This online version of The Money Cookbook is an excerpt from the full book which can be purchased here. What you discover here is all about money! It's about giving people a recipe to use their money the right way and have a successful life. The key ingredient to this part of their lives is money.


For example, when I’m having a dinner party and I’m cooking in the kitchen with my wife, we are always asking, “Well, what are we going to do?”

Planning is the fun part; it’s understanding the person you are, the meal you want to prepare, the finance you want to have, the life you want to have.

This planning process can be broken down into three different systems—or three different tactics:

• Have the right vision.
• Have the right plan.
• Be consistent and persistent.

Quite naturally, you spend a lot of time on where you are now. How important is it for you to know exactly where you are when you're starting to cook?

As I said before, having the right vision is often the hardest part for most people because we're so busy in our daily lives. We actually don't take the time to sit and wonder what things we want to do. However, it’s very important that you assume you've already got the money to do these things. It's a lot more fun too, because you can visualise so much easier if you think, "I've already got the money. I know I'm going to go and do this. I know I'm going to have a new car. I'm going to buy the house. I'm going to do the trip. I'm going to do all these different things."

Having the vision is what gives you passion. This passion is what makes you want to get up in the morning and go after those things.

Disruptions and Interruptions

Certainly there will be disruptions or interruptions. All of us are going to hit stumbling blocks and to create a plan without planning for the stumbling blocks is asking for disaster. Just as in cooking, you must try to avoid the interruptions to your finances.

For example, while cooking, I can shut off my phone or I can be sure I have all the ingredients to get started. Disruptions or interruptions must be the exception, not the rule. The cooking analogy here is that you have to have the ingredients for your cake absolutely spot-on at the right temperature so that the end product is right. If you get distracted by a phone call and then return to your baking, chances are that the cake may not turn out right; you can blame that on the disruption.

So, you have to be able to handle financial disruptions or interruptions. They will come up and you must be prepared. If you look at the financial situation throughout the world during the past two years, you know it hasn't been fantastic. Too many people, who lost money in their investments, simply didn't think they were going to have the disasters that occurred. They were not prepared because (A) they didn't understand what they were getting into; (B) they didn't understand the product; and (C) they didn't think that they would be affected. Unfortunately, they didn’t talk to someone who really knew what was happening with that product.

Also, they didn't have access to the information that financial advisers get - demographic information. This type of information will tell those advisers and thus their clients, exactly where they were positioned in the financial spectrum at that time...