Have a goal to read more books or improve your finances this year? If so, why not combine the goals? Below is a list of some of the best personal finance books out there. Read one (or all of them) this year to become more financially literate and take practical steps to improve your financial situation.
Table of Contents
I will Teach You To Be Rich by Ramit Sethi (2009)
Much of the money advice we hear involves a lot of dos and don’ts and intimidating terminology. But in”I Will Teach You to Be Rich,” Ramit Sethi goes beyond math and focuses on the psychology of money, walking the reader through a practical, six-week program. Sethi writes in a down-to-earth, humorous style that makes this an easy read. You can download the first chapter of the book at http://iwillteachyoutoberich.com/blog/thank-you/first-chapter/.
Notable quote: “Investing is the single most effective way to get rich. By opening an investment account, you give yourself access to the biggest moneymaking vehicle in the history of the world: the stock market.”
The Millionaire Next Door by Thomas J. Stanley and William D. Danko (1996)
“The Millionaire Next Door: The Surprising Secrets of America’s Wealthy“ reveals seven traits that appear again and again among millionaires. The observations in the book come from interviews with millionaires, many of whom are blue-collar workers—in other words, the people next door.
What are the seven traits? The millionaire next door:
- lives below their means,
- Spends time learning how to build wealth,
- Prioritizes financial independence above social status,
- Didn’t rely on parents for financial help once becoming an adult,
- Raises economically self-sufficient children,
- Successfully targets market opportunities and
- You have chosen the right occupation.
Notable quote: “Wealth is more often the result of a lifestyle of hard work, perseverance, planning, and, most of all, self-discipline.”
The Psychology of Money by Morgan Housel (2020)
Money can make us irrational, and when we’re making money decisions, we can behave with overconfidence, impatience and anchoring bias (the tendency to rely too much on the first piece of information we learn about a topic). These irrational beliefs and the emotions surrounding money have a real effect on our personal finances and, by extension, the global markets. In “The Psychology of Money,” Morgan Housel takes a look at these topics, sharing anecdotes, research and advice.
Notable quote: “There is no reason to risk what you have and need for what you don’t have and don’t need.”
The Richest Man in Babylon by George S. Clason (1926)
Este classic book shares “the success secrets of the ancients” through parables set in ancient Babylon. It just goes to show that principles of financial management are timeless! In the book, George Clason covers thrift, financial planning, personal wealth and more.
Notable quote: “’A part of all I earn is mine to keep.’ Say it in the morning when you first arise. Say it at noon. Say it at night. Say it every hour of every day. Say it to yourself until the words stand out like letters of fire across the sky.”
Your Money or Your Life by Vicki Robin and Joe Dominguez (2008)
“Where’s all the life we supposedly made at work? For many of us, isn’t the truth closer to ‘making a dying’?” said Vicki Robin at http://yourmoneyoryourlife.com/book-summary/.
The book goes through nine steps to create a new “road map” for money:
- Making Peace with the Past
- Being in the Present — Tracking Your Life Energy
- Three Questions That Will Transform Your Life
- Making Life Energy Visible
- Valuing Your Life Energy — Minimizing Spending
- Valuing Your Life Energy — Maximizing Income
- Capital and the Crossover Point
- Managing Your Finances
Notable quote: “Money is something you trade your life energy for. You sell your time for money. It does n’t matter that Ned sells his time over there for a hundred dollars and you sell yours for twenty dollars an hour. Ned’s money is irrelevant to you. The only real asset you have is your time. The hours of your life.”
Read a finance book (or five!) this year to improve your financial knowledge. Desde “The Richest Man in Babylon,” published in 1926, to The Psychology of Money, written in 2020, the finance books of the last century boast a lot of gems. And to keep yourself informed about current finance trends, check out the helpful links at http://merrillfinancialassociates.com/useful-links/.