Book Review: Living the Savvy Life

Last year I wrote about the stereotypes perpetuated by many personal finance books written for women, especially that women like to “shop till they drop.”

As I mentioned in the article, a Consumer Expenditure Survey showed that women and men spend the same amount of money, just on different items. Women spend more on clothing and men spend more on restaurants, gadgets, and transportation. Also, a Stanford University study found that incidents of compulsive shopping were almost the same among men and women (6% for women, 5.5% for men).

But where women are actually falling behind is retirement. Women earn less over their lifetimes and live longer, so I wondered why some of these personal finance books for women were focusing on a stereotype that women have a problem with overspending instead of on serious, documented issues like retirement readiness?

This isn't to say that there aren't any good money books for women out there. I fully admit that I haven't explored genre myself because the cutesy titles and pink cover art on some of the books was enough to put me off of it entirely. But after writing that GRS post, a couple of female authors contacted me to ask if I would be interested in reading their personal finance books. I figured, why not? I'm complaining about the genre, so let's explore it and see what's out there.

The Savvy Life Philosophy
The first book to arrive in my mailbox was Living the Savvy Life: The Savvy Woman's Guide to Smart Spending and Rich Living by Melissa Tosetti and Kevin Gibbons, who also run The Savvy Life online magazine.

Living the Savvy Life focuses on finding balance, not becoming a tightwad or cheapskate. The philosophy isn't anything new for most long time GRS readers: “Save money on the things that aren't as important to you so you can afford to spend money on the things that are important to you.” The writers break this down into the following six manageable savvy habits:

  1. Pay yourself first. Save 20% of your income (15% for retirement and 5% for emergency savings) and enjoy the rest.
  2. Track your spending. The authors use an Excel spreadsheet, but later go into detail about other ways to track spending.
  3. Pay all of your bills on payday. This ensures you'll have the money to pay your bills, eliminates late fees, and creates a routine that gives you more control over your finances. They even recommend filling up your car with gas and purchasing your groceries as close to payday as possible.
  4. Set financial goals. What big-ticket items are in your future? Research the actual cost, create a visual reminder, and open a savings account dedicated to your goal. Set a realistic date for achieving it.
  5. Know when to invest and when to bargain shop. Before you buy something, consider what you need it for and how long it will last.
  6. Spend money on the things you truly want. Sometimes it can be difficult to distinguish between what you want and what advertisements tell you you should want. As you approach the checkout counter, no matter what type of store you're in, take a look at the items in your hand or in your cart and ask yourself if they are things you intended to purchase before you came in the store and whether you really want them.

The next chapter, titled “You Can Afford It”, was one of my favorite parts of the book. Tosetti and Gibbons write:

“Stop saying you ‘can't afford it.' The fact is that you can. If you made more money, you could. If you didn't have a car payment, you could. If your mortgage was lower, you could. There may be caveats, but you can afford anything! Being able to afford what you want is about choices. Whether that choice involves doing something to make more money or lowering your cost of living, you chose to work in a career earning your current salary. You chose to buy the car you drive. You chose to live in your current home. The point is that you are in charge of your money. Money in and money out—you make the decisions.

The authors go on to give several case studies of people who improved their salary, increased their income in other ways, focused their spending, and changed their attitudes about money.

In the next several chapters they break down spending categories—home, entertainment, wardrobe, beauty, food—to help you decide how important they are in your life (if at all) and offer money-saving ideas. The last eight chapters are dedicated to more personal finance information, such as organizing your finances, ways to pay down debt, an explanation of compound interest, how to use credit responsibly, and other financial rules of thumb. There also is an exercise to help you determine your ultimate goals in life, create a plan to reach them, as well as tips to stay motivated during your journey.

Recommended, with reservations
All in all, I like this book. It presents personal finance in terms of lifestyle decisions, which makes it easier to understand and more practical. Several of the examples from the authors' own lives sounded familiar to my own financial journey. For example, they write that their trip to Disney World was a powerful lesson on how they could focus their spending to do the things that were really important to them. For me, my trip to Italy was what made me think hard about how I was spending my money—I'd been bitten by the travel bug.

