Book review: Debt is Slavery

One of my goals for the next two years is to write a book about personal finance. I want it to be a practical volume filled with great tips, while also exploring the personal side of money issues. The real trick is that I want it to be a short book — no quizzes, no jargon, no padding — and that's not something that appeals to most publishers. Unfortunately (or perhaps fortunately), Michael Mihalik has already written a book similar to the one I have in mind!

The body of Debt is Slavery (and 9 Other Things I Wish My Dad Had Taught Me About Money) is just 88 pages packed with sensible advice about money. Like me, Mihalik made some dumb financial choices when he was young, and he spent years struggling to recover from his mistakes. Debt is Slavery is the distillation of all that he has learned about personal finance. If you've been reading Get Rich Slowly for a while, Mihalik's lessons won't be new, but he does an excellent job of presenting each point.

Related >> How Do You Budget for Experiences After Debt?

Here are the 10lessons the author wishes he had learned when he was younger:

  1. Debt is slavery. Mihalik discusses secured debt and unsecured debt, credit cards, mortgages, and more. He explains how working to pay off debt is little more than slavery: you're working because you have to.
  2. Money is time. Those who have read Your Money or Your Life will be familiar with this concept, the trade-off between work and dollars. Whenever you buy something, you're not just spending money on it — you're literally spending time. Money is a representation of hours worked, and when you buy frivolous things, you're squandering hours of your life.
  3. Possessions are a prison. This is a concept that I've only recently begun to understand. Kris and I have been on a de-cluttering kick lately. Slowly, and in stages, we've been purging much of what we own. This was painful at first, but has become more liberating with time. Mihalik has a few simple rules for controlling the stuff in your life — they're excellent.
  4. Don't let advertising brainwash you. I've written before about the insidious power of marketing. (And I have another entry on this subject coming soon.) Mihalik decries the Great Marketing Machine and its drive to hook us on status and fashion. Related >> Beware the Insidious Power of Marketing
  5. Money buys freedom. Money cannot buy happiness, but it can buy freedom. Money can give you more options. This concept is closely tied to “possessions are a prison.”
  6. Don't sell your soul for a salary. Money should not be your primary motive for choosing a career. Consider job fulfillment, educational opportunities, and personal values. Try to find work you love.
  7. Own. Mihalik admits this advice might seem to contradict his previous notion that possessions are a prison. “Income-consuming assets can imprison us, he writes (echoing the good part of Robert Kiyosaki's advice). “Income-producing assets set us free.” Don't buy Stuff — instead, invest your money in things like mutual funds and real estate, things that make money and not consume it.
  8. Spend less than you earn. What can I say about this? It's the fundamental law of wealth. Mihalik explains how to meet this objective by controlling your expenses. Related >> The Most Important Money Tip
  9. Save 50% of your salary. This is the most ambitious advice in the book, but I like it. Mihalik writes, “Have you ever asked yourself how people who immigrate to the United States can come here, get a low-paying job, and open their own business five years later? How can they do that, making around minimum wage, when you can't, making more than minimum wage? They save. They save 50 percent or more of their salary. They don't go into debt, they work hard and make other sacrifices, so they can buy their own business and control their financial destinies.”
  10. Control your money. In the book's final chapter, Mihalik lays down an approach to making all of these goals workable. He explains how to eliminate debt, minimize expenses, and create a financial plan.

Finally, Mihalik admonishes his readers to start now!

Debt is Slavery is a great personal finance book, one of the best I've read. But I'm not the first personal finance blogger to have found it.

This book isn't meant for those who are already debt-free. It's meant for people who are in the early stages of their personal finance journey. If you're struggling to make ends meet, if you're living paycheck-to-paycheck, then this book is perfect. I also think it's a great choice for recent high school or college graduates.

More about...Books, Debt

Become A Money Boss And Join 15,000 Others

Subscribe to the GRS Insider (FREE) and we’ll give you a copy of the Money Boss Manifesto (also FREE)

Yes! Sign up and get your free gift
Become A Money Boss And Join 15,000 Others
guest
32 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
joshuat
joshuat
12 years ago

I’ve thought about writing a book on personal finance as well, but I figure Dave Ramsey’s books, and probably this one as well, already say everything I would want to write about.

Eric
Eric
12 years ago

First off, I appreciate your reviews. I’m reading freakanomics now and wasn’t planning on doing so until I saw your review of it.

