It took a lot of reading for me to gain enough knowledge to feel comfortable about handling my own finances. In doing so, I realized it really isn’t all that complicated once you break through your own beliefs .
I have condensed my personal reading list down to the top 20 books that helped change my mindset and behaviors and put me on a path to financial independence. The list contains books that will inspire, motivate, offer practical tips on savings, budgeting, paying debt, preparing for retirement, and many other areas of personal finance. I hope some of these books will motivate you to action the way they have for me.
I have broken the list down into 5 categories. While almost every book will cover topics from each category to some extent, the books have been placed in the category they are most relevant overall. For your convenience, I have also included links for you to follow should you wish to purchase the book in hard copy, e-book, or audio book where available. These are affiliate links so if you choose to use them I will be paid a small commission which helps the site. See full Affiliate disclosure here. If not, that is ok too.
Inspiration
The first category I have chosen are mostly meant to inspire you to action. These books contain valuable practical information as well however, more then anything, they inspired me to get off my butt and do something
#1 Unshakeable: Your Financial Freedom Playbook by Tony Robbins
Print | E-Book | Audio Book
Number one with a bullet is Unshakeable by Tony Robbins. You would need to be living under a rock to have never heard of Tony Robbins. Business consultant, self help guru, best selling author, philanthropist, his list of accolades is a long one.
I am a huge fan of everything he has done and when it comes to financial education, his book Unshakeable is yet another home run.
In Unshakeable, Robbins gives you his blue print on how to win inan ever fluctuating market. Written in layman’s terms for the everyday person, this book is packed with tips, motivation and knowledge. Robbins has written Unshakeable based on his interactions with the worlds most successful investors. He freely admits that there are not any get rich quick schemes here. He knows the stock market is unpredictable and writes in a way that people who feel intimidated by the market can calm down and take a more rational approach.
That is the #1 takeaway from this book. Mindset. By the time I finished reading Unshakeable I had changed my mindset to one of not only can I understand this stuff on a theoretical level, I can understand it on a practical level and go out into the real world with this knowledge.
Unshakeable is the book which led me down the rabithole to gaining a better understanding of compound interest, dollar cost averaging, and simple overall market performance over time. In Unshakeable, Robbins manages to take a scary, overwhelming topic and break it down into digestible easy to understand portions. Upon completion of reading it, my fears subsided and I was able to take control of my financial well being.
Unshakeable by Tony Robbins gets my highest recommendation.
#2 Rich Dad, Poor Dad by Robert Kiyosaki
Print | E-Book | Audio Book
Since its first printing over 20 years ago, Robert Kiyosaki’s Rich Dad, Poor Dad has become a landmark in the personal finance world and has sold over 40 million copies.
I first read this book in my 20’s and at the time I saw it as just another book about becoming an entrepreneur in the real estate market. Multiple readings later and I now realize it is so much more.
Similar to Unshakeable, Rich Dad, Poor Dad is about changing your mindset. Key takeaways from this book which helped change my mindset were as follows:
- The rich do not trade time for money
- The rich find ways to make money work for them
- Taxes will destroy your wealth if you let them
- You must be responsible for your own financial literacy
When it comes to changing my own mindset I can think of no 2 books then the first 2 on this list that have had a bigger influence on me. Rich Dad in particular taught me to understand that I must educate myself and take control of my own financial destiny if I was going to become truly financially independent.
#3 The Millionaire Next Door: The Surprising Secrets of Americas Wealthy by Thomas J Stanley
Print | E-Book | Audio Book
The Millionaire Next Door will break down your perception of what a millionaire is. The author did extensive research on people whose net worth defined them as a millionaire and what he discovered will surprise most. The typical millionaire is not your suit wearing, briefcase carrying, fancy car driving big shot as you might imagine. They are not celebrities or inheritance babies.
On the contrary, the typical millionaire lives a very simple lifestyle. Using the data created while performing his research, the author breaks down the typical characteristics of a millionaire into 7 traits.
- They live well below their means.
- The allocate their time and energy efficiently towards building wealth.
- They believe financial independence is more important than displaying their social status.
- Their parents did not provide economic out patient care.
- Their adult children are economically self sufficient.
- They are proficient in targeting market opportunites.
- The chose the right occupations.
