Want to Get Started with Wealth. Here are TNFG’s Top 10 Best Personal Finance Books
Where to Start with Personal Finance
If you don’t know where to start and how this entire personal finance journey transform people into millionaires and then multi-millionaires, this is the way. These are some of the most renown personal finance books known for helping people set budget, make plans, enjoy travel; all while becoming automatically wealthy. This is a list of my favorite financial books for beginners.
Furthermore, if Facebook was the last book that you read, I completely understand. For non-readers or if you have travel time to fill, check out Book Insights Podcast and the Swedish Investor for the YouTube audio. There is almost no excuse to stay in the dark when it comes to knowledge.
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These are TNFG’s Best Personal Finance Books for Beginners:
- The Automatic Millionaire by David Bach
- Your Money or Your Life by Vicki Robin
- Think and Grow Rich by Napoleon Hill
- I Will Teach You To Be Rich by Ramit Sethi
- The Simple Path to Wealth by JL Collins
- The Two-Income Trap: Why Middle-Class Parents are Going Broke by Elizabeth Warren
- Women & Money by Suze Orman
- The Millionaire Next Door by Thomas J. Stanley
- Spend Well, Live Rich by Michelle Singletary
- The Intelligent Investor by Benjamin Graham
Making Money, Make More Sense With these Personal Finance Book
I’ve been on the financial literacy journey since 2012. Although I’ve been asked several times, there isn’t one particular book that stands out to me as the ultimate Financial book. Instead, personal finance comes down to perspective and lived experiences.
My favorite book is The Mentor Leader by Tony Dungy. It’s not about money however, it plays on the notion of lived experiences and how we can help to mold and guide each other. I think I’m a fan and learn better through stories.
As such, there are books out there for every stage of life and for every money goal, whether you want to retire early, build wealth for the long term, start conversations about money with your family, or just see money from a different point of view. Most importantly, there are more diverse perspectives popping up everyday or messages that some how transcend time.
Although there isn’t anything new under the sun, these titles spark joy. Turn joy is more powerful on the journey to wealth; even better than greed or hate. While the other two might end up harming you, joy gives way to peace, and it’s priceless.
So from timeless advice to detailed budgeting breakdowns for millennials, here are TNFG’s top 10 personal finance books:
1. The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich, by David Bach
Key Lessons: Making an actionable plan, Setting up systems that automate positive behavior, and Conceptualizing wealth
“A latte spurned is a fortune earned.”
The Automatic Millionaire is an actionable, step-by-step plan for building wealth without being disciplined by relying on fixed percentages, small payments, and automated transactions.
David Bach teaches one simple principal: automating your finances. Sharing anecdotes about his grandmother, I think we can all relate to their tenacity for meal prepping before it was delivered at our door, arts and craft before etsy, and side-hustling before passive income conversations. From saving to paying off debt, setting up your finances to manage themselves could help grow wealth.
The Net Max Financial plan puts that in motion; investing to the maximum in 401ks, IRAs and HSAs for even 15 years at the historical average of 8.03% that’s a total of $1,641,430.55. You can definitely find the automatic millionaire approach with this magic equation of compound interest.
2. Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence, by Vicki Robin
Key Lessons: People who want to retire early, Setting up systems to build wealth
“Money is something you trade your life energy for. You sell your time for money”
Reaching Financial Independence (FI) should be the destination for everyone. FI is not driving around in luxury cars, or living in a 15 room mansion; FI is about peace. At the core of “Your Money or Your Life” is a plan to get to that goal. Too many people are trapped on the Hedonic treadmill. Stop me if I’m wrong; people work then buy stuff to feel as if they made it. The thing they bought cost a lot. So they work for promotions, raises or other jobs just to buy more and upgrade expensive stuff.
It’s just too much to keep up with. Why work only to entrap you to work forever, this book gives advice for every aspect of becoming financially independent, from the wealth mindset to investing for the long term. This is a shortcut to living the life, we really want to minimize spending life energy on stuff.
So the question is to you, do you want to retire early or work to death? It’s your money or your life.
3. Think and Grow Rich, by Napoleon Hill
Key Take Aways: Inspiration, Classic perspective on Wealth, and a Boomer’s approach to wealth
“All Achievement, All Earned Riches, Have Their Beginning In An Idea.”
Written in 1937, this is a personal finance classic. The book focuses on building a resilient mindset to move the needle toward wealth. Financial trauma affects our Financial IQ; the only way to fix it is with perspective. This book incorporates stories from the 19th and early 20th centuries, which provides context for the future.
It’s strange that no matter how many thing change, the more the core of life remains the same. If you want to know more about Financial Awareness and how to building the three components, check out “How to Increase Your Financial Awareness.”
4. I Will Teach You How to Be Rich, by Ramit Sethi
“The real lesson is: When companies-and people-show you who they truly are, believe them.”
Key Lessons: Making a plan, Setting up systems to build wealth, and Millennial’s approach to wealth
Ramit Sethi (seeing in picture) turned from “ a geeky little Indian kid “ into one of the leading personal finance experts in the last decade.
In an interview the Jamila Souffrant on her blog “Journey to Launch Podcast”, he asked Why?
Why do you want to be rich? Better yet, he followed the question with “then what?” These are poignant ideas of wealth that need to be challenged in the age of Instagram and consumerism. I think that’s why he resonates.
