Kimberly Palmer, an editor at U.S. News, recently published a personal finance book called Generation Earn. Although the book is geared toward young adults, I found that it spoke to my financial situation many times, even though I fall squarely in the middle age bracket (gray hair and all). So while I rarely write book reviews, this is one that is definitely worth sharing (I included it my list of the best personal finance books not long ago).
One of the first things that distinguishes Generation Earn from other personal finance books is that it questions conventional wisdom. For example, the first chapter is called “The Joy of Spending.” While many personal finance books talk a lot about the money we shouldn’t be spending, it’s refreshing to see an author recognize that money well spent can and should be a positive experience. Another chapter that takes a contrary view is “The Upside of Debt.” We’ll come back to that chapter in a minute.
The second thing that distinguishes General Earn from other money management books is that it’s not boring. So money finance books are about as exciting as watching paint dry. With Generation Earn, there are several factors that made it a joy to read. First, Kimberly is an excellent writer. I guess that should come as no surprise given that she is an editor at U.S. News & World Report. Second, she uses stories of real people making real financial choices throughout the book. These stories make for an interesting read. And finally, the book’s content does not fit easily into a cookie-cutter formula. For example, the book covers green spending and charitable giving, reflecting the reality that our money isn’t just about us.
With that overview, I want to look in more detail at a few of the chapters in the book.
Good Debt vs. Bad Debt
The chapter I found the most interesting was “The Upside of Debt.” In summary, Kimberly argues that debt can be a very powerful and beneficial tool, if used correctly. As she puts it, “whether taking [on debt] is a good or bad idea depends on the kind, how expensive it is, and how it fits in with the rest of your financial life.” I couldn’t agree more.
We’ve used debt to buy our home, of course. But I also used debt to get through law school. And we used credit cards with 0% balance transfer offers to get out of credit card debt faster and for less money. I’ve also used debt to finance investments in real estate.
On the other hand, we don’t use debt to finance a life style we can’t otherwise afford. We don’t use debt for vacations, cars, furniture, clothes or other monthly expenses. All of that is to say that the chapter on debt provides a balanced approach that every young adult just starting out should understand and apply to their finances.
Starting a Side Business
Generation Earn also includes a section on starting your own side business. Of particular interest was a section on bloggers who have made extra money building personal finance and other websites. This is advice I wish I had taken years ago. On the other hand, I’m glad I began my online adventure when I did (May 2007). It really has been a life-changing experience. While Generation Earn is not focused on starting side businesses, it does provide some ideas and motivation.
The key is to realize just how powerful side income can be. Imagine what even an extra few hundred dollars a month could mean to your budget. And a side income in the thousands (and yes, even tens of thousands) is possible.
Generation Earn also includes a chapter on how to help protect our environment with the daily purchases we all make. From using fewer products to buying CFL bulbs, the chapter is packed with great ways to lesson your carbon footprint. The great thing about green spending is that you not only help protect the environment, but you also save money at the same time. That’s one of the reasons I started Energy Saving Gadgets.
The chapter also includes a section on green investing. I have to confess that I’ve never considered a company’s impact on our environment when making investing decisions. But it’s certainly worth considering.
As you can tell, Generation Earn covers a lot of financial topics. And its breadth makes for a very interesting read. I highly recommend the book.