The author, Thomas Stanley, goes on to outline each of these 7 traits in their own chapter. If Unshakeable helped me to understand what is possible, and Rich Dad made me realize I am responsible for me, The Millionaire Next Door helped me to realize I could actually do this. For the first time I thought to myself, not only is it possible to become a millionaire, it is possible for me.
And it is possible for you too.
#4 Your Money or Your Life by Vicki Robin
Print | E-Book | Audio Book
The final Book on my inspirational list is Your Money or Your Life by Vicki Robin. This book inspired me to view my job differently and in turn make a better life for myself. Before I read Your Money, I was working to earn money to live. What this book taught me was to not accept the rat race of working to live but instead live the life you choose.
The book is not so much a step by step on how to increase your wealth but rather inspiration to redefine your understanding of what true wealth is. The 9 step program will have you re-evaluating every dollar you have ever made, how you have spent your time and how you can do it better going forward.
The effect this book had on me was to redefine what it means to be wealthy. Wealthy to me used to mean having unlimited funds to buy whatever I wanted whenever I want. The financial benchmark that came along with my definition of wealth was somewhat unattainable. Because of my beliefs I would never reach my goal and therefore never feel truly satisfied.
I now define true wealth as simply having the financial independence to decide how I will spend my time. Not to have to report to a job that is not fulfilling just to earn the money required to reach a certain benchmark of defined wealth. The true measure of wealth for me is the ability to travel through life unencumbered by obligation. That is true wealth. The ability to determine the use of the most valuable and only truly irreplaceable commodity, time.
Basic Finance Tips – Budgeting & Savings
The next category id full of books that will help by teaching you basic financial literacy. This will include budgeting, saving, and getting out of debt ad well as general tips on controlling your finances.
#5 Personal Finance for Dummies by Eric Tyson
Print | E-Book | Audio Book
Personal Finance for Dummies is about as basic as it gets when it comes to books on financial education. Think of it as a beginners guide or a personal finance encyclopedia or reference guide. Much of it may sound elementary, but it is a great book not just for beginners but intermediate and experts as well. I always find it helpful to revisit concepts I may have studied years ago. I use this book for reference as needed.
Personal Finance for Dummies makes it about as simple as possible to understand personal finance concepts and build a foundation of knowledge.
#6 The Index Card: Why Personal Finance Doesn’t Have To Be Complicated by Harold Pollack and Helaine Olen
Print | E-Book | Audio Book
The Index Card boils down financial advice to 9 easy to follow tips. The main purpose of the book as stated by the authors is to give readers the confidence to make their own financial decisions. The book reads super easy and you will fly through its 210 pages in no time.
The Index Card is packed with tips and advice for those people looking to simplify their investing. The book explains for example how low fee index funds typically out perform many more complicated investment options.
If you are ready to take control of your finances, The Index Card is a great place to start.
#7 Why Didn’t They Teach Me This in School? 99 Personal Money Management Principles to Live by by Cary Siegel
Print | E-Book | Audio Book
Why didn’t they teach me that in school covers a wide range of personal finance topics including budgeting, spending, investing, insurance, credit cards, and mortgages just to name a few. It is chock full of tips and advice that has practical, real world use.
This book served as a huge eye opener for me of just how ignorant I really was and how poorly the school system prepares us for the real world. Several of the tips in this book are covered at length here at EarlyRetirementEarl.com. Some overlapping themes we have in common are:
- Investing enough in your 401k to receive the company match
- Pay off highest interest credit card debt first
- Debt is bad
One great tip this book offers that I wish I knew sooner ; tip #62. Do not pay your landlord the last months rent as they will most likely refuse to return your security deposit anyway. This is an example of the real life advice offered by this book that you did not learn in school.
As my children get to their teenage years, Why didn’t they teach me this in school will be required reading. And again after they graduate high school and head out into the real world.
#8 The Automatic Millionaire: A Powerful One Step Plan to Live and Finish Rich by David Bach
Print | E-Book | Audio Book
I can simplify the lessons of this book in one sentence. Always pay yourself first using automated contributing and allow the account to grow exponential over time through the magic of compound interest.
This is quite possibly the most simplified plan to achieve financial independence. It is really all you need because it works. I have written numerous articles on this website about this very topic. The power of compound interest can not be over stated. It is a simple concept and one that anyone can understand and take advantage of. Most people don’t because they have never learned about it or don’t realize just how simple this is. In either case, The Automatic Millionaire will resolve that.
