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FOOL'S EYE VIEW
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Last month, I was sent a review copy of yet another financial book. As a financial writer, I receive so many that I've become very cynical (you know the sort of thing: "Learn to Read the Rings of Saturn and Become a Billionaire Investor", Gormless Press, £19.99). To be honest, I've read precious few financial books - I'm largely (badly) self-taught. However, in recent weeks, I've been studiously reading what I believe to be one of the best financial books that money can buy. It's The Money Diet by Martin Lewis, a popular consumer finance journalist. Martin is the self-styled "UK's only money-saving expert" (I'm willing to overlook this boast!) and an outspoken consumer champion. One reason why I really like this book is that Martin's ambition is also mine: to help you to hang onto more of your money by making better financial decisions. Although many of Martin's financial tips can be found on his free Money-Saving Expert website, I'd urge you to buy his book. If you don't need a copy, buy one for a friend, relative or colleague with bad spending habits! So, what can The Money Diet do for you? By following Martin's money diet, a typical British family could save around £6,000 a year - with few lifestyle changes. Essentially, this involves becoming a smarter consumer, cutting your spending and bills, finding Best Buys, avoiding rip offs and organising your finances better. Martin's advice boils down to ten basic elements: 1. You're the boss. Don't be scared to take control of your finances - after all, it's your money you're spending. A little knowledge goes a long way: learn the rules of the game, take time when making financial decisions, and aim to win. 2. Understand your spending. By learning to budget sensibly, you can stay out of debt and get the spending habit instead. 3. Work out where you fit in. Learn what makes you different to other consumers - and then exploit these differences for personal gain. Which financial products work for you will depend on whether you prefer a stable relationship or leapfrog from deal to deal. A little self-analysis often pays off. 4. Be a smarter shopper. Get more for less by learning to control your 'impulse buying'. You can still indulge in a bit of retail therapy, but your money will stretch a lot further. 5. Forget loyalty. Be loyal to your family and friends, not financial services providers! If you buy all your products from one supplier, you'll be taken for an expensive ride. 6. Talk to people. Do your research: ask switched-on friends, family and colleagues for advice. People who've found great deals are usually happy to share their wisdom with you. Use Internet search engines, price-comparison websites, Teletext, newspapers and magazines in your search for Best Buys. 7. Haggle. The price you see is the maximum price required to obtain any goods - it needn't be the price you pay. 8. Exercise your rights. If you've found a smashing deal, don't put up with poor service - and don't let existing suppliers take your custom for granted. If you're not happy, vote with your feet! 9. Think like they do. Start thinking like companies do, check their small print, and figure out how they make money from you. Only then can you can come up with ways to cut their profits! 10. Find the loopholes. Ask yourself how you can make money out of them. By exploiting special offers - and using products in different ways from those originally intended - you can get your own back. Of course, The Money Diet gives you much of the essential information you need to become a smarter consumer, including how to: Of course, no book can be a perfect guide to financial management, but The Money Diet leads the way. However, there are a few omissions: it doesn't explain how a cheap, simple index tracker will beat most investment managers, nor does it show you how to get twice as much life cover for a few pounds more. Nevertheless, this is by far the finest book on budgeting, spending, borrowing and saving that I've ever found, so I'm giving it a massive thumbs up. If you want to live below your means, this is the book for you! More: Buy this book at the Fool Bookshop | Living Below Your Means discussion board.