We are living in an age where financial literacy has never been important. People do not know how to handle their money, they get into debt because of poor budgeting and end up paying high-interest rates on their credit cards.
Personal finance books can help you get started with your personal finances by giving you advice about savings, budgeting, investments and planning for retirement. The following are some great personal finance books, old and new classics that you must read.
“The Richest Man in Babylon” by George S. Clason
The book is a collection of parables set in ancient Babylon and follows the story of Arkad, who seeks to learn the secret to becoming rich through all his peers who believe money is evil.
His quest leads him to discover seven essential lessons he must master if he wants to achieve riches beyond his wildest dreams.
“Rich Dad/Poor Dad” by Robert Kiyosaki
The book tells of the author’s progression from a child with little money and few skills, to an adult who has built his own multi-million dollar business. The book was written in 1997 and by 2005 had sold over 35 million copies worldwide.
It is the second top-selling personal finance book in U.S. history after “The Richest Man in Babylon”.
“I Will Teach You to Be Rich” by Ramit Sethi
The book was written by Ramit Sethi, founder of the financial education website “I Will Teach You to Be Rich”.
The focus is on how to achieve financial independence through wise investing of income and expenses, sensible money management skills, and teaching simple strategies for saving time and eliminating mental clutter so that readers can focus on what they truly care about.
“Think and Grow Rich” by Napoleon Hill
This is one of the most famous books on personal finance and investing. It was first published in 1937 but there are still people who read it regularly and apply the principles to their lives today.
This book focuses on ways to achieve success including finding a mentor and sticking with your goals. There is also an assisted step-by-step process for increasing wealth, health and happiness outlined in separate chapters which can have a huge impact when followed correctly during each life stage from childhood all the way into retirement.
“The Simple Path to Wealth” by JL Collins
Written by Canadian blogger JL Collins, this guide shows investors how to get started by investing in index funds. He argues that most people should use low-cost index funds to build wealth over the long term.
To make this easier, he created the stock series, which walks through how to invest in stocks.
“The Millionaire Next Door” by W.D. Stanley & D.W Danko
Contrary to popular belief, millionaires are not unique or flamboyant characters living lavish lifestyles out of touch with reality. The book was written in 1996 and is based on research done on American millionaires for twenty years by two professors of economics at Emory University, William Danko and Thomas Stanley.
They also wrote a follow-up “The Millionaire Mind”.
“Your Money or Your Life” by Joe Dominguez, Vicki Robin & Monique Tilford
Published in 1992, Your Money or Your Life examines how many people are unhappy with their jobs and relationships, despite having significant disposable income. It also explores the relationship between money and happiness more generally.
The book ultimately argues that the pursuit of money as an end in itself is often unsatisfying, and instead advocates rethinking one’s attitude towards work and financial security.
“Enough: True Measures of Money, Business & Life” by John C. Bogle
Written by Vanguard founder John C. Bogle, the author draws on years of experience to explain his theories on business success through investing, branding, leadership development especially for start-ups and entrepreneurs, and the importance of philanthropy.
“I Will Teach You to be Rich” by Ramit Sethi
The book was written by Ramit Sethi, founder of the financial education website “I Will Teach You to Be Rich”. The focus is on how to achieve financial independence through wise investing of income and expenses, sensible money management skills, and teaching simple strategies for saving time and eliminating mental clutter so that readers can focus on what they truly care about.
“The Automatic Millionaire: A Powerful One-Step Plan To Live and Finish Rich” by David Bach
This book is a guide aimed at showing young adults how to start building wealth early using a program called the Latte Factor. He argues that small amounts of money left to grow can result in large amounts of money over time.
Bach discusses the importance of living on less than you make, using your bank’s overdraft protection as a safety net, paying yourself first by saving and investing automatically, and increasing income by asking for raises or finding another job.
