Women in Finance (Books) Week: Filling your "purse."
16 June 2011
Welcome to today's installment of Women in Finance (Books) Week!
Today's book is yet another purple one, titled A Purse of Your Own: An Easy Guide to Financial Security, by Deborah Owens. As you can tell by the title (and the book's cover), this is yet another book that thinks layering some analogies on the problem will help women understand finance better. Owens's shtick is to get women to think of their entire financial picture as their "purse."
I don't own or carry a purse, so as you can imagine, this analogy was not as helpful to me as it might be to some.
But, once you get past the analogy stuff, and the author's introductory chapters about "wealthy habits" and "wealthy visions" (she's a big fan, as are most personal finance writers, of helping make yourself wealthy by believing you can BECOME wealthy), there's actually some interesting stuff here. For one thing, she does explain the "Rule of 72" (also, coincidentally, one of my father's favorite tools for understanding numbers): "This simple equation helps you to determine a rough estimate of the length of time it will take to double your money in an investment. Simply divide the number 72 by the annual interest rate or return on your investment." (p. 34.) Find something that pays 4% interest annually? It will take 18 years to double your money (72 divided by 4 equals 18). When authors share this rule, it always makes me feel a bit more secure in their knowledge.
This book also boasts one of the nicer explanations I've seen on bonds, and she doesn't do a bad job with stocks, either. I guess I can put up with a little nonsense about purses to get to some good (if still pretty basic) information.