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Larry Winget: Finding Financial Solvency With “The Pitbull of Personal Development”

by Alexander Green, Chairman, Investment U
Investment Director, The Oxford Club
Monday, February 4, 2008: Issue #759

I was reminded of a new book by Larry Winget, titled “You’re Broke Because You Want To Be,” the other day when I was browsing through a bookstore at Miami International…

A few years ago my family and I signed up with a local charitable organization to buy Christmas presents for kids whose families could not afford them. We were assigned a local family we had never met. The charity told us how many boys and girls were in the household, along with their names and ages. My kids and I had a grand time shopping for their presents – and my wife Karen, being the good sport, spent hours wrapping them.

A couple weeks before Christmas, we called the family, got directions and arranged a time to come over. The next day, I loaded up my family and the gifts. We drove across town and parked in front of a modest house in a “wrong-side-of-the-tracks” neighborhood. When the family answered the door, their kids starting cheering, my kids starting acting rambunctious, and the parents, of course, invited us all to come inside.

When we did, I couldn’t help noticing a couple things. While the home itself was rather plain:

There was a towering stack of DVDs next to the television set. (I’m talking a mini Eiffel Tower of DVDs.)
There were two huge birdcages in the living room, each holding a majestic, beautifully-colored macaw.
And, there was a 50-gallon aquarium filled with tropical fish, too.

Quite frankly, that bothered me. Why, I kept asking myself, was I buying Christmas presents for a family with hundreds of dollars worth of DVDs and thousands of dollars worth of exotic birds? Perhaps I was wrong, but that evening I left their house feeling like someone had stamped the word “Sucker” on my back…

Larry Winget – The Pitbull of Personal Developement

The book is written by Larry Winget, a fellow who calls himself “The Pitbull of Personal Development,” and, although I’ve never seen it, he is also the star of A&E’s reality series “Big Spender.” Within the show – in cahoots with family members – he ambushes over-extended consumers in the middle of a shopping spree and offers a financial plan to straighten out their lives.

Flipping through the book, I couldn’t help but chuckle every few pages. This guy is funny. And he offers “tough love” financial advice to out-of-control borrowers and spenders.

He starts out by assuring readers that his title is not meant to insult the poor. “Broke is not a condition like being poor,” he writes. “Broke is a situation you find yourself in because you are either underearning or overspending.”

Saving & Spending Your Money

When it comes to saving and spending, Winget doesn’t believe people have money problems. Instead they have behavior problems. And he doesn’t bother with any sweet talk. “I’m not the guy you go to so he can put his arm around you and say, ‘That’s okay, it will be alright.’ I’m the guy you go to when you are circling the drain.”

Winget says people who are sinking financially should forget about thinking positive thoughts and start taking positive action. “No one else is to blame for your situation,” he writes. “Broke didn’t sneak up on you in the night. A stack of unpaid bills didn’t show up while you weren’t looking. You didn’t suddenly get behind. You chose to spend your money the way you did. Your life is a reflection of the choices you have made. If you want a better life, start making better choices.”

Winget knows what he’s talking about. He grew up in Oklahoma so poor he had only one pair of pants to wear to school every day. When he got rich later in life, his business went under and he was forced to file personal bankruptcy. Within a few years he was a multi-millionaire again.

There’s No Easy Way To Financial Solvency

Larry Winget warns readers that there is no easy way to financial solvency. You either have to make more, spend less or both. His book discusses dozens of blunt suggestions like these:

Cut up the credit cards.
Give up cable television.
Get a cheaper car.
Move.
Give up your home phone – and get a new cell phone plan.
Cut your insurance expense.
Give up your high-speed Internet connection.
Stop eating out.
Stop going out.
Give up the salon.
Drop the gym membership.
Stop smoking.
Sell stuff, “including the DVD collection.” (And perhaps the exotic birds, too.)

He also has sensible advice about how readers can upgrade their skills and earn more.

Winget says, “I am not a blow-smoke-up-your-skirt, you-can-do-anything-with-a-positive-attitude kind of guy. I am a nose-to-the-grindstone, no-excuses-will-be-accepted kind of guy.”

This is a small book, but it packs a powerful punch. And perhaps its most important message is this: “Life is not made up of the haves and the have-nots – but rather the wills and the will-nots.”

Larry Winget & The Investment U Philosophy

This is a philosophy most Investment U readers have already adopted and put into practice. But, if you’re like me, you may have a circle of friends, co-workers, kids or grandkids who are learning the hard way – or soon will be.

Do them a favor and tell them about this book by Larry Winget, “You’re Broke Because You Want to Be.” It’s blunt. It’s plainspoken. But if you really care about them, send it to them anyway. Perhaps anonymously, but send it.

Good investing,

Alex

P.S. If you aren’t able to come and see me live this week at The World Money Show in Orlando, Florida, you can still “attend.” My presentation is scheduled for Thursday, February 7, from 8:00 a.m. to 8:45 a.m. EST and is being webcast for free. Here’s how to watch it online.

Today’s Investment U Crib Sheet

Regular saving remains the safest, easiest and most effective way to jumpstart your portfolio. And while it sounds awfully old-fashioned, saving is something you can control, unlike the performance of stocks. And it’s a whole lot better than trying something heroic with options, futures or penny stocks.
To see the seven ways successful savers put money aside, take a look at Investment U Issue #735, Saving Money: The Safest, Easiest, Most Effective Way to Jumpstart Your Portfolio. And to make the most of your savings, jump over to our Retirement Planning Zone for ideas. It’s free…
Just begin by finding out your “Personal ROI” – the rate of return you’ll need to achieve in order to hit your target retirement date. This is the one number that guarantees you’ll never run out of money. You can use this free ROI calculator to get your figure.
Once you have it, choose the investments most likely to produce your required rate of return. If your Personal ROI is greater than 45% a year, we recommend a “market neutral” investing approach, where you invest both long and short – the same way hedge funds invest. (For ideas, here’s how our market-neutral service works.)