I was recently given a copy of the book,The Psychology of Wealth: Understand Your Relationship with Money and Achieve Prosperity. Since I do believe psychology plays a major part in personal finance I chose to review this book. If you have been reading personal finance blogs for a while you know that the basics of personal finance are pretty simple. Knowing the basics of personal finance and actually applying the basics are two different things though. That is where the the psychology comes in.
Since this book is written by a psychologist I figured it would provide a good framework of the psychology needed to attain wealth. It does provide what the author considers to be the four qualities that wealthy people possess. They are self-esteem,responsibility,determination, and achievement. I agree that those qualities are good ones to have to achieve wealth but I don’t feel that the author gives much information to help you develop those qualities. He does provide lots of case studies that are interesting but not always helpful.
The author loses me when he talks about the power of positive thinking. I agree that positive thinking is a positive attribute and it can help you achieve success. But I don’t believe it has the magical power that the author gives to it. You still have to go out and do stuff and not just think about it. The author gives an example of a woman who was down to her last $5 and used it to buy a raffle ticket. She ended up winning a hot-air balloon ride which was something she always wanted. The author stated that she had a healthy sense of self-esteem and trusted her ability to create prosperity for herself. I don’t think that had anything to do with her winning. I think it was just luck. Using your last $5 to buy a raffle ticket is not a wise choice. It worked out okay for her but I guess all the other people who bought raffle tickets weren’t thinking positive. There are several instances of similar what I consider to be bad advice in the book.
I like the idea of using psychology to help achieve success and I have reviewed other books that I though did a good job of observing how psychology affects wealth. This book however, contains too much magical thinking and other bad advice for me to be able to recommend it.