#9 The Richest Man in Babylon by George S Clayton
Print | E-Book | Audio Book
The Richest Man in Babylon has sold more than 2 million copies. First written in 1926, it is considered a timeless classic. The book teaches 7 basic principles of finances.
- Save at least 10% of all earnings
- Learn to live within your means
- Invest in safe investments that earn compound interest.
- Invest only in areas you understand.
- Buy your house – Do not rent
- Have affordable, realistic insurance.
- Always keep improving your skills and work to increase your income.
These principles may seem simple but Clayton teaches them by telling stories from back in Babylonian times. The Richest Man in Babylon will not only educate but entertain. This book is an absolute must read for anyone with even a passing interest in personal finance.
#10 What Your Financial Advisor Isn’t Telling You: The 10 Essential Truths You Need to Know About Your Money by Liz Davidson
Print | E-Book | Audio Book
Davidson’s What your financial advisor isn’t telling you is an essential read for anyone looking to have a better understanding and more self control over their finances. Weather you are planning to do it yourself or hire an adviser to do it for you, you will need to have a certain level of understanding of what it takes to manage your own money. It is after all your money and your responsibility.
Pensions are disappearing, Social Security is underfunded and market instability is intimidating for most people to even consider getting involved. It has never been more important to educate yourself about your money. Do you even know how to find an adviser or what questions to ask when you do? Do you know what fees you can expect to pay? What are your investment choices? Davidson helps to answer all of these questions and much more. Everything from debt reduction to retirement planning is covered here
Budgeting and Saving
The next category of books will focus primarily on budgeting and saving. These books offer less in the way of motivation or philosophy and are more practical. These are books I feel will benefit you if you are searching for specific information and guidance on these topics.
#11 Broke Millennial: Stop Scraping by and Get Your Financial Life Together by Erin Lowry
Print | E-Book | Audio Book
I remember when I was in my 20’s and 30’s. I had no idea where to start when it came to my financial future and the thought of trying to figure it out was being at the bottom of a mountain with no equipment and trying to reach the summit.
Broke Millennial is the book I wish I had as a 20 year old. If you are a millennial and you don’t know where to start, I suggest here.
Broke Millennial is written in a way that is empathetic to, you guessed it, millennials. They will find the shared experiences and language used make this an easy read.
The crux of the book is getting readers to understand their relationship with money. The author challenges the reader to define what your savings and spending habits are and helps to understand what is necessary to change.
Specific topics covered in depth include debt to income ration, emergency savings, your credit score and what it means, net worth and more. Broke Millennial is an excellent learning tool for someone early in their education of personal finance.
#12 The Money Saving Mom’s Budget Slash Your Spending, Pay Down Your Debt, Streamline Your Life, and Save Thousands a Year by Crystal Paine
Print | E-Book | Audio Book
The title here says it all. Author Crystal Paine, who herself is a mom, teaches you how to take control and make every dollar count. The bool covers 4 main topics
- Goal Setting
- De-cluttering
- Budgeting
- Slashing Spending
It is in the area of budgeting where I feel this book really shines. Having experience making due on modest means, Paine goes to great lengths to share her experiences in the area of making the most of each dollar. She goes as far as to help readers understand how to save money on groceries.
Overall the book is a great resource to those who might be struggling to manage their money more effectively and have the goal of living a more frugal lifestyle.
#13 Total Money Makeover: A Proven Plan for Financial Fitness by Dave Ramsey
Print | E-Book | Audio Book
Dave Ramsey is famous for helping people to revamp their spending habits and eradicate debt from their lives. In Total Money Makeover, Ramsey lays out his proven plan for financial success. His motto, “live like no one else today so you can live like no one else tomorrow'”
Ramsey’s proven plan involves a systematic approach to eliminating debt, building up an emergency fund, and building up savings. Weather you agree with certain aspects of his plan or not, one must admit that his approach is effective and his track record speaks for itself.
Total Money Makeover gives the reader the knowledge to put them on the right path. What they do with that knowledge is up to them.
If you are currently in debt, I recommend Ramsey’s Total Money Makeover. You will never be able to achieve Financial Independence if you continue to allow debt to run your life and Ramsey is an expert in the area of debt reduction.
