Stop Over-Thinking Your Money!: The Five Simple Rules Of Financial Success

by Preet Banerjee

Personal finance is a lot like physical fitness. In order to be in better shape, everyone knows they have to work out and eat well. A personal trainer delivers results, not by showing clients a new way to perform sit-ups, but rather by simply making sure the sit-ups get done. In Stop Over-Thinking Your Money!, Preet Banerjee explains the financial equivalents of what exercise and diet you need to know in order to be in top financial shape. There are so many buzzwords in the world of money that most people’s heads spin, their eyes glaze over, or they tune out altogether. It can be overwhelming, and for many of us, it seems like there is just too much to know so we don’t get started on taking care of our money. The good news is that of all the information out there in the world of personal finance, at most you will only ever need to know about 20 percent of it. That small amount of knowledge is what will put you ahead of most Canadians.

In Stop Over-Thinking Your Money!, Banerjee explains in five simple rules how to think about money and focus on the 20 percent of what you really need to know to confidently take charge of your money.

Genres: Finance, Nonfiction, Personal Finance, Money, Business

224 pages, Paperback

First published November 27, 2013

Reviews

[Jacob · Rating 3 out of 5]

The breadth of this book seemed a bit odd to me. On one hand, you have the five rules, which are very basic:
1) Disaster proof your life
2) Spend less than you earn
3) Pay down high interest debt
4) Read the fine print
5) Delay consumption

Most of these points should be no-brainers (but aren't, which is why these basic personal finance books exist and people are so massively in debt). I didn't get anything new from them except for in chapter one, his argument for purchasing disability insurance, pointing out that 1/3 will become disabled for longer than 60 days before 53. While disability benefits are paid by the state in Canada (as they should be) they are woefully inadequate for today's cost of living ($1600/m). Worthwhile looking into as both my parents had health issues as I was growing up and both needed to go on disability for 1-3 years each, so it's something I think about (rather than thinking it could never happen to me).

The second part of the book is good at explaining the differences between stocks and bonds. It goes into different types of investment portfolios, whether you should have an investment advisor and how to find one, and gives more information about life insurance (I felt the earlier information was sufficient for me, and while the history of insurance piece was mildly interesting, it wasn't very applicable to me). The second part of the book was much more complicated (had to re-read a few parts to start to grasp them as I am not inclined to be a numbers person) and almost seemed at odds with the 'well, duh' simplicity of the first half.

Also, while I understand the appeal of the 'financial management is like getting in shape' analogy, it was super sizeist. Working out doesn't mean you're going to become thin and have a six pack as Banerjee suggests (this is largely genetic) just like investing doesn't mean you'll be a millionaire. The better analogy is that if you do any physical exercize on a consistent basis, you will likely see improved health markers (with or without change in body shape/size); on the financial side, if you follow his five basic rules, you probably won't be a millionaire but you are likely to have better financial health than you started out with (if you were not already doing these things).

[Said Abdirahim · Rating 1 out of 5]

If it were possible for me to not give this book any stars, I would have taken the opportunity to do so.

Preet Banarjee’s “Stop over thinking your money” is simply a book filled with useless antic-dotes, and information most individuals are extremely familiar with.

There was little to no elaboration on the points being made, and I would recommend not picking up this book.

[Andrêa Hamana · Rating 4 out of 5]

Very good finance book.The investment part is tof to understand! But the more i read, the more i understand.

[Alexa · Rating 3 out of 5]

I wanted to read a few finance books as I review my financial plan for the year (and beyond).

This one is good at vaguely going over most concepts of financial planning. Not many details involved. It's a good introduction to a lot of the concepts.

I like that it's Canadian. And I like that the author doesn't just go over investing - he explores more areas of financial planning, like setting up insurance policies, a will and POA - which I think isn't discussed or emphasized enough in most finance books. So big props for that.

[Marian · Rating 4 out of 5]

This book may look thinner than other financial planning books, but it’s quite packed with a lot of knowledge. There are some sections that are very basic like the part 1 where he talks about the five rules to achieve a financial success. However, in later chapters where he talks about the investment and insurance there are some heavy concepts that are worth taking notes.

