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Tuesday, January 29, 2008

REVIEW: Cash Machine for Life

Loral Langemeier flips the proverbial bird at the average personal finance blogger. She writes,

If you want to sit around counting pennies and live a smaller, have-to life, then focus on your debt. In fact, I promise you that if you spend the next year focused on getting your debt down to nothing, you will have exactly that at the end of the year-- nothing. Focusing on debt is like dieting without exercise. It's an endless cycle of starvation and deprivation with no lasting results. (pg. 3)
And, since I'm one of the rare few who made it a point never to carry either school or credit card debt, I can kind of see where she's coming from. She continues:
A colleague of mine drinks three iced quad venti nonfat no-whip mochas a day. His monthly coffee habit is some people's car payment.
She neglects to mention his heart exploded from caffeine overload, and even the EMS crew left the scene buzzing, only to get run over by the Maserati-driving barrista who profited from his loss.

Anyway, Langemeier has written three (3) books with "Millionaire" in the title. How's that working for you, Loral? The latest one is about creating a "Cash Machine for Life." She outlines this with her proprietary (her word) Wealth Cycle (string of trademarks here), which is our first warning sign. Always beware authors , talking about money, who have clearly made that money by talking about making money (I include my cat in that group), or worse yet, selling a proprietary system that makes you money.

Langemeier does, as seminars and exclusive networking opportunities. They look better than those "Millionaire Cat" seminars, where you point at your cat and yell, "I HAVE A MILLIONAIRE CAT!" But they still leave me a little wary.

Fortunately, her book is useful, mainly for how it defines "Cash Machine." It is NOT a pie-in-the-sky great idea, like franchising MMA CATpitalism interactive scratching post sellers all through the world. It IS, however, a laundromat. Or a car wash. It has to make money NOW. And it should be related to what you already know, not what you want to know. So for me, it's not DOGpitalism-- no, I know cats, so I should focus my energies there. For instance, start a consulting business where I explain to cat owners how to realign their portfolios into cat-friendly equities.

To build a Cash Machine, she emphasizes the fast & the practical. Two ideas stand out: "Seven Weeks to Sales" and the necessity of NOT being a "Lone Ranger." I never watched Westerns, so I'm glad she explained that she meant to find a mentor, a model, and to get other people to cover your weaknesses. I, for instance, am bad with setting things on fire, so I would outsource that to a contractor. If my Cash Machine for Life involved setting things on fire. Which it doesn't.

The "Seven Weeks to Sales" walks through a process not just of coming up with a business, a plan, and a team, but a structure. You have to make it a legal entity. For her model, it's non-negotiable. That way, you can expand it, hire others to do the work, and-- most importantly-- sell it later.

She gives some web extras that deserve mention. One, a PDF of Cash Machine ideas, lists 25 pages' worth of every job known to humankind. A sample:
      • Pick-up kids from school
      • Tutoring
      • Pet Psychic
      • Advertising Coach
      • Personal Assistant Service
      • Mobile Coffee Truck
      • House Sitting
      • Pet Sitting
      • Flower Shop
It is so encyclopedic as to be quite useless, and kind of thoughtless. I can't imagine she expects anyone will read it.

So, fair enough. Some other books cover similar ground, but not with her emphasis on the nuts-and-bolts. Business organization and legal structure are perhaps the most important part, but books like The Four Hour Work Week flit right past them. She gives them due attention. You'll still have to hire an accountant or a lawyer, but at least you'll know what to ask.


How This Book Gave Me the Gout, a Misunderstood Disease Not Just for the Old Rich:
  • The "proprietary" nonsense. It's a sound set of principles, but a "process" only so she can sell it-- so it's jargon-heavy. I can't stand jargon, and having not yet read her other two books, much of this book is rougher going than it has to be.
  • The organization. She relies a lot on stuff from her Cash Machines Seminars, so the book can be needlessly hard to follow. In other words, should I just take the seminar? Well, I'm not interested in furthering your Cash Machine, because those kinds of things are always fluff. It's a good time management principle: AVOID MEETINGS. In my book, Seminar = Meeting.
  • Learn to write better or spend more for your ghostwriter, whichever it is. If this book is a bestseller, it's because people want money, not because you can write your way out of a wet paper bag.
How This Book Fed My Cat Delicious Tunafish:
  • Has a sense of the legal ramifications of business-- what other money-machine book talks about due diligence?
  • She's right about getting rich. So many people have long-term plans to retire rich, but in the meantimes they bend over backwards to pinch pennies. Rather, building more income streams-- especially passive ones-- makes more sense.