Our Picks of the Top 5 Personal Finance Books You Should Read First!
There are many great personal finance books on the market. But there also doesn't seem to be one book which we think covers everything you need to know about the variety of issues with responsible personal finance management.
Some books are great for teaching you how to get out of debt, some books focus on the mentality of personal finance and how it leads to financial freedom as a mindset, others go into wealth creation strategies, and some delve into the thinking processes of those who have accumulated great wealth.
The books we are listing are the ones we think you should read first.
Even if you have a decent idea personal finance, these books will include additional guidance and ideas you may not have been aware of.
Many of them also help you avoid the debt trap by showing how your thoughts about money and material items truly affect your financial habits.
Beyond striving to become debt free, wealth creation can encompass many forms. Some propose traditional methods of making money such as through investments, retirement funds, and other interest earning accounts.
Others promote wealth building strategies through business venture activities.
Inevitably, personal finance can be boiled down to these two things: you save money by spending less than you make, and you optimally use that savings to generate additional wealth.
Yeah that's it in a nutshell, but performing those two tasks wisely can be a whole different story.
These books are recommended reading by us to those starting out so you have a firm understanding of the concepts of personal finance. And so you can start to see the mindset and benefits of not having to necessarily look rich in order to be rich.
It's the second of these principles which I believe truly allows you to build wealth because you allow yourself to be free of the “keeping up with the Jones'” mentality.
So on to our list…
The 9 Steps to Financial Freedom: Practical and Spiritual Steps So You Can Stop Worrying, by Suze Orman
Suze Orman is a New York Times best-selling author and leading financial expert. This book is a personal finance classic which has been updated but the principles are really timeless.
Her book, “The Nine Steps to Financial Freedom,” approaches personal finance from an emotional point of view and discuss how fear, shame, and anger over money issues are the main obstacles to creating wealth and financial independence.
She goes over nine simple steps you can use to become responsible with the money you have, and also responsible with money you do not have. This book is for those who do not have control over the money in their life right now.
She goes into detail on the emotional effects of money and how to free yourself from the anxiety and fear money creates in your life either by not having it or the fear of losing it.
Dave Ramsey is another personal finance icon. He has many books, workbooks, classes, podcasts, and other speaking seminars where he discusses his philosophy on personal finance and how to apply it in real life.
But “The Total Money Makeover” personal finance book is his number one product in this category.
He provides practical information for issues on budgeting, saving, and paying down debt while giving real-life examples showing how easy it is.
He also lays out his debt reduction plan using his baby steps method so that it is easy to feel real achievements even when the amount of debt seems insurmountable.
The best part about this book is the way he breaks down personal finance and debt reduction so anyone can understand it. This book spent over two years on the New York Times bestseller list and has sold close to 5 million copies.
Using his advice and his seven easy steps, this book will guide you on the path to being debt-free while also changing your attitude about money.
This book, “I Will Teach You to be Rich,” is written for the beginner discussing matters related to personal finance and investing.
The purpose of the book is to break down many of the complicated financial topics in a way where the beginner investor and personal finance students can understand the topics.
Although if you've been following personal finance, this book may be a little simple to you. It is written with the beginner in mind which is why I believe it is one of the first books you should read when you're educating yourself on this topic.
Even if you have a decent grasp of the subject, it is often helpful to find other ways to explain topics which can be helpful if you ever need to discuss personal finance with other beginners.
His suggestions in the book are very actionable and easy to follow, making it a great guideline for you.
The book, “Your Money or Your Life,” doesn't just regurgitate financial advice. It delves into the psychology of money, how people talk about money, the way you deal with money, and also the role money plays in the goals and dreams of people.
Even though this book came out in 1992, the suggestions made in it are just as useful today as when it was first printed.
This book gets away from the “save more and spend less” teachings of many of the other personal finance books and gets in the discussions of why we spend. It reminds you to look beyond money as a means of getting stuff.
Many of the readers describe the book as life-changing with regards to financial independence and the meaning of financial freedom.
It is a great addition to those considering personal finance education for themselves because it takes personal finance beyond just debt and savings.
“Get a Financial Life” is targeted to those who are in their 20s and 30s.
The goal of the book is to help with financial decisions and getting a financial base in order so mistakes can be avoided which can be very hurtful and take years to overcome in your personal finance life.
The book discusses financial issues related to this age group such as focusing on student loans, understanding health insurance coverage and medical costs, and how to save for a home when you feel there is absolutely no way you can afford it.
For those in this age group or if you have relatives in this age group, the principles in this book are for you.
It is written for those who have gained new purchasing power usually saddled with school debt and some credit card debt while having no background to rely on for managing their personal finances.
There is much more to personal finance education than just knowing the benefits of having no debt and the importance of saving. Most of us learn little to nothing about the subject from high school much less college.
Often our parents are not good sources of information on personal finance either as many of them are in the same boat.
Just like with other areas of interest, lifelong learning and adult education must be done on your own. These books are a great start in that education process for personal finance.
This just happens to also be an area which can be applied immediately to real-life.
Personal finance is not theoretical, abstract, or never to be used again once you learn it.
It is probably the most practical subject matter you will ever educate yourself on.