This book is perfect for the woman who is just starting to show an interest in her finances, but might be nervous that being financially savvy means being a miser. Even those who have read a personal finance book or two are likely to pick up new ideas. For example, one of my favorite tips was to create a dedicated area in your home for managing your money and to make the space as inviting as possible. It's the difference between two scenarios:

  1. Getting frustrated as you try to hunt down bills, receipts, checks, postage, and envelopes to hurriedly transfer money or get checks in the mail at a crowded kitchen table, or
  2. Sitting down at a desk with all of those things in their place, a framed photo of your last skiing trip (because you're saving up for the next one), and a cup of tea.

Too often, my money management “space” is more like the former than the latter.

My one gripe with The Savvy Life is that I wish the authors had placed more emphasis on retirement issues unique to women. While they do cover retirement, I would have liked for them to drive home the importance of it even more. When I learned about the obstacles that women face when it comes to retirement savings, it was eye-opening—almost scary. I think it's easy for that message to get lost among the examples of more exciting goals, such as houses, cars, travel, etc. Retirement sounds downright boring in comparison.

Nevertheless, The Savvy Life packs in the essential information along with smart tips, and I liked the friendly and conversational tone. I wish I could have read it years ago—like maybe the day I graduated from high school.

More about...Books

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
30 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Cassy
Cassy
9 years ago

Great post. I just started paying attention to the financial side of my life. I hope this book gives me some guidance. Hope to see more posts like this!!!

Danielle
Danielle
9 years ago

Especially given your first paragraph, I find the cover on this book offensive. What is the woman doing? SHOPPING! Just once I’d like to see a woman at a conference table meeting with a banker/financial adviser, etc. And the adviser looking respectful!

Eugene
Eugene
9 years ago

The idea of what you can and can’t afford is very similar to the one Rich Dad advises: “The secret to getting beyond scarcity is to start beyond it. Feel a sense of abundance right now by living your life as though you were already finically free. Saying ‘I can’t afford it’ closes your mind but asking ‘How can I afford it?’ opens it up. Make the choice to be rich every day. Stop looking at the world through eyes of scarcity. Instead, open your mind to the riches all around you!” – Extract from Wealth 2.0 J.D.’s note: Eugene,… Read more »

April
April
9 years ago

@Danielle–I understand what you’re saying. Still, this one didn’t bother me as much as the images I’ve seen of women with several shopping bags and boxes of shoes.

But then, she looks like she just came from the farmers market, and I LOVE the farmers market, so that’s probably my own bias. 🙂

shash
shash
9 years ago

Not only is she coming from the market– she’s in Italy! (check the street) 🙂

Seriously though, thank you. Nice review.

April
April
9 years ago

@Shash–You are SO right. No wonder I liked the cover–it’s depicting my dream! 🙂

Kelley
Kelley
9 years ago

What are some of the unique issues women face in retirement? I’m kind of curious because I can’t think of that many. Of course, a longer life could mean the need for more money in the later years. Wouldn’t having a smaller income correlate with needing less money in retirement because one would already be used to living on less. But other than that how is a woman’s retirement fundamentally different from a man’s? Actually my husband plans on spending way more money in retirement than I do. We’ve already talked about it and planned for it (he enjoys golf… Read more »

getagrip
getagrip
9 years ago

I think the quote about affording things wasn’t given as much explaination as it deserves. A lot of people are in debt because they’ve listened to the advice of “you can afford it” without tagging on the lines “if you sacrifice or adjust X”. So that car payment is only $400 a month, and you can get the new PC laptop for only $60 a month, and that gym membership is only… and before you know it all the things “you can afford” are eating you alive. While I appreciate that the point is about choice, that isn’t what the… Read more »

Bethany
Bethany
9 years ago

I guess I’m not sure why women need a special financial book. Oh, I see — this one is makes money “easier to understand”. Are the “regular” financial books too complicated for my ladymind?

