Killing Sacred Cows Blog

| Book Review | Response #1 | Response #2 |

 This is the continuation of a series of responses to a review of Killing Sacred Cows by Helen Huntley, personal finance editor for the St. Petersburg Times. While she does her best to give a synopsis of the book without reading it entirely, at one point she says, “…the main purpose of the book seems to be to convince you to cash you’re your 401(k) -- [Garrett] doesn’t mind that you have to pay income tax and possibly a 10% penalty…”

I’ve already discussed what the main purpose of the book is, and now I want to talk about the 401(k) issue.

If any readers are taking from the book that Garrett is specifically recommending to them that they should liquidate their 401(k), we stress that this is not the case at all. While we do deal extensively with the dangers of qualified plans, we never once make the blanket recommendation that every individual should cash out of them.

In fact, to be true to the thesis of the book, there may be some for whom the advice we give is not a good fit at all based on the context of their individual circumstances. One aspect of the conventional financial planning industry that we take issue with is the practice of recommending products and strategies out of context.

There’s a significant difference between content and context. In this case, how we discuss the 401(k) is content; the context in which that content is discussed says that your financial decisions are unique to you and your situation. For some people, a 401(k) may be great; for others it may be useless. If people can overcome the fifteen dangers of a 401(k) that we outline on page 253 of the book, a 401(k) would be a perfectly suitable investment for them. For some, whole life insurance is a productive, valuable product; for others it would be a big mistake. For some, stock market investing is great; for others it is risky and destructive.

There Are No Risky Investments

One of the most important points of the book is that there are no inherently risky investments; just risky investors. It is individuals that determine the success or failure of any investment.

As Garrett says on page 150,

"What is risky to one person could be the safest investment in the world for another. Any time someone asks me questions such as, 'Is real estate risky?' or 'Isn't it risky to quit your job to start a business?' my answer is always, 'It depends.' These things certainly can be risky -- to some people -- but they can also be very wise and safe for others.

"I have friends who have done very well in real estate, and others who have lost big with real estate. The difference is that those who do well have more knowledge, they write better contracts, they know how to manage their properties, and they mitigate their risk by doing thorough due diligence on the people who use their properties. In addition, those who I've seen thrive with real estate happen to love working with real estate; it's in their Soul Purpose. The others have very little knowledge of real estate (most of the time they get into it only because they think it will make them a lot of money), they write poor contracts that open them up to great risk, they manage their properties poorly, and often these properties are damaged by renters the owners never checked out properly. The risk or lack thereof isn't in the real estate; it's in the people who invest in it."

So what should you do with your 401(k)? Quite simply, without knowing the context of your life, we don’t know. Garrett would never make such a direct recommendation without knowing the context of your life and he’s not trying to directly convince you to cash yours out in the book.

What You Should Invest In

Another criticism that Helen Huntley makes in her review is to say, “The only investments he endorses in the book, at least in the parts I read, are real estate and permanent life insurance.” Once again, the problem with this is that she speaks of content out of context.

Just as liquidating a 401(k) is never recommended for any particular individual, likewise real estate and permanent life insurance are never specifically endorsed. They are discussed at length, but only to provide examples and explain certain concepts. They would only be endorsed within the proper context.

The one investment that is directly recommended for every reader is an investment in oneself. As you’ll find on page 155,

“There’s one critical litmus test to perform on yourself whenever you are wondering what to invest in. The answer is always – without exception – to invest in yourself. If your human life value were developed enough and if developing it was your first priority, you would never need to ask what to invest in, because your path would be clear. The best investment you can ever make is to increase your human life value, or your ability to utilize your knowledge and abilities to create value in the world. Turn inward for personal improvement and value will flow outward to those around you.

“What this means is that you are your best investment. Not your 401(k), not your Roth IRA, not your mutual fund, not your house or your rental properties – YOU. If you want to mitigate your risk and enjoy high returns, then start doing everything you can to invest in yourself. Read books, go to school to gain new knowledge and learn new skills, attend educational seminars frequently, associate with people that you can learn from, take action and learn from your mistakes."

 | Book Review | Response #1 | Response #2 |

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| 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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Our last blog post introduced a recent book review by Helen Huntley, the personal finance editor of the St. Petersburg Times.

This is the first response of a series.

 

Deception Vs. Value Creation

Helen begins her review by writing, “I don't ordinarily do book reviews, but I often read portions of the books that publishers send me. Sadly, quite a few of them are little more than thinly-veiled sales pitches for the author's business. One of the worst of these promotional books just came across my desk, Killing Sacred Cows: Overcoming the Financial Myths that are Destroying your Prosperity by Garrett B. Gunderson.”

She makes the implicit—and valuable—point that there are often very negative aspects of salesmanship which cause people to take faulty action and spend unnecessary money. There are many unscrupulous individuals that use deception to prey on naivety in order to make money.

We join with Helen in condemning this insidious practice.