The five rules that he teaches are not new. They are very basic concepts that most people who pay attention to their own finances might be already following. Although some parts of those chapters seemed obvious, I also found some sections to be good reminders and inspirations to improve on the implementation of those basic rules. As the author says, don’t over-think and just do it, then, you will have a decent financial standing.

In order to achieve phenomenal financial success, readers are directed to many personal blogs and websites that the author recommends. So, this book isn’t intended to be solely used by itself, but it’s more of an introduction to the vast world of personal finance literature.

The author’s financial knowledges shines in part 2 of the book where he talks about investing and insurance. He defines many common terms used by financial advisors which could help beginners. My favorite part of this section was on the different ways of how financial advisors get paid by selling mutual funds. I was always curious about it but when I asked my financial advisor I never received an answer as detailed as how it was described in the book. He explained the deals between the advisor and the manufacturers of those mutual fund to help readers understand where those fees were originated.

The book will be a good introduction to beginners and provide good inspiration and tips to intermediate investors. I highly recommend this book.

[Ashley · Rating 4 out of 5]

I liked Banerjee's no-nonsense approach to money in this book. There are a fair few good finance books that I've enjoyed reading because of their simplicity and straightforward approaches, and Banerjee takes the cake in those categories here. Sometimes it's easy to get bogged down in all the "extra" stuff that we forget financial skills at their most basic, which is what Banerjee is reminding us of in his book. The only reason I give this 4 (more like 4.5) instead of 5 stars is because there are a couple of sections in which you have to make the connections between them yourself (not balking at work here, but since his aim is simplicity and directness - and he clearly has a grasp of the financial books already out there - he needs to address those connections more clearly). Certainly a small criticism given the value of the book. Definitely recommend.

[Andrew · Rating 5 out of 5]

This should be one of the first books read by any Canadian interested in learning about personal finance. There is often too much emphasis placed on investing info because it's more interesting for a lot of people, but not enough attention is paid toward other things like having proper insurance coverage. This book covers all the fundamentals you should know about to get a solid start.

The five core topics are discussed first, followed by more detailed info (especially about insurance, which was surprisingly not such a dry read).

My only gripe is that some of the digital links and resources Preet mentions are now no longer available.

[Sherry · Rating 4 out of 5]

I like to read books on how to manage your money just to keep brushed up on the process. I like this book it is very straight forward and easy to read. It hits all the usual subjects and added a couple extra that I had no thought of before. I recommend it to anyone who feels that their money is out of control but don't expect the book to fix it you still have to do it yourself it just gives you the tools to do it.

[TechVision · Rating 4 out of 5]

Great book that covers the fundamentals or "easy A" towards achieving financial success. The initial 5 parts covers things for the basics of insurance, emergency funds, decreasing debt, surplus spending, and handling credit. However, the most interesting chapters for me were those regarding financial advisors (purpose, how to pick an advisor, when to get one, etc) and the specifics on life insurance. Overall, a solid book that covers the fundamentals, as well as some more advanced topics.

[Ian Khan · Rating 3 out of 5]

A really good and quick read for Canadian novices looking to get their financial house in order. I did appreciate the emphasis and rationale on insurance as a part of a sensible financial plan. While I did appreciate the brevity, I think many will find this book too court and wanting Preet to unpack a lot more and go into further detail. I did appreciate all the resources and book recommendations made in this book, should you decide to go deeper on any subject matter.

[Barrett Lafortune · Rating 3 out of 5]

This is a quick read and serves as a very light introduction to Canadian Personal Finance. I enjoyed Preet's writing and the topics he chose to discuss in the book. I'm also a fan of Preet's work on youtube and his podcast appearances.

My only issue with this book is that I think there are other books that do an even better job of introducing Personal Finance for Canadian Beginners. One example that comes to mind is Dave Chilton's The Wealthy Barber Returns.

[Cedric Nicholson · Rating 3 out of 5]

The book was basic principles and had some good points but one thing it was missing was a call to action when it comes to increasing your finances. He mentioned your basic investment strategy but missed the point on other MSI stategies. I felt it was a telling people to live mediocre instead of pursuing more.

[Heather Clark · Rating 4 out of 5]

I really like his common sense approach to finance and emphasis on progress over perfection. The first half of the book was useful and compelling information about the financial basics. The second half goes into greater depth on investments, financial advisers and insurance and will be less relevant to some. Some of the information later in the book is specific to Canada.