HollyP
HollyP
9 years ago

I always question the 15%. I have saved 15% a year for ages, and it still doesn’t seem like enough. @Kelley, women in general face myriad challenges. We are typically paid less, are less likely to negotiate for better starting salaries and raises (totalling $1 million over a work life), work in lower-paying fields. Many women take time off to raise children, and/or work part time. Women are more likely to be single parents, and that comes with both costs and limited income in some cases. All of this results in less in retirement savings and social security incomes. When… Read more »

Pamela
Pamela
9 years ago

Any book geared toward personal finance for woman should include information on salary negotiations. It’s something I never thought about until reading it on GRS, but it’s true that accepting a lower salary will affect your financial life for years to come. It seems that fewer women negotiate their salaries then men and yet we read very little about it.

Naomi
Naomi
9 years ago

Why do we need personal finance books “for women”? Is it because women earn less and live longer? Sounds like the book fell short on this message.

Also, I would argue that 15% for retirement is not enough.

PigPennies
PigPennies
9 years ago

I agree that the “you can afford it” phrase always makes me cringe. I picture a salesman right in front of me, and wish I could take back some of my decisions based on that thinking. But I do think there’s some validity to the point made by Rich Dad, Poor Dad in that saying you can’t afford something closes the discussion, but asking yourself how you can afford it opens you up to thoughts and ideas. The problem comes when people ask that question and answer it with a high interest loan! But if you examine areas of your… Read more »

Laura in Cancun
Laura in Cancun
9 years ago

Regarding the comments in #3 (Eugene and JD), I’m not sure of the entire context from Kiyosaki’s quote, but I really like the idea. It could easily be interpreted for the reader to go out and buy things they can’t afford, which is dangerous, but I interpreted it differently. I’ve noticed that the months my husband and I have the most fun and stop worrying about money (going on mini-vacations, day trips, dates, out with friends, etc) are also the months that we spend the least. I’m not sure what the correlation is yet… maybe we’re more satisfied with life,… Read more »

Jennifer B
Jennifer B
9 years ago

Holly P – I’m not going to get this phrased right, so I apologize in advance, but it was my understanding that social security was a benefit given to individuals, not family units. So each individual earns their social security benefits by their work history over the course of their lives. Individuals also have the option to get a benefit of 1/2 of their spouses benefit if that results in a higher benefit for themselves. When their spouse dies, that amount is jumped up to 100% of their spouses benefit. So yes, when a husband dies, the wife “loses” 1/3… Read more »

Angela
Angela
9 years ago

Sierra, you mentioned that “When I learned about the obstacles that women face when it comes to retirement savings, it was eye-opening–almost scary.” Can you point us to an article about these issues (or maybe write one)? Thanks.

T
T
9 years ago

It sounded hokey at first, but I really liked Smart Women Finish Rich by David Bach, which I’m pretty sure JD has reviewed. I thought it would read kind of condescending and out of touch but I was pleasantly surprised by his insight into the kinds of financial issues he actually sees women (his clients) facing all the time. He talks about both married and single women, women with and without children, with and without their own careers if partnered, etc. And when he does talk about overspending, he is clear that that’s a road he’s had to hoe as… Read more »

retirebyforty
retirebyforty
9 years ago

Sounds like a book the Mrs. would enjoy. Let me see if the library has this.

Jordan
Jordan
9 years ago

I can appreciate the “You can afford it” mentality, but understand the risk it poses to some people who are looking for an excuse to spend. My in-laws and my parents very frequently used the words “We can’t afford that.” to my wife and I growing up, so we interpreted that we were poor. I think a better line would be, “We can afford that, but you won’t be able to go to Cornell.” ala The Millionaire Next Door. It’s all about choice: choosing to buy a new LCD TV or paying down debt, etc.

Meghan
Meghan
9 years ago

@Kelley and @HollyP: To add to that, women are more likely to take time off or help out with the care of ageing parents.