Page 120 of Killing Sacred Cows has a long section on why deception is so destructive, including the following excerpt:

“[Money is the receipt that says that we have either created value for another person, deceived them into thinking we have, or coerced them into giving it to us anyway. Of course, deception and coercion destroy human life value, our own and that of the people whom we deceive or coerce…Deception and coercion are the opposite of freedom and lead to poverty, misery, and dishonesty.”

As we write in the book, the only moral way to make money is to create value for others, to give them a reason why they should value what you provide for them more than the money they give you (see pages 120-129). On page 39 we write, “…in a world of cause and effect, value creation is a cause, and money is an effect…Money is never manifested and exchanged until value is created, and thus is an expression of value creation.” We also give our definition of value, which is, “anything of worth or service that, when provided to another, creates joy for both parties.”

To be clear, the promotion of Garrett’s products and services throughout Killing Sacred Cows, such as the Producer Power Hour and the Freedom FastTrack, was never intended to be “thinly-veiled”—it is deliberate, calculated, and very transparent. For most non-fiction authors, the entire point of publishing a book is to establish their credibility in their particular niche and to market their businesses.

For example, Mark Victor Hansen and Robert G. Allen promote the Enlightened Wealth Institute through The One Minute Millionaire. Stephen Covey promotes Franklin Covey through The 7 Habits of Highly Effective People and others. T. Harv Eker promotes Peak Potentials Training through Secrets of the Millionaire Mind. Robert Kiyosaki promotes a wide array of products through his books. Michael Gerber promotes his entrepreneurial institute through The E-Myth. Seth Godin uses all of his books to promote his businesses such as Squidoo. Ken Blanchard promotes his consultation business through his books. Steven K. Scott promotes his mentoring programs through his book The Richest Man Who Ever Lived and others.

All of these authors are doing amazing, uplifting, and inspiring things in the world. They have much to offer beyond their books, and their books are an excellent way to market their value to society. With as much good as they are doing, it would be irresponsible of them to not market their products and services through their books.

If Garrett or any of the authors mentioned above are using their books to deceive people in order to make money, that would be worthy of a scathing review indeed. However, hundreds of testimonials from ecstatic clients attest to the fact that Garrett is creating value for others, not deceiving.

We warmly and openly invite anyone reading this to take advantage of the fabulous programs that Garrett has created to help you implement the principles you are learning in Killing Sacred Cows. No deception or coercion—we simply invite you to make the personal choice of whether or not they create value in your life.

An excellent place to start is with the Producer Power Hour Membership. In fact, we encourage you to click here to take advantage of our offer to receive one month of the membership for free. If you find that the membership does not create value for you, simply cancel your membership at any time.

Every person and business wants to and should profit from their efforts. In the absence of deception or coercion, profit is evidence of value creation—it is the hallmark of every successful and worthwhile individual and business. Furthermore, not only should every individual or company that creates value in the economy want to profit, but they also have a moral obligation to market their products and services as effectively as possible in order to reach and serve as many people as they can.

There's nothing "sad" about using a book as a sales pitch for one's business, provided that the business creates value rather than deceives or coerces. If a person is creating value for others--helping them to achieve more, be more, become more wealthy and fulfilled--then not only is it smart to use a book to promote their business, but it is also their duty to do everything in their power to reach as many people as possible. In this case it would be sad if an author created value for people in a book then did not provide further resources for readers to continue their education and tools for practical implementation.

Mrs. Huntley is right on the money if an author has deceitful intentions or if they are not creating value for others. Deceitful sales pitches are the worst kind, and many legitimate individuals, companies, products, and services are negatively impacted by those who perpetrate them, and we thank Mrs. Huntley for raising this valid point.

| Book Review | Response #2 |

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Helen Huntley, the personal finance editor for the St. Petersburg Times in Florida, recently gave a great review of Killing Sacred Cows that gives us an excellent opportunity to clarify the message of the book.

While she admits only reading parts of the book—and the review must therefore be understood in that context—she does make some good points that we’d like to respond to in the next series of blog posts.

The following is her review of the parts of the book that she read. Following this post, we will provide our responses.

Want some bad advice? Read this book

By Helen Huntley

"I don't ordinarily do book reviews, but I often read portions of the books that publishers send me. Sadly, quite a few of them are little more than thinly-veiled sales pitches for the author's business.

"One of the worst of these promotional books just came across my desk, "Killing Sacred Cows: Overcoming the Financial Myths that are Destroying your Prosperity" by Garrett B. Gunderson. It 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!

"The only investments he endorses in the book, at least in the parts I read, are real estate and permanent life insurance. He recommends buying as much insurance as possible. (Hmmm...I wonder who benefits if you buy more than you really need?) No tips here about ways to save on premiums. Instead, he trashes term insurance because it gets expensive if you keep it until you're in your 70s. Of course there is the small problem that term insurance is the only affordable way for most young families to get the amount of insurance they need. Any of them that try to follow his advice and buy permanent life insurance are highly likely to end up seriously underinsured. And I won't even bring up what happened to all those smart people who had bad timing investing in Florida real estate. Instead of losing part of your investment to the stock market downturn, you could have lost it all to the real estate market."

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