[Mike F · Rating 5 out of 5]

The five rules in the first half were surprisingly simple. Actually following through on these rules and taking action is not so easy though.

On the other hand, I found the second half to be surprisingly complex - more information and detail than I was expecting.

Overall, a relatively easy read, even for me :)

[Katelynne · Rating 5 out of 5]

This is the "kick me in the ass to do some financial cleanup I have been putting off". I'm not in any consumer debt but have been floating in a weird financial space and I needed this simple, straightforward "get your act together girl" read

[Thảo Nguyên · Rating 4 out of 5]

At first I thought the book is about investing . But it turned out that the book is more about insurance and personal finance. I found this book on The Canadian Couch Potato's bookshelf and really enjoyed the read.

[Cheryl · Rating 5 out of 5]

An absolute great read for people early in their career and earning money for the first time. Really helped me figure out the beginning of my career, how to invest, what to focus on etc - a great gift for a recent graduate too.

[Jonathan Doam · Rating 4 out of 5]

A valuable book nonetheless. I get that Banerjee may have wanted to remain impartial on certain highly-debated topics (i.e. life insurance) but would have appreciated to learn more about his perspective and how he'd weigh the options.

[Eric · Rating 2 out of 5]

Does talk a little bit too much about the physical body as an analogy. Good sections of insurance and so so for everything else. I appreciate his brevity though.

[Lori]

Two and a half years later, I have finished this book!

[Anik · Rating 5 out of 5]

Very informative! Worth to read especially for the insurance chapters.

[Jignesh · Rating 3 out of 5]

If you are starting your career this is a good book. The section on insurance and how the cost work is excellent.

[Sean · Rating 4 out of 5]

Good breakdown of five key areas on investing in Insurance itself. Something I need to consider looking into for life insurance using the basics that they have provided within this book

[Patrice Maltais · Rating 5 out of 5]

First, as a disclaimer, let me say I know Preet personally. That being said, when we meet, we talk about cars and racing.

I have one more reason to admire Preet's skills as he made me read an entire personal finance book. By that I mean I bought the book, sat down and read the entire thing on my own (it's not like he was standing over my shoulder waiting to see what I thought). I bought more than a couple personal finance books over the years, but I honestly don't remember finishing one. Before long, my eyes would glaze over and I'd be more confused than anything about what to do with the little money I had. For the most part, those books were getting very technical very quickly, assuming I had mounds of cash to invest or that I was confortable with options and derivatives. I thought they were skipping the basics, or assuming too much of their readers.

Preet assumes you are intelligent, but also human. He approaches it as if, like most people, you mean well and you're intelligent enough, but you're confused about what to do with your money. He also rightly assumes a lot of people of my generation (X) and younger have grown in a culture that didn't stress enough the importance of saving since interest rates and inflation have always been so low for us (well, except the 80s, but we were in high school then, so the focus on the stock market and real estate was low to non-existent). So Preet takes you through the basics. Whether it's your first time or if you've been around that corner before, you'll pick up important stuff here, and lots of common sense and straight talk.

Turns out I was doing several things right, but a couple of things not so well. This book helps you get a simple plan together to get you well on your way to financial security, and it provides you with tips on where to look if you're ever interested in options, derivatives and the likes. I strongly recommend this book.

[George Wenzel · Rating 3 out of 5]

For a personal finance book, this one's a quick read.

Preet's five rules of money are solid, however the book seems disorganized. The first half is devoted to exploring the five rules in turn, but it feels like there's a lack of depth to that exploration. After that is a section called 'Beyond the Five Rules" that takes up the second half of the book. It's as if the latter half of the book was written to expand the book so that it would be longer than 100 pages.

The first half explores the five rules, which are:

1: Disaster-Proof your life (have adequate insurance and legal documents in place, in case you die prematurely or your house burns down)
2: Spend Less Than You Earn (so that you'll have a surplus to save)
3: Aggressively Pay Down High-Interest Debt (so that it doesn't cost you for your lifetime)
4: Read the Fine Print (so you don't get burned by details in a contract you sign)
5: Delay consumption (until you can pay for it)

I was a bit shocked by Preet's assertion (page 99) that debt, particularly vehicle debt, is a necessary evil. He describes car debt as an "almost inescapable item". I disagree entirely - there are plenty of reliable used cars on the market for around $5000, and that's not an outlandish sum for somebody to save up over the course of a few months.

