt? Or, who would not like to be able to buy an emergency item without going into debt? We would all love that kind of security. There is no secret formula or magic bullet. It will take hard work and discipline. Yet, we could all have that kind of peace of mind with a bit of planning and saving consistently.
For Andresen, there are 10 commandments of investment for success. They focus on how to budget, reduce debt and save, manage our irrational emotions around spending and investing, knowing that hard times will be with us from time to time and not to panic about them, being cautious with our investments, and only investing in mutual funds. In addition, we must “weed the garden” annually to find the best possible mutual funds, recognize and avoid investment bubbles, and rebalance our portfolio a few times a year.
Each of these commandments will point to how we can not only survive but thrive in this difficult time with a bit of planning, persistence, and discipline. And this is good news given the fact that many of us feel so downtrodden and we lack the discipline to do some of the things that we must to become financially secure.
I loved Andresen’s book from beginning to end. I especially loved his emphasis on the importance of managing our irrational mind vis-à-vis money. Most of us have bought into a faulty model of borrowing and overspending that is eating up our bank accounts.
We spend more than we make consistently, and we are consumers at heart. Nothing is ever good enough for us for more than a year at a time. We want to buy all the technological gadgets we can get our hands on, even if we don’t need them. This causes us great financial distress.
These spending habits have become a part of our identity much to our detriment. In fact, to continue overspending the way we have is financial suicide, and it must stop. Andresen shows the reader how to change this negative mindset to a much more positive and financially feasible and thriving mindset. We can all take charge of our investments and spending habits. All we need is to want to become financial fit and secure.