By Bruce Helmer
Reviewed by Jon Ford, CFP®
Money and the People You Love is extremely clear and well written. For the first hundred pages I was pulled along willingly by the great writing style and organization. The book is written for the amateur, not professional, planner; as such, I believe it should be held to a higher standard. The book claims to (1) explain the fundamentals of financial planning, (2) describe how to take a new look at readers' personal finances as they emerge from a time of extraordinary upheaval, and (3) make sense of one's finances in the context of our love for others.
In six parts the book does a first-class job discussing financial fundamentals. Part I begins with a spending plan and then moves on to saving, investing, paying taxes, sharing your wealth and planning for the future. Part II stresses the importance of spousal considerations with respect to money management, emergency plans, improving your life and retirement.
The subject of part III is money and children. It describes parents as protectors and providers, teachers, financiers, benefactors, and eventually grandparents to their children's children. Part IV discusses money in the context of one's parents, including caring for elderly parents, the use of wills and estate planning, and the personal consequences of inherited money. Part V is quite short (four pages) and limits a discussion of money and others to the use of charitable trusts. Part VI ends the book with a look at the financial pros who can help. It does this by pointing to the demise of stockbrokers and accountants in the financial planning arena, and the rise of financial planners because of an increased need by the public for comprehensive financial services.
What I like about this book is that the author shares how to sensitively bring money and conversations about money into everyday family discussions and raising children. I like how he debunks the myths of the unquestioned value of dollar-cost averaging and need to save in tax-deferred accounts. I like how he encourages readers to strive for physical health, be good to friends, and seek a financial planner who is independent of the product he or she sells. In the chapter "Teacher" in part III, the author lays out excellent ideas for parents about raising their children as responsible caretakers of wealth.
What I dislike about the book is that it devotes one-quarter of the investing section to annuities. It wouldn't have been so intrusive on an otherwise important book, except that the focus was reactionary and defensive rather than practical and innovative. I believe there is much more to investing as it relates to the people you love than to convince the reader that objections to the use of annuities are, in the author's word, "silly." At this point in the book, with some exceptions like the excellent "Teacher" chapter, the author switched from being an informed counselor to an insurance salesman. His appeals for independence and objectivity seem a bit moot when all financial problems from then on lead, at least in part, to an insurance product solution.
Those who sell insurance products, especially annuities, will find this book to be a great gift for clients. In addition to endorsing the high costs and surrender penalties of annuities, it does, in fact, present a sensitive approach to money as it relates to the people you love.
Jon Ford, CFP®, is president of CF Financial Planning Solutions Inc. in Cedar Falls, Iowa. He writes a weekly Financial Fundamentals column for the Cedar Falls Times.
Syren Book Company