Tuesday, January 12, 2010

Book Review : The Smart Cookies' Guide To Making More Dough Chapters 1-3

The book I have chosen to review is:

The Smart Cookies' Guide To Making More Dough : How Five Young Women Got Smart, Formed A Money Group, and Took Control of their Finances By: Jennifer Barrett

I first saw the Smart Cookies on Oprah awhile back during the airing of her Debt Diet Series. I was instantly drawn to their story because they were close to my age and Canadian! They were a big hit and even started their own TV show helping others with their finances. I have watched several episodes when I caught it on TV and enjoyed each one, so when I saw they had a book out I had to read it.

I have to say that if I had read this book about 8-10 years ago it would have made a greater impact on me as back then I would have been part of the target audience for this particular book. However, this book is a great beginner's tool for someone looking to improve their finances and in my opinion targeted at young professional types without children. Most of the women of the Smart Cookies are in their 20's, single or recently married, no kids and all work in some sort of office or professional environment. Needless to say the chapters provided great discussion questions which are still a great exercise despite your financial expertise or situation, so I will post the questions and my answers over the next few Tuesdays.

Here we go!

Chapter One: The Taboo Topic: Starting the Conversation About Money


1) Have you ever talked about your finances with anyone else? If no, why not? If yes, who? And how did the conversation go?

I have had serious conversations with my husband about money. They usually always seem to go well until he sees something he desires than the "budget" becomes the enemy to us. To him he feels restrained and to me I feel guilty I cannot give him what he desires. We are working on finding middle ground on this weekly. We now discuss finances each and every Friday to make sure we are on board and up-to-date.

2) What do you feel is your biggest financial weakness?

This is a tough one. I guess guilt from others is my biggest weakness. Guilt mainly comes from my husband but also from my kids, family and friends. Most people I know do not operate on a budget (and they are almost ALL deeply in debt or the opposite very well off) and all seem to spend money quite frivolously. It's not often we are asked to go out for a night with friends but if we do get asked you can bet it will cost a lot when you factor in dinner, drinks and a babysitter so it makes it difficult to decline. Right now we are grappling with the decision about a Valentine's double date we are invited too at $30/person (dinner and comedy show) plus drinks, etc....

3) What would you most like to change about your current financial situation?

I would LOVE to be debt-free!

4) What advice do you wish you’d gotten earlier?

Stick to a budget. Save at least 10% of your income. Live within your means. Debt is bad. The list goes on.

5) What do you hope to gain by reading this book and/or forming a money group?

I have no intention of forming a money group, but I hope to maybe discover other financial tidbits that I might not yet be aware of.

Chapter Two: Know Your Numbers: Four Facts You Need To Know about Your Finances


1) Where does most of your discretionary money go each month? Why?

I just started giving myself an allowance this January. We agreed upon $10/week to be paid out on the first Friday of every month. So far I have spent $5.00 of my $50.00 and have already regretted it. My first purchase was a bad one - 2 cigars for New Year's for myself and husband. We both are ex-smokers but like to have the occasional cigar. We were going to split the cost of these but I ended up smoking both of them myself (bad, I know) but truthfully I wanted them gone from our possession before they became a habit and I hate to waste things so I couldn't bear to toss them. I will not be buying them again anytime soon. The next purchase was a Woman's World magazine which was quite normal for me to pick up during a weekly visit to Wal-Mart. I clip all the crafts and recipes and file them away in binders. I soon realized this magazine was going to drain my allowance fast so I have now hung on to my cash.

2) Can you think of an impulse purchase you made and regretted later, or an occasion when you spent money out of guilt or obligation?

Well the above answer can answer the first part of this question. I often have spent money out of guilt or obligation in the past. If someone buys me a gift I feel obligated to reciprocate. When I worked in the bank I was constantly asked for money for someone's retirement, or to sponsor, or charity, etc. I hated that. HATED it, but I usually gave something.

3) What’s the most you ever spent preparing for a date?

Wow since I've been married for almost 5 years its hard to think back on my "dating years". One time my friend and I were dating two guys that were best friends and the guys were organizing a romantic double dinner date for us. We decided to go and get our hair done at a salon and we most likely bought ourselves new clothes. I'm sure we spent quite a bit.

4) What is your most prized possession? Why?

Aside from photo albums of my kids and wedding I have to say my laptop. It allows me to keep my life organized in so many ways.

5) What would you like to be spending more money on? Less money on?

I'd like to spend more money on vacations. I'd rather spend money on great memories than material things. I'd like to spend less money on eating out on weekends. We do a lot of little trips to McDonald's for a quick breakfast (like muffins) or quick lunch (like $1.69 burgers) but all the little trips add up. If we could save this allotted restaurant money we could afford a nice family dinner out which would be more satisfying.

Chapter Three: Whose Life Are You Living? How To Create (& Afford) the Life the You Want

1) How is your life different than you’d imagined it would be at this age?

I never thought in a million years I would be a stay-at-home mom. I was raised to think that women that stayed at home were "lazy" or "lucky" which in reality was just my mother's own jealously. I grew up believing that if I wanted to have a good life I would have to work. I wasn't until I actually did my own research that I realized it made no sense for me to be in the workforce while I have small children, it would actually cost me money to work! To work at a place that I hated.

2) How do you envision your life in one year (or in five)?

In one year my life won't be much different. Small changes include - debt paid down significantly, Zack in school EVERY day and Avelyn 100% potty trained. Those are all great changes I am looking forward to. I so tried of cleaning poop. In five years - debt will be long gone, mortgage paid down significantly, savings for Disney, great savings for RESPs, possibly look at selling our house and moving to a bit bigger place.

3) What about your life now brings you the most and least amount of joy?

My kids bring me a lot of joy. I get excited for every summer because we can have new adventures together as a family and its gets better every year they get older and more responsible. The least amount of joy comes from the debt. I also hate cleaning the bathroom. That's a joy killer right there.

4) What would you rather be spending more, or less, money on?

I'd rather be spending more money on paying off the debt, vacations and education savings. I rather spend less money on child support for Jenna but that's stuck with us for many, many years. It's not that I don't want her to have any money, its just frustrating handing over money each month to someone you don't necessarily like (or trust) and believe she is using all the money for my stepdaughter and not fueling her own lifestyle. It would be awesome if we were responsible for buying her clothes, or school stuff, or deposited money into a trust account for college that we can say yes that went directly to Jenna.

5) What would you rather be spending more, or less time doing?

I'd rather be spending more time interacting with the family. Less time traveling during holidays or fighting about money with Blake.

Next week - Chapters 4-6!

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