Many are living from paycheck to stress, with little to no savings, rising mental health issues and no plans for the future. This book cuts through it all with a solution driven 6-week program that’ll help you to start managing your money better and live a more fulfilling life.
This book lays out a plan, focus on the big changes because the small ones are inconsequential.
5. The Simple Path to Wealth: Your Road Map to Financial Independence and a Rich, Free Life, by JL Collins
Key Lessons: Investors, People who want to retire early, and Automated Wealth
“There are many things money can buy, but the most valuable of all is freedom. Freedom to do what you want and to work for whom you respect.”
JL Collins built another great roadmap to financial independence and a rich, free life. Gone are the days of map quest and getting information from the local gas station, you now have access to a full financial GPS on automating success.
First laid out in a series of letters by the author to his daughter, this book is filled with actionable advice on investing. The book does an excellent job sharing data that prove that the stock market (on average) always goes up. The author presents a simple way to invest in the stock market through mutual funds and index ETFs.
In your late 30s and 40s, it’s critical that during the wealth accumulation phase, saving and investing as much as possible is critical. If you can push for 50% or more, you will be working way less over your lifetime
6. The Two-Income Trap: Why Middle-Class Parents are Going Broke by Elizabeth Warren
Key Lessons: People who want to retire early, People who want to build wealth, Fear based
The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke is a 2004 popular nonfiction book by now-Senator Elizabeth Warren and her daughter Amelia Warren Tyagi. The book is an expose of the American dream in modern time while examining increasing rates of personal bankruptcy, economic insecurity and wealth inequality.
Today’s dual income family earns 75% more money than its single-income counterpart of a generation ago, but has 25% less discretionary income to cover living costs. The Pandemic expose the conspicuous consumption happening in the US. The high cost of luxury living will eventually bite people in the A**.
Regardless of your family’s financial situation, knowing your net worth is a critical component of understanding how your income nets against your expenses. It can help you evaluate your financial health, set SMART goals and plan for generations to come.
So the question you should ask, is your family falling behind or getting ahead?
7. Women & Money, by Suze Orman
Key Lessons: Making a plan, Putting the whole family first, and Focusing on Feminine Finance
“Lasting net worth comes only when you have a healthy and strong sense of self-worth.”
For some reason, many in the Financial Independence and Retire Early (FIRE) movement hate Suze Orman. AS stated in the intro, just take the message for what it is, lived experience. Suze Orman started out waiting tables and worked her way through misery to get to this point. It’s worth reading and understanding her perspective, especially for women.
Her latest book, “ Women & Money” focuses on how women earn, invest, and save, and gives pointed advice for retirement, marriage, and more. The goal is to insure that women don’t retire broke or destitute. If man’s goal is to not go broke dating, women should be cautious to now live broke later.
Women & Money speaks to every mother, daughter, grandmother, sister, and wife. If you care about the ladies in your life, this is a great book for you too. My mom is retiring so I have to understand money from her perspective.
8. The Millionaire Next Door, by Thomas J. Stanley
Key Lessons: Inspirational and Aspirational concepts, Automated processes and systems to generate wealth, Core Values
“Once you’re in a high-income bracket, say $100,000 or $200,000 or more, it matters less how much more you make than what you do with what you already have.”
Thomas J. Stanley analyzed and wrote about America’s wealthy citizens and found very interesting facts. Millionaires have seven core habits, including living below their means, rejecting traditional consumerism, focusing on minimalism, and investing more than you spend. The book also pitches how to avoid critical financial mistakes on your way to financial independence.
Around 55% of all millionaires attest their wealth simply to being deliberate about their finances and disciplined saving. While most millionaires are first generation, meaning they didn’t come from money nor capital infusions.
9. Spend Well, Live Rich: How to Get What You Want with the Money You Have, by Michelle Singletary
Key Lessons: Budgeting, Money Management, Personal finance for beginners
“Generosity isn’t about how much you spend. It’s about how much thought you put into the gift.”
Author Michelle Singletary shares and reflects on the lessons from grandmother, who raised five children on a modest salary. Singletary looks into the principals that her grandmother used with her own finances to make the most of what she had. It’s best for anyone wanting inspiration on making the most of the money they already have.
10. The Intelligent Investor by Benjamin Graham
Key Lessons: the old approach to investing, Young professionals, Personal finance beginners, and Investing Concepts
“Those who do not remember the past are condemned to repeat it.”
About The Intelligent Investor, legendary investor Warren Buffett, who Graham famously mentored, described it as “by far the best book on investing ever written.”
It touches on all of the unique challenges of today’s young adults when it comes to trading and investing.
The Intelligent Investor is widely considered the value investing old testament. Accordingly, investors should analyze a company’s financial reports and its operations. The whims of investors-their greed and fear- creates noise and fuels daily market sentiments. Especially during the time of 24hr media, any little statement can spur a full on sell off.
While it might not be a good fit for Robinhood day traders, it’s a great starting point for beginner investors. Buy with a margin of safety, and hold based on your Risk Profile and/or capacity. Most importantly, do the research.
Disclosure: This post is brought to you by the Neighborhood Finance Guy. We highlight financial literacy information, resources, and more on your way to money management goals and personal wealth. Our goal is to help you make S.M.A.R.T decisions with our money. We do not give investment advice or encourage you to adopt a certain investment strategy. Your personal finance is up to you. If you take action based on one of our recommendations, we don’t earn a dime as of 5.2021. We operate independently.
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Originally published at https://theneighborhoodfinanceguy.com on June 14, 2021.