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Your Money Ratios: 8 Simple Tools for Financial Security

3.77  ·  Rating Details ·  142 Ratings  ·  26 Reviews
A troubled economy calls for answers. Forget complicated, abstract philosophy—people need sound financial advice that's easy to follow and can be implemented immediately. For the first time, a leading financial adviser has developed a remarkable set of guidelines to give individuals the same kind of objective insight into their personal finances that successful businesses ...more
Hardcover, 272 pages
Published December 24th 2009 by Avery (first published 2009)
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Ben Hyrman
Nov 03, 2014 Ben Hyrman rated it liked it
I want to like this book.

The author has a solid grasp of safe withdrawal rates established by the Trinity study as well as realistic portfolio success rates based on historic periods. However, there is very much an assumption baked in that this book is targeted at someone working to full retirement age and then living on more than they were making while working. That is, work until you're 65 while living on 60% of your gross salary and then you can live on 80% in retirement. If your goal is to r
...more
Michael
Aug 08, 2014 Michael rated it really liked it  ·  review of another edition
A well-written and easy-to-follow book on personal finance based on a unique angle. It presents 8 ratios, or "rules of thumb" that you can follow to know where you stand financially, and to answer questions such as: Am I saving enough? Is this mortgage too much for me to afford? How much should I spend on disability insurance, or do I even need it?

The author has done a great deal of number crunching to present the ratios in the form of tables, where you simply look up your age and income to get
...more
Andrew Mutch
Jul 18, 2012 Andrew Mutch rated it it was amazing
Of all the personal finance books that I've read, this has been one of the best. The ratios described help you track your progress towards securing your financial future. Elegant in their simplicity, they rely on a hundred years of financial data to provide a reality check that ensures that you'll have enough money to provide for a secure retirement. Just as important, the author explains the steps you need to take to protect your financial resources through prudent investing strategies, using ...more
Lil' C
Jul 09, 2011 Lil' C rated it it was amazing
I stumbled upon this book on the "new books" shelf at the library and I'm so glad I did. It gave me a whole new perspective on finances. Prior to reading this book, the how-to of retirement planning was a very nebulous concept in my mind. But after reading the book, I feel like I now have a very good road map for approaching retirement, as well as other tools for financial security. This book is very practical. Farrell teaches you what you need to know about social security, investing, health ...more
Jack Cheng
This is a good beginning financial book for anyone who needs one, and a good check in for anyone further along in their financial life.

For me, I'm happy that it answers two questions that always nag me: do we have enough saved for retirement and how much should we save this year?

Farrell breaks it down into ratios: you need to save x times your income to maintain a good savings rate and you need to have x amount in the bank to retire comfortably at age 65. He also explains how he obtains these n
...more
Nathan Schwartz
Dec 28, 2015 Nathan Schwartz rated it it was ok
Most personal finance is really simple, and I love to see books strip it down to the very bare bones, but here there were just too many places where there were total palm-to-the-face errors. He uses a 5.5% expected return for treasuries, yes this is what treasuries have yielded historically, but you can be assured that you’re not going to earn that with treasuries that you buy in 2015. He suggests a 50/50 stock bond split for people as young as 20 years old. He suggests that people not invest in ...more
Allison
Aug 11, 2014 Allison rated it it was ok
I wanted to like this book, because the ratios seemed both conservative and easy to keep track of. However, the advice was just way too broad and simplistic (spend as little as possible on a car, for instance). When the author glossed over the differences between a 401k and a Roth IRA and implied that the tax advantages for both vehicles are pretty similar over the long haul, I stopped reading but did skim the rest of the book. If you're looking for a good intro to personal finance book, I'd ...more
Shayne
May 07, 2012 Shayne rated it it was ok
This book is one gigantic "rule of thumb", useful for people anxious about "how they're doing" financially. However, because it's set as a one-size-fits-all proposition, its utility is limited for anyone who "doesn't fit the mold" (e.g., retiring early, alternative retirement lifestyles, etc.). Seems to set a reasonable minimum bar for people who don't want to think too much about it; that's just not for me.
Tie Webb
Jan 27, 2016 Tie Webb rated it it was amazing
I have read a lot of personal finance books and this book is surely unique. It gives you perspective and helps you to keep the long view through out your career. Keep debt in check and don't over extend yourself. Just wish I would have read this book when I got out of college. Highly recommended.
ilham.mukhtar
Sep 27, 2015 ilham.mukhtar rated it it was ok
Quickly glanced the book. Capital to Income ratio, Savings ratio, and Investment ratio are recommended like it is cast in stone. not that it is particularly bad. It's rare that people would stick their neck out and firmly hold the magic number. In any case, worth to be considered in your personal finance implementation.

