It's not often that I do a book review. Though it seems that at least once a month some author's marketing team sends me a new book, I almost never get around to them. The biggest reason is that I'm an extremely slow reader and most books would take me 8 hours to read. If I then want to write about it, it's going to be another 2-3 hours of gather notes, thoughts, and coming up with something interesting read. (And as many people have noted time and again on this site, I don't spend the time to proofread).
When I found myself needing to see the doctor last week, I looked around for a book to take with me and David Newby's Why Didn't Anyone Teach Me This? seemed like a perfect fit (that link may not be the actual book, but it's mostly the same title from the same author, not sure why he added an extra word). It was 120 pages of big type - most people could probably read it in about an hour (or two hours if you are a slow reader like me).
I haven't had a book bring out such strong emotions from me in some time (again this might be due to the relatively few books I read). I felt the book sent conflicting messages. The conflicts start at the cover. I don't know if you can see the yellow star in the image, but it promises $3,197 in free bonuses with the purchase of the book. On the back cover it's the author leaning on his Lamborghini. The sales pitch is strong from the outset. However the rest of the cover is pretty friendly, some books and an apply that apply to the teaching metaphor in the title.
I think the best way to go through this book is to break it down in the good and the bad:
- Length of Book - I mentioned this on the outset, but it's nice to pick up a nice short book and not have to invest a lot of time in it.
- Some Sound Financial Advice - (More on this later.)
- Charity - He mentions his favorite charity in the book and recommends giving to charity.
- Animals - No animals appear to have been harmed by the making of the book... unless you talk about tearing down the forest where they live for the paper. So umm, let's scratch this one from the list.
- Length of Book - While I like something short, in the end you aren't paying for a lot of original content or concepts. It's really only 100 pages if you take out the blank pages between chapters. Each page a big quote box on it from the reading (like you would find in a newspaper). Between the quote box and the large font, I counted one page at 130 words. For reference the opening paragraph to this post is 100 words. At the end of each chapter is a review and there's a three page spin on why he likes his charity. If you start trimming the fat, you could probably fit it in 30-40 pages of regular book type, and not change the content at all. If you wanted to edit the message a little, I could probably sum up the whole thing in one 500 word blog post. I may just try that in the future.
- Sales Pitch - There are a lot of scummy sales stuff in this book. The cover that mentions $3,197 in bonuses includes $3,000 in "coupons" for his "system" and seminars. Every time you think you are going to read something thought-provoking, you are left hanging as he tells you to look it up in another book or online class.
- Some Not-So-Sound Financial Advice - (More on this later.)
Good Financial tips in the book:
- Newby breaks down why many people won't be able to retire (people don't save enough).
- He writes about having a dream and identifying that dream (I replace "dream" with "goals" in my head, but mostly the same).
- Newby correctly states that few people have job security nowadays. His story about being a top performer at a company and getting laid off when the company got bought mirrors my own story. In fact it's the idea of wanting to "layoff-proof" myself that made me start Lazy Man and Money to explore ideas on how to become financially independent.
- He has solid tip about coming up with an idea and licensing it out. He's quick to say, "Don't by factories employ people and all that. Just sell the license to someone else who will do the manufacturing and distribution for you. If you have an invention, this seems like a fine way to go.
- Newby wisely points out that people who make more money often have lifestyle inflation and spend more money. This is why many people who get raises often are left back where they started - with no savings. He calls this "Perkin's Law" and defines it as "Expenses always rise to meet income." I wrote about this phenomenon before, but it's Parkinson's Law. I could find no record of Perkin's Law.
- He advocates saving, paying yourself first, paying down debt, even funding a "survival account" (i.e. emergency fund).
- Newby explains the rule of 72.
- He likes Roth IRAs (see below for more on this).
Bad Financial tips in the book:
- Newby goes into several pages of convincing you that you have to have change your thinking by developing a daily affirmation that invokes memories of Stuart Smalley. Of course if you think the daily affirmations are ridiculous, he might say that you are just not open-minded enough. I would use one his own arguments against him, "Do you think Donald Trump wakes up each day and tells himself these affirmations?"
- Newby recounts the story of his friend Bob who had to wait until his credit approved to buy properties. Meanwhile, he says that he bought 5 properties with "damaged credit." Remember Casey Serin? Also, it's worth noting David Newby doesn't tell you how he got the money to buy 5 properties and/or how heavily leveraged he was. Without more information, I'm inclined to believe he got lucky while Casey Serin was unlucky. This is hardly good financial information to pass on.
- He claims that if Oprah, Larry Ellison, or Bill Gates went broke tomorrow, they wouldn't stay broke because wealth attracts them and they have confidence. No... the reason why they wouldn't grow broke is that they are famous, have great brand awareness, and exceptional contacts to other rich/famous people. I've heard Oprah speak and she will be the first to tell you she didn't attract wealth at age 20. She didn't even try to.
- He talks about "Leverage Masters", a term for people who utilize other people's assets to make money for themselves. He doesn't explain how to become a leverage master... even in the section called "How to Become a Leverage Master." Instead he says to learn the ways of Leverage Masters and act on them.Wait, learn and act are the keys to being successful at almost anything. What do I need to learn, well that's the thing Newby doesn't tell you.
- He explains that there's a way to protect your assets so that you won't have to pay someone if they win a law suit against you... and they'd still have to pay taxes on the winnings. This is one of the most irresponsible things I've read in any book. I don't care if it's technically legal, it's immoral. By the way, we don't know if it's technically legal since he doesn't explain how it's possible in this book... you have to go sign up for one of his special reports.
- He says, "401Ks and IRAs are the WORST way to invest your money." Newby says that those instruments are tax-deferred which is not as good as the tax-FREE way to invest with Roth IRAs. He's clearly not the financial wiz as the difference between a 401K and a Roth IRA is when you pay the taxes. With a 401K, you get to invest a lot more at the beginning and watch it compound faster because it's pre-tax money. With Roth IRAs, you pay the taxes up-front which results in it not compounding as fast. In the end, as long as the tax rate is the same when you pay them, the investments come out to be the same.
- Newby advocates investing in Universal Indexed Life Insurance. This is taken directly from Doug Andrew's Missed Fortune
. I read another Doug Andrew book that mentioned this method, but it was complex and involved a lot of fees. It may be right for some people, but I'd need to look into it more. Oh, and Newby mispells Andrew's name as Andrews... I bet Doug's not all that happy.
- The Biggie - He advocated investing in real-estate backed investments. He doesn't tell you what it is, except that it's average a 30% gain over the last 29 years. Yes it's hard to imagine any investment doing that over 29 years, but now that I think about it real estate has done well. Of course we've seen how it's dropping now. Wages aren't growing fast enough to support further growth in real estate, so this investment is ready for a collapse if it hasn't already. If you want to know more about this investment, you need to buy his "system" or seminars - which will likely set you back thousands (especially because he's giving out $1000 coupons).
So you can see that there is some definitely good financial advice in here. It just feels to me that he's using that as a way to earn trust to get you to spend the big bucks on his programs. Upon 30 seconds of finishing the book, I tried to think of a proper way to sum it up. Many people familiar with the story of Superman are also familiar with Bizarro, a character like Superman with his speed and strength, but also the opposite of him in many ways (he lived on cube-shaped earth and his speech is often oddly arranged "backwards" sentences). I think David Newby is Bizarro Lazy Man (or depending on your point of view, I'm Bizarro David Newby).
In the end, it's probably pretty obvious why Newby sells the book at TheCrapBook.com. I haven't seen a domain so aptly named in a long time.
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