The Globe and Mail, one of Canada’s national newspapers did a series awhile ago about women in retirement, which I found it very useful for understanding some of the main issues and dilemmas women face (and not just Canadian-specific info): http://www.theglobeandmail.com/globe-investor/personal-finance/retirement-rrsps/women-and-retirement/

Pat S.
Pat S.
9 years ago

I think there’s some real value here. I used to ask myself “can I afford it”, and I wound up $62K in debt, because I was looking at whether I could afford a monthly payment. This is the mindset that leads us all down the primrose path to debt and paycheck to paycheck living. Now I ask myself “do I need it, and can I pay cash for it”, and in the process have paid off $45K in debt in 3 years. The only debt I have left is student loan debt, with a 3% consolidated interest rate, that I’m… Read more »

Kate
Kate
9 years ago

April, thank you for this great article! This is the very thing we talk about in our monthly Women’s Saving Club meetings. Why? women are falling behind in savings and retirement and how we can work together and support each other in reaching our goals.

Thank you again for highlighting these differences. You’re welcome to follow our discussions on money at http://www.WomensSavingClub.com

DreamChaser57
DreamChaser57
9 years ago

Enjoyed the review. I think I will add this to my reading list. Not to be contrary, but I don’t think a valid reason for disliking a book is that it did not explore every relevant nuance or tangent you deem important. That’s an impossible feat. I’ve noticed a tendency for book reviewers to purposefully use language that hedges as if saying a book is good automatically infers that it is the definitive informational resource in a particular area. I personally love the cover because the woman is casually dressed in beautiful serene surroundings -I get the sense that she… Read more »

chacha1
chacha1
9 years ago

I too think this particular book cover was well designed. In combination with the title, the cover photo says “savvy = walking to the market in your quaint old world village of choice with not a care in the world.” Sounds like a good entry-level personal finance title to me, and IMO a book directed to setting yourself up for a financially successful life has the correct focus, vs a book directed to “retirement issues” faced by women. If you set yourself up thoughtfully, retirement problems are just a heckuva lot less likely to arise. What I would like to… Read more »

Ginger
Ginger
9 years ago

Thanks JD, I’ll check it out in the library. I, also, would like to see more women’s financial books on retirement. Maybe I’ll have to write one when I am older.

Snowballer
Snowballer
9 years ago

Okay, this was good and all but I have to ask. Why is there a need for books of this type specifically addressed to either gender? Indeed why is there a gender segregated personal finance market at all? This has always baffled me. Out of curiousity I’ve actually read some chapters from a few by authors I shall not name, and other than the anecdotes being selected for a different audience, all the advice in them was equally applicable to me and last time I checked I had wedding tackle and a Y chromosome. I have in fact even been… Read more »

Jan
Jan
9 years ago

I started reading Jane Byant Quinn in the late ’70s. She “taught” me everything I needed. I will be rereading her book, again, and working the principles, again. This author sounds like she is on a good track. I get bored of blogs and books that target me as a shopper. As I watch the next generation of women grow- there seem to be as many women out there who depend on their man to be the primary income (which my man was and still is) without the smarts to save a part of that income for themselves. My daughter… Read more »

Project Management Tools That Work (Bruce)
Project Management Tools That Work (Bruce)
9 years ago

When I mention to my school age daughters that they eventually need to save and invest for “retirement” they just kind of roll their eyes.

When I tell them they should save and invest for “financial independence” so they can do more of what they want to do later in life, that makes a lot of sense to them (“Of course we will! Why wouldn’t we?”).

El Nerdo
El Nerdo
9 years ago

The gender thing has to do with two things it seems: a) Real demographic differences, like the “longer life, less retirement money” that was mentioned. Not sure there are enough differences today to merit *a whole book* the way “Our Bodies, Ourselves” had to be written, for example; but these days there’s a book for everything. b) Marketing. That’s what the cover is for–to target a specific population. By April’s summary, this is a repackaging of the usual fundamentals, but it comes in a “female-friendly” Eat-Pray-Love-style wrapper. A marketing gimmick? Sure, but whatever gets people to consider good financial habits,… Read more »

Michael
Michael
9 years ago

A few things – I think it is slightly disingenuous to make the statement that “women face a much larger savings challenge than men because they typically earn less”. First of all, Social Security replaces more of a low-income worker’s income in retirement than it does high income earners, so low income earners have to save less overall, as a percentage, to get to the same level of income replacement. Second of all, one of the largest struggles in saving for retirement is continual salary increases – raises act as the power of compounding, except against you. Low income workers… Read more »

shares