“The Millionaire Mind” by W.D. Stanley & D.W Danko
This follow-up to the original provides more information on American millionaires compared to the world’s most successful people in relation to education level, occupation — especially blue-collar jobs — personal savings rate, debt load, charitable giving habits, homeownership status, age at which they became millionaires and number of years it took them to reach that goal, geographical distribution and more.
It also challenges some commonly held stereotypes about millionaires such as: that most of them come from wealthy families and never had to work hard for their money; were entrepreneurs or professional business people; inherited their wealth or won the lottery; live in Beverly Hills mansions or on Park Avenue palaces etc.
“Enough: True Measures of Money, Business, and Life” by John C. Bogle
Written by Vanguard founder John C. Bogle, this book draws on years of experience to explain his theories on business success through investing, branding, leadership development especially for start-ups and entrepreneurs, and the importance of philanthropy.
“The Little Book of Common Sense Investing” by John C. Bogle
Written by Vanguard founder John C. Bogle, the book talks about index funds and other investment strategies designed to beat out high fee managers on Wall Street for average investors.
It uses a mix of his personal anecdotes, classic investing theory and personal finance advice to explain how to get started with common sense investing.
“The Smartest Investment Book You’ll Ever Read” by Daniel R. Solin
The book contains a collection of articles relating to saving and investing in general but also goes more specifically into topics such as asset allocation, diversification, rebalancing portfolios, etc.
Many examples from real life are included throughout the chapters which makes it an easy read even for beginners who have little knowledge of finance.
“The 4-Hour Work Week” by Tim Ferriss
The book tells how to outsource, delegate and automate your life in order to live the life you want while spending as little time as possible on work.
It also includes tips on how to use online tools like email, Google Docs, Skype etc. in order to free up time for more important things that bring people satisfaction instead of being stuck at a desk doing something they don’t enjoy all day long.
The author was able to cut back his work hours by 80% while earning more money than ever before just by outsourcing tasks he didn’t have patience or interest in performing himself.
“The Art of Non-Conformity” by Chris Guillebeau
This guidebook includes a collection of essays from the blog of the same name. It focuses on topics such as overcoming obstacles, making a living, self-employment and entrepreneurship, personal development and traveling more spontaneously without sacrificing comfort.
This book is a great motivation for anyone looking to live life on their own terms while being more productive in achieving their goals instead of just dreaming about it.
“The Total Money Makeover” by Dave Ramsey
The author encourages readers to get rid of all debt using his seven baby steps process which takes less than 3 years followed by investing for retirement using low-cost mutual funds instead of risky investments like stocks, real estate, etc.
He states that you should pay yourself first before paying any bills and making any other expenses.
The author is very conservative with his investments and doesn’t believe in using an aggressive approach to make more than the market returns such as picking individual stocks or timing the market.
He also advises against borrowing money for investment purposes such as buying stock on margin etc.
“The Investor’s Manifesto” by William J. Bernstein
This book is great for beginners and especially those looking to invest outside of the US. It covers topics such as asset allocation, diversification and index funds in a lot of detail while also going into risk management, taxes and inflation.
The author also advises against picking individual stocks or investing in real estate because it’s not worth the hassle when you can achieve better returns with less effort using historical market data through purchasing an index fund instead.
“How to Make Your Money Last” by Jean Chatzky
The book includes tips on how to save money while living paycheck to paycheck, reduce credit card debt, build an emergency fund, etc. The author uses a lot of easy-to-follow examples and case studies along with well-drawn diagrams to explain financial terms without overloading the reader.
“The Wealthy Barber” by David Chilton
This book provides a lot of common sense advice on how to save for retirement, pay less in taxes and build an emergency fund. In addition, it also includes tips on how to start investing outside of just putting your money into a savings account at the bank.
The author suggests that you focus on making more money by increasing your income instead of just trying to manage what you have without working harder.
How did you enjoy my list? Hopefully, you found something that resonates with you and can help with your financial journey. Please feel free to comment below with your favorite financial books.