Second, I think anyone could write a good personal finance book, I think at this point, if you don’t have the street cred, you would have to niche your book to an area of expertise. Just my two cents.

jason
jason
12 years ago

I read this book a few months ago and really enjoyed it. The one thing with the book that stuck with me is how it suggests you create your budget. I highly recommend this one for someone in the early stages of getting out of debt.

icup
icup
12 years ago

you know, a thought just struck me when I read the subtitle of that book “(and 9 Other Things I Wish My Dad Had Taught Me About Money)”. Could the reason that our fathers did not teach us that much about debt be because nobody from that generation could possibly anticipate the sheer level of abuse the credit card companies allow us to get away with? My dad has always gotten a loan to buy something like a new car or a new snow blower, and I assume that is the only way he knows how to buy such a… Read more »

Wesley
Wesley
12 years ago

Nice…I like the book’s title. It definitely drives home the point. I think the author has an extremely valid point about immigrants, and that illustrates his point quite well.

Thanks for pointing this book out. I hadn’t heard of it until this review.

OneYearGoal.com - $100,000 in one year
OneYearGoal.com - $100,000 in one year
12 years ago

Great review of what looks like a great book. Debt can be prison, and some assets are really liabilities in disguise (ask anyone who owns a foreign car)

cynner
cynner
12 years ago

Sounds like a good book. I have an issue though with the “see how the immigrants do it”. In a lot of immigrant communities there are alternative methods of accessing capital to start businesses or finance real estate that are not typical or available to other members in American society.

Aleks
Aleks
12 years ago

I don’t like the title, I think it’s stupid and insulting. It’s a comment on how easy we have it and how little real suffering we endure that a title this insipid receives so little criticism. Debt is not slavery. Can your credit card provider beat, rape, or even kill you with no risk of consequences? Do they even force you to do something that you wouldn’t be doing anyway? Working for a living is what everyone except the ruling class has had to do since before we had thumbs, because the alternative is not living. If you want to… Read more »

rstlne
rstlne
12 years ago

Is the 50% that you save before or after taxes? I find that after taking away Federal and State taxes, Social Security, Medicare, and state unemployment and disability insurance, 50% is all I have left!

AP
AP
12 years ago

To Aleks’ point, perhaps a better title would have been “Debt is indentured servitude” which is how I often think of it, but that would probably sell fewer books. I do however feel that credit card companies display predatory and exploitative behavior, with no risk of consequences. They can arbitrarily increase your APR, double- and triple-charge in the form of late fees and over-limit fees (now that the late fee has pushed you over your limit), extend credit and high credit limits to individuals who have no way of ever paying it back (yes the individual does bear responsibility too… Read more »

Travis Pulley
Travis Pulley
12 years ago

I’ve just recently reduced a lot of possessions after finally getting some time to give it the proper attention. I’m now working on getting the least accessed items that I can’t part with organized such that I can pack them away and refer to inventory data to locate an item when I need it.

I also cut my expenses way down without compromising on things like quality food and regular comforts.

All in preparation to take on debt as per lesson #7 😉

Karen
Karen
12 years ago

Wow, Aleks, I didn’t get the same impression from the title of the book. I do understand the need to work, but I think that working to sustain an unfulfilling lifestyle is insanity.

Capt
Capt
12 years ago

Aleks: “Debt is not slavery. Can your credit card provider beat, rape, or even kill you with no risk of consequences? Do they even force you to do something that you wouldn’t be doing anyway?” Since the banks that own the credit card companies in question also own the federal reserve bank, through which they manipulate the federal government, i would have to say yes. and i really wouldn’t pay taxes just because i chose to work, while non-workers do not pay these taxes, if it wasnt for the fact that the IRS would come and beat, rape, maim, ravage… Read more »

Dave
Dave
12 years ago

There were several comments about current attitudes toward debt, but I think this has been going on for some time, maybe just not as prevalent. When I first got married, back in the dark ages, my wife and I had to learn to survive on my very small salary. Her family was not all that well off, but had a habit of going all out each Christmas and buying expensive gifts for everyone. They would max their credit cards, then spend the rest of the year paying them off, only to restart the cycle again. We had a lot of… Read more »

Minimum Wage
Minimum Wage
12 years ago

Does the author explain how to spend less than you earn if you earn minimum weage and have student loan debt? That alone would be worthy of a book.

Angie Hartford
Angie Hartford
12 years ago

This sounds like a wonderful book. Issues about how to phrase concepts aside, money can buy freedom. I’m in favor of anything that helps people achieve financial security. Including this blog.

