Review: The 10 Commandments of Money

I’ve been a big fan of Liz Weston’s writing, particularly her columns over at MSN Money. I’ve also communicated with her many times in the past. So, when I saw that she had a new book out, it was an immediate addition to my reading list.

This book, The 10 Commandments of Money, features a subtitle, Survive and Thrive in the New Economy, that left me wondering about the purpose of the book. It seemed a bit out of Weston’s wheelhouse to write a “buy gold and land” type of book – a particular subtype of personal finance I avoid.

Rather, this book is more about positioning yourself for success down the road as the economy rebounds from the downturn and opportunities come your way. That’s a solid perspective for anyone who is planning for a brighter future to have.

Unsurprisingly for a book of this nature, it’s divided into a series of chapters that each focus on one of the ten commandments, so let’s walk through them.

I: Create a Budget That Works in the Real World
What does Weston mean by a “budget that works in the real world”? Weston subscribes to the 50-30-20 model of budgeting. 50% of your take-home income should be spent on stuff you need, such as your bills. If your actual bills take up less than 50%, good job, but many people are over that 50% mark. If you’re over the 50% mark, the remainder comes out of the 30% slice – the money spent on stuff you want, such as entertainment and the like. The other 20% goes to savings of various kinds, like an emergency fund or retirement, depending on your needs. (more)