Not keen on the insurance section.
Sam
Sep 09, 2010 Sam rated it really liked it
A useful introduction to all of the financial considerations (e.g., retirement savings, life insurance, health insurance, etc.) a young professional should start considering. I now know what a 401(k) is, and how it is different from a Roth 401(k)!
Thorpe Obazee
May 26, 2016 Thorpe Obazee rated it it was amazing  ·  review of another edition
This is one awesome book. It gives a template on how to manage your financial life through simple ideas (ratios). The reasons for the ratios are quite good too. This will be one book I will go back to from time to time.
Beth
Jan 12, 2014 Beth rated it really liked it
I loved it. I have never seen a financial book that showed me how to balance what I might get in a pension-type funds with my style of living to find out how much I should be saving each year toward retirement.
Christopher Obert
Apr 07, 2010 Christopher Obert rated it really liked it
Shelves: read-2010
A very interesting book that will add valuable insight into your financial security. As the title states, the book is full of different ratios that will help you to better understand where you are, where you need to be before retirement. I found it to be most helpful…
Edison Teo
Dec 18, 2012 Edison Teo rated it liked it
not recommend if you are going into business or become an investor, but it is definitely a great book for the one in employment who like to "play safe" and minimize the risk of their retirement.
Denise
Feb 18, 2010 Denise rated it liked it
Wish I had been given this book when I graduated college. Great basic rules for becoming financially a capitalist vs. a laborer.
Frances
Jul 07, 2011 Frances rated it really liked it
Great book! Helps plan out where you should be financially at each stage so that you can retire comfortably.
Peter
Feb 26, 2011 Peter rated it really liked it
Commonsense advice and easy-to-use tools for getting on track towards retirement. For actual investment allocation, I would look more to someone like Bogle.
Mark
Feb 06, 2011 Mark rated it really liked it
I liked how the information was presented in this book. It was a very quick read that provided actionable advice to create a simple yet effective plan.
Robert Birnie
Aug 16, 2010 Robert Birnie rated it it was amazing
Very helpful and informative book. Not a one stop shop for all things financial but great overview of many topics and the ratios are great. I found it as a recommendation on the forums of mint.com
Andrew Chang
Aug 08, 2014 Andrew Chang rated it really liked it  ·  review of another edition
I like this for its simplicity and tables. Not sophisticated and technical to take you thru the back calculations that this must take, but good for the everyday person to hold some rules of thumb
Jesse
Jesse rated it really liked it
Aug 08, 2014
Kristen
Kristen rated it it was amazing
May 11, 2016
Janet
Janet rated it liked it
Sep 19, 2016
Chris
Chris rated it did not like it
Aug 08, 2014
John Riecke
John Riecke rated it it was amazing
May 29, 2016
Michelle
Aug 08, 2014 Michelle rated it liked it  ·  review of another edition
Shelves: finance
Read it when you are 20.
Justin Raby
Justin Raby rated it liked it
Jan 07, 2014
Ed
Ed rated it really liked it
Aug 28, 2013
Nathan
Nathan rated it really liked it
Oct 22, 2011
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