Aleks
Aleks
12 years ago

“I’ve just recently reduced a lot of possessions after finally getting some time to give it the proper attention. I’m now working on getting the least accessed items that I can’t part with organized such that I can pack them away and refer to inventory data to locate an item when I need it.” Heh, I’ve been doing some decluttering this summer as well, but it’s actually made my house more cluttered, in the short term. I’ve got stacks of things on my table waiting to be sold on eBay, I’ve got bags of old clothes waiting for Big Brothers… Read more »

Kevin Baker
Kevin Baker
12 years ago

apparently aleks needs to go use a dictionary and look up the word slave. Yes the most obvious definition would be a physical human slave but it has more than one meaning depending on context.

BigJeff
BigJeff
12 years ago

To Aleks: It’s called hyperbole. Look it up. Also, just because the slavery caused by is less “in your face”, less physical, and certainly less horrific, does not mean it isn’t trapping you and preventing you from achieving the maximum freedom in your life. Think of it this way: if you weren’t a slave to debt, you would have the resources to help those trapped in the human trade get free. Granted, your help wouldn’t likely mean a whole lot on its own, but if everyone were responsible with their money real change could be made. Honestly, to me you… Read more »

db
db
12 years ago

Decluttering and simplifying possessions is wonderful — I’ve been chipping away at it for several years. It’s like an archeological dig, I peel back one layer of superfluous possessions at a time. I’m really getting close on this though, since I’m really having to work now to find something to let go of. Sure, there’s still stuff, but I’ve come a long way — and my trunk is currently stuffed full of items to be dropped off. I’ve been hitting the section of my closet where my “thin clothes” and a bunch of outdoor gear I never use remained. Oh… Read more »

Travis Roberts
Travis Roberts
12 years ago

Hey, great review and thank you for sharing this book! I linked to your blog in a post I made today!

Stop in sometime and keep sharing!

James
James
12 years ago

Hi J.D.,

Thanks for the note. Its seems like the book is good for people who are beginners. Do you have any recommendations for folks who are a little more advanced in their understanding of personal finance?

mbhunter
mbhunter
12 years ago

Ahh, a rare moment of eloquence from my blog. 😉 Thanks for the link!

Jailja
Jailja
12 years ago

Nice, very nice, thank you. See what happened to me after I read this article (http://www.seventimesseven.com/2007/08/08/debt-is-slavery/).

Special Ed
Special Ed
12 years ago

“When he reviewed the book last February, the Mighty Bargain Hunter wrote: “Debt is Slavery is the kind of how-to manual that should be handed out like tracts at an airport.” Amen.”

I browse through books quite often when at the airport. The book I see more and more often is “The Secret” I’ve rarely seen what I would call a good PF book.

Aleks
Aleks
12 years ago

“It’s called hyperbole. Look it up.” Actually it’s called marketability. Nobody would buy a book called “Debt is the Natural Consequence of Fiscal Irresponsibility.” Slavery is when your freedom is taken away from you. Debt is when you have too much freedom and not enough responsibility early in life, and then have to pay it back by being more responsible and having less freedom. A slave is someone who sees no benefit from the work they do. A debtor is someone who already took the benefit, and now has to do the work to pay back what they owe. As… Read more »

Mural
Mural
12 years ago

Loved the review! Very clear and inspiring and it made me want to read more!

Suggestion: why not start a partnership with Amazon, linking to the books you write reviews about? If people get inspired to spend some of their hard earned cash on books you suggest, I think it’s only fair that you get a commission. 🙂

dcturner
dcturner
12 years ago

Re: Save 50% of your salary.

If you currently have no savings but can live on 50% of your (net) salary, and make mediocre returns on future savings, it seems that you would be financially independent in just 15 years.

Larry
Larry
12 years ago

The title of your book is interesting. As a father of 4 sons it probably should read:

Things my father taught me but I refused to listen.

Tim
Tim
12 years ago

Hi, thanks for linking to my review of the book. I’ve been so inactive I just now noticed! 🙂 Thanks again.

Eric Monse
Eric Monse
12 years ago

Thanks for posting. I have to check out this book.

Aaron
Aaron
12 years ago

What a nightmare! My advice for college students? Work like hell to avoid debt…

A good example of a smart college student doing this can be found in this article at…http://www.eastbayexpress.com/2007-08-15/news/campus-cost-coping/

The site he uses is called Barefoot Student and can be found at…http://barefootstudent.com

shares