Killing Sacred Cows Blog

| Book Review | Response #1 |

In a recent review in the St. Petersburg Times, personal finance editor Helen Huntley writes, "[Killing Sacred Cows] makes some good points. I agree that you need to take responsibility for your own financial success and you should invest in yourself and your money-making potential. However, the main purpose of the book seems to be to convince you to cash out your 401(k) -- he doesn't mind that you have to pay income tax and possibly a 10% penalty -- and pay Gunderson to show you how to manage your money. If you 'apply' for his program and you have enough money, you just might be accepted!"

We appreciate this perspective because it brings out three valuable things to discuss and clarify: 1) The primary focus and main purpose of the book, 2) Garrett's position on what you should do with your 401(k), and 3) The purpose of Garrett's "program" in question (the Financial FastTrack process that qualified participants of the 401(k) Hoax Challenge experience) and the reason behind the application process.

This post will deal only with the first point, and the second two will be discussed in subsequent posts. And none of these posts are meant to single out Helen Huntley; we simply raise these points because they are common points, indicative of typical perceptions about the book and its message.

The Main Purpose of Killing Sacred Cows

While Mrs. Huntley graciously agrees with the book's focus on personal responsibility and investing in oneself, her perception of its main purpose is reversed; what she mentions as "good" points (personal responsibility/investing in oneself) are the main points, and what she states as the "main" point (detailing the risks with 401(k)s) was a good point taken out of context. It's an understandable mistake, especially when one hasn't read the entire book, as Helen admits in her review.

As stated in the Introduction (pg. xvi),

"The purpose of this book is to train your mind and help you to cultivate the ability to be able to see through the myths that limit wealth creation. If this is accomplished, you may well experience a productivity breakthrough on an unprecedented scale...

"My purpose isn't so much to identify and answer every myth for every reader as it is to just get readers thinking about the rhetoric, propaganda, and traditional 'logic' that we're fed through the financial media."

Wanting to give her the benefit of the doubt, Mrs. Huntley's remarks made me wonder if perhaps we don't emphasize enough personal responsibility, stewardship, investing in oneself, and Soul Purpose, and if we over-emphasize the problems with 401(k)s.

Not wanting to go on gut feelings and knee-jerk reactions -- as those who are entrenched in financial myths often do -- I took a scientific approach, did a lengthy and in-depth search of the book, and extracted the following data on the major concepts that we focus on. The appearances of the words that I highlight below were only counted if they were in the proper context. (In other words, I could have counted much more, but I wanted to be as objective and fair as possible.)

In the context that I speak of, the word "responsibility" appears 77 times in the book, with 22 uses of the variation "responsible." "Stewardship" is used 30 times; "steward" 20 times. We speak of "Soul Purpose" on 124 occasions throughout the book. And most importantly, 61 times we use variations of the word "invest" in the context of teaching that the best investment one can make is an investment in themselves through education. The total uses of each of these words and phrases in their proper context -- which together represent our primary focus -- comes to 334.

Constrast that to just 78 mentions of "401(k)s."

(I eliminated all occurences of these words and phrases that were not relevant to the actual content of the book, such as references in the table of contents or the index.)

Clearly, something went wrong with this reviewer's analysis, yet it provides an excellent opportunity to illustrate the power that financial myths can have over us -- when subject to the myths we see only what we want to see. We see the things that coincide with our current beliefs, and casually reject anything that challenges our beliefs. Since 401(k)s are so popular, anything that challenges them will stick out much more than the things with which we agree, or think we already know.

As we learn in the Introduction of Killing Sacred Cows (page x),

"It's human nature to relate things that we are unfamiliar with back to the things that we are already familiar with, or with the things that we think we know. But what if the things we think we know are false, or at least misguided? How can we make sense of new things when our frame of reference is distorted or not founded in truth? One of the most critical steps we can take toward financial freedom is to accept the possibility that what we though to be true may be completely false, and that there are infinite truths we have yet to learn."

The main purpose of Killing Sacred Cows is not to convince any individual reader to cash out their 401(k). In fact, such a direct exhortation is not even a purpose of the book. We completely agree with Helen Huntley that to make such a blanket recommendation -- without knowing the context of the lives of individual readers -- would be highly irresponsible and inappropriate.

If any of our readers have taken this to be the core message of the book, we stress that it was not our intention. Targeting the 401(k) was a way to highlight the importance of self-reliance, responsibility, and stewardship -- not to make a specific financial recommendation to readers.

While we do, quite strongly and in no uncertain terms, detail the inherent dangers of 401(k)s, qualified plans, and the accumulation theory of wealth creation, we never once recommend to any reader that they should liquidate their qualified plan. (This will be discussed in the next blog post.)

The main purpose and primary focus of Killing Sacred Cows is to teach that individuals must take personal responsibility for their prosperity, be wise stewards over their assets and resources, invest in themselves, and live their Soul Purpose. It is to teach people that they are their most important investment -- not products, techniques, or strategies. It is to teach that what happens within a person determines what happens in their external world. It is to detail universal, timeless principles of wealth creation. It is to teach that these things are far more important than -- and determine the success of -- financial products, techniques, and strategies.

This is contrary to much of the traditional financial services industry which teaches people that the right financial products are what matter. Such advisors often recommend products without knowing the full context of their client's lives. We're taught that just throwing money into mutual funds and qualified plans and letting them sit for 30 years -- without knowing what they're doing, where the money is going, who is managing it, how to control it, and how it's creating value in the marketplace -- is all that's needed to make people's retirement dreams come true.

Garrett's point is that people need to take a step back from that flawed approach, invest in themselves, consider every angle, know what they're doing before they invest, and invest based on a macroeconomic plan that takes every aspect of their financial situation into consideration. People must stop believing that financial products -- such as 401(k)s -- have intrinsic value and that people hold the only intrinsic value.

| Book Review | Response #1 |

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