Inaccurate Knowledge Is Worse Than No Knowledge

I hate bad nonfiction books—by bad, I don’t specifically mean boring (though I’m not fond of boring books, either), but books that contain major inaccuracies. I also hate it when people condescend to women, especially when it comes to finance. Unfortunately, I encountered both inaccuracies and condescension in a book I read recently. I had to trash it on Goodreads, but I’m sure there are many of you out there who don’t follow my Goodreads review. (I don’t follow most of the blogger I read on Goodreads, so I certainly don’t blame you!) Therefore, I just had to post this review on here in all its ranty glory. Enjoy!

The Financial Diet: A Total Beginner's Guide to Getting Good with MoneyThe Financial Diet: A Total Beginner’s Guide to Getting Good with Money by Chelsea Fagan
My rating: 1 of 5 stars

If this book were simply useless to me, I could have given it two stars. I know it’s marketed towards young women who don’t know much about money. And that’s fine, because there are people who don’t know much and everyone’s got to start somewhere. I get that.

What made me give this book one star (i.e. the lowest rating allowed—I’d give it negative stars if I could!) was how some of the information was just plain wrong. Like criminally wrong. So wrong that if you followed it, other poor fellow unfortunate readers, you’d find yourself in deep trouble.

The first major error I’m going to talk about comes in chapter 5. Do not, do not, DO NOT ever buy a house with a down payment of less than 20%. One of the so-called “experts” “interviewed” (I use both those terms, experts and interviewed, loosely) says you can put 3.5% down for your house. NO. Do not ever do that. PMI (private mortgage insurance) will eat you alive. Your finances will be so messed up it isn’t even funny. I will note that other reviewers pointed this out, too, so it makes me feel a bit better that this mistake did not go unnoticed.

The next, and in some ways more egregious error (because you probably start investing before buying a house) occurs in chapter 2, the chapter about investing. This quote is so misguided that it’s obvious the author, Chelsea Fagan, has zero idea what she’s talking about:

Explore other low-risk investment options, such as mutual funds and index funds.

Continue reading “Inaccurate Knowledge Is Worse Than No Knowledge”

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