As you might imagine, I'm getting some requests to review new/soon-to-be-out books (and other products). I thought I'd use this post to share with you what sort of system I'll be using to rate these items. And since most of the products will be books, I'll put the scale in terms of a book.
Before I detail my system, I must clarify that I listen to far more books than I read. Listening to an audio CD takes a lot less time than reading and can be done while I'm doing something else (exercising, driving, mowing the lawn, etc.), so this is my preference when it comes to "reading" books. In the rating system below, I take into account that audio CDs require much less time commitment than reading and can be done while accomplishing other tasks. As such, some books that may not be good enough to warrant reading time will be good enough to listen to.
On the other hand, I prefer paper books if the book is something I'll want to refer to from time to time or has several important passages that I'll want to review. I underline, highlight and take notes in the book itself for future reading, review and studying. You can't really accomplish this with an audio CD.
That said, I plan to rate all my reviews on a 0 to 10 system (giving a number of stars for the products) using the following guidelines:
0 stars = Hope and pray you don't hear about this book ever again. It's not worth your time to even listen to it.
1 star = Ok, it may have some redeeming value, but it's still not worth your time to read (or even listen to the audio CD).
2 stars = It's "ok" or "fine", but certainly nothing special. Check out the audio CD at the library and skim it for the important parts.
3 stars = The book has some content that makes it worth the time to check it out at the library if you can't find the CD. Skim it for the important parts.
4 stars = Worth listening to the entire book once. Check out the audio CD at the library, listen to it, and apply as appropriate.
5 stars = It's worth the time to check it out at the library and read the book. Apply it as needed.
6 stars = Buy the audio CD, listen to it as many times as needed to fully understand and apply it.
7 stars = Buy the book, read it as many times as needed to fully understand and apply it. Underline the important parts. Refer to it as needed.
8 stars = Buy the audio CD, listen to it several times, and take notes on what to apply. Listen to it on a regular basis (at least once every other year or so) to remind yourself of the key principles.
9 stars = Buy the book, read it several times, and take notes on what to apply (underlining the important parts). Read it on a regular basis (at least once every other year or so) to remind yourself of the key principles.
10 stars = Contains positive, life-changing concepts with eternal principles that can impact your life dramatically. Read it regularly and make sure its key principles are part of your annual resolutions. Do all you can to get as many people as possible to read the book, knowing it will help them out. Give it as gifts, talk about it to friends, and promote it in your business.
As you can imagine, there are only a few books that get an 8 or above from me. A short list of books (not all money related) I'd put in this category are:
What books were sub 3 stars?
Posted by: jim | December 23, 2005 at 04:41 PM
I would add 'The Millionaire Mind' to the list; I found it every bit as inspiring as the 'MND', and I would rank both a '10'.
Do you have any feelings on Robert Kiyosaki, of the Rich Dad / Poor Dad series? I have a few thoughts, most of which are quite negative.
Posted by: CPA1298 | December 23, 2005 at 08:10 PM
Jim -- I don't have a listing of all the books I've ever read, but believe me, I've had a lot below 3 stars (unfortunately). Fortunately, most of them have been checked out from the library and I've recognized them as losers after the first 30 pages or so. (which isn't bad on an audio CD as far as time goes).
CPA -- I haven't studied Robert Kiyosaki enough to have an opinion about him per se. I have read Rich Dad Poor Dad and generally, I agree with the principles in it. However, I do understand that since he wrote that he's taken an increasingly anti-establishment (and to some, strange) view on personal finance. I won't be able to form a full opinion until I read a bit more from him, but knowing what I know, I'm not sure it's worth the time.
Posted by: FMF | December 23, 2005 at 08:40 PM
I have read most of the books on your "A" list. They represent an excellent selection. For beginning investors I would add William O'Neil's book on "How to Buy Stocks."
Posted by: Rebound Trading Systems | December 26, 2005 at 11:12 PM
I have read several books in the Rich Dad / Poor Dad series. I like them, with two caveats. First, they bear a strong stylistic resemblance to The Richest Man In Babylon. They share some of the good points of that book in that both make some very important points about personal finance and investing in the form of parables. You will get much of the same value for The Richest Man In Babylon in that respect. Secondly, not all of Kiyosaki's advice is not for everyone or for every stage in your investing career. I suspect that most of it is useful to some of his audience.
Read Kiyosaki carefully. There are some real gems of universal advice. One I particularly liked was to not view your home as an asset. It's a good example of why you should think about his advice. I agree that your home is not an asset per se. However, I disagree that it is solely a liability. The reason is that most liabilities are things you can do without if you want to. You don't have to carry a credit card balance or take out a loan to buy a car, but you are going to have to wait longer to make purchases. However, you need a place to live, whether you buy or rent. As such, I would rate his books favorably, but in the neighborhood of about 5-6 stars.
Posted by: Dale G. | April 03, 2006 at 03:13 PM