Investing
You will never become rich by savings alone. You will need to invest the money you save in investments that grow steadily over time. Weather you plan to stick to simple index funds or you hope to become the next Warren Buffet you will need to have a good general understanding of stock market fundamentals. The following is a list of books that will help you achieve that.
#14 A Random Walk Down Wall Street by Burton G Malkiel
Print | E-Book | Audio Book
The title, A Random Walk Down Wall Street, refers to the randomness of short term market moves. The author warns about irrational exhuberance and reviews several financial bubbles throughout history such as the dotcom bubble for example. Malkiel uses this and several other examples as a cautionary tale not to get caught up in the hype.
Conversely, Malkiel theorizes that charts and technical analysis is lacking in the short term. The central theme of the book is that markets will almost always return to the pre-crash levels and that the long term trend is upwards.
Malkiel also shows you how to analyze potential returns for not only stocks and bonds but money market accounts, real estate and a full range of other investment opportunities including physical assets such as gold.
A Random Walk Down Wall Street will add to your current understanding of the stock market. It is an effective guide for all ages and knowledge level.
#15 Random Walk Guide to Investing: 10 Rules for Financial Success by Burton G Malkiel
It may seem like a cheat to include this book, and directly after A Random Walk no less, but they really are two very different books.
A Random Walk Guide is much more practical and concise than its predecessor and it take the mystery out of personal finance. The book outlines Malkiel’s own 10 point plan for success.
- Time is money. Start Saving Now.
- Regular savings is the only sure way to wealth
- Establish cash reserves and Insurance
- Stiff the tax collector
- Properly allocate your assets to match your personality
- Diversify
- Pay yourself – lower your costs
- Respect the market
- Back proven winners – Index Funds
- Avoid stupid investor tricks
Each rule comes with deeper explanation of how to apply in real world situations to help you to become a successful investor. In both Random Walk and the Random Walk Guide Malkiel has created a one two punch worthy of the recognition as the top books on our investing list.
#16 The Little Book of Common Sense Investing The Only Way to Guarantee Your Fair Share of Stock Market Returns by John C Bogle
Print | E-Book | Audio Book
This small book is divided into 18 easily digestible 20 page chapters. The main points of the book are that fees are bad, it is impossible to predict the market, taxes will ruin you, and you must not be emotional when investing.
The conclusion Bogle draws, as the title of the book suggests, is that there is only one strategy worth following; Index Funds.
If you were hoping for the secret sauce of timing the market on individual stocks, sorry to disappoint. What this book boils down to is about as basic as it gets. Stick to what works and what works are index funds. If you are looking for a low risk strategy and have the patience to see it through then Bogle’s Common Sense is the book for you.
#17 The Intelligent Investor by Benjamin Graham
Print | E-Book | Audio Book
Benjamin Graham wrote The Intelligent Investor in 1949. While some of the stocks he wrote about seem dated today, the books underlying foundation of investing insights still hold true. There are 6 key principles uitlined in the book.
- Know the business you are investing in
- Know who runs the business
- Invest for profits long term
- Choose companies based in their fundamentals not their current popularity
- Always understand and minimize your risk
- Have confidence in your analysis of the company
An intelligent investor only invests in a company they have researched, understand and feel confident about for long term profits. An intelligent investor does not worry about what others say about a company and they do not participate in irrational exuberance.
Perhaps the most important contribution this book makes is to distinguish
between investors and speculators. Speculators are looking to time the market while investors are doing the boring research and analysis. Investors are patient and have a long term plan. The bottom line is that you must make your own investment decisions based on doing the hard work. This book will help make that work a little easier by giving you the tools to do the analysis.
Retirement Planning
The final category for my 20 life changing personal finance books is retirement planning. If you are like most people working today, you are not doing your dream job and are looking for the exit. Why else would you be here reading about personal finance and early retirement?
Retirement is the ultimate goal, the finish line if you will. The reason you are doing all the financial planning and execution. So without further ado, here are the final books on my list.
*caveat* I am a firm believer in the 4% rule. You can read all about it here. I do however understand that there is more than one way to skin a cat and there are different perspectives on the subject of retirement funding. These are books I recommend not based only on my own personal choices but on what I can objectively understand someone else might prefer. I may not have ever arrived at my own beliefs on certain strategies had I not researched all of the possibilities. The list of books I present I believe have value as a learning tool regardless of weather I believe they represent the BEST course of action for me. *end caveat*
#18 How to Retire