There was some value in the latter half of the book, though. If you're looking for a good explanation of various types of life insurance and why they are priced differently, you'll find that. There's also a detailed outline of how to pick a financial advisor. Preet's careful to mention, though, that for most people those are advanced subjects. In Preet's lingo, they're the "A+" material, but mastering the five rules will give you an A.

Not a half-bad personal finance book. Worth the quick read.

[Drew Canole · Rating 3 out of 5]

All the basic stuff is here: Make sure to save (don't spend more than you need to), invest in low-cost index funds, avoid expensive funds, aggressively pay down high-interest debt etc etc

He also adds in some interesting stuff (for me at least):

Disaster-Proof Your Life - he strongly recommends getting disability insurance, life insurance, and an emergency fund together. Making sure you have enough disability insurance is a great idea, just make sure your worst-case scenario doesn't ruin you.

Delay consumption - this can help with spending less. I just saw an interesting short by PewDiePie (who of course can afford whatever the hell he wants). In it he explains when he was young saving up and buying the latest pair of sneakers was exciting. Now it's boring. So instead he owns just 1 pair of shoes which he wears until their completely ruined... so now he's excited to go grab a new pair! It's a brilliant way to avoid hoarding unnecessary shoes and make it just as exciting to get a new pair as it used to be. I'm going to try and do this with books! I used to be excited when I got a new book, now I have enough cash I don't care at all - any single volume I can just go online and get shipped to my door. So now I'm going to make sure any book I buy is the next book I read. No more hoarding books (wishful thinking at its finest!).

[Promod Sharma · Rating 4 out of 5]

Personal finance gets equated with investing and budgeting. Yes both are important, but there's more. This book reminds us that we get most of the results by getting the basics right — once we know what they are.

Preet shares five simple rules for success with money.
1. Disaster-proof your life
2. Spend less than you earn
3. Aggressively pay down high-interest debt
4. Read the fineprint
5. Delay consumption

These rules may seem "obvious" and you've probably heard variants before. Even so, the rules are sound and require discipline to follow. The stories help in understanding and remembering the lessons.

The first rule gets ignored often. Disaster-proofing your life isn't glamorous but essential. We need disability insurance to replace our income if poor health prevents us from working and life insurance to provide for our families if we die. We know this but do we have adequate protection in place?

This book is easy to read. It's valuable whether you're learning the basics or an expert looking for a fresh perspective. You may get reminded or jarred into changing your money habits.

[Karen Falck · Rating 5 out of 5]

Wow. I was thoroughly impressed by this book and took a lot of notes. It is split into two sections, the first section consists of the 5 rules of success to get you that easy A in financial success, and the second is the investment knowledge that can help you get the A+.

I am no stranger to budgeting and saving intellectually. I've read books, articles, and gone to seminars, but there are some obstacles to implementation that no one has been catching. I feel that they have been addressed here and I'm now going to have more accurate tracking of expenses and better adherence to the desired budget.

Also I appreciate the insurance, wills/POA, and contract advice, since they are often overlooked in money books but certainly contribute to financial peace of mind, which for me is the true objective.

The second portion, in addition to general investment information, gave me the knowledge I need to find a good financial advisor and understand what's going on behind the scenes. I'm much more confident that I'll have a clear picture of all the moving parts when investing.

This has been a very easy read for a money book, very well written. Thanks Preet.

[Jonny Phake · Rating 5 out of 5]

First time reading a book like this. Really liked a bunch of his YouTube clips.
Recommend for anyone wanting a little education around personal finance. Particularly if you live in Canada.

[Blair Conrad · Rating 4 out of 5]

A good basic introduction to people who may be overwhelmed by the idea of managing their money. I was slightly turned off at the "Stop reading and go get a will. Don't read another word until you have done that.", and worry that others might be as well. However, most of the rest of the first section was very good. Presenting very few rules, and really keeping them simple could be just the path that people need.
I was surprised at the extra content at the end, which was generally good, and covered some more advanced topics, but was probably included just to make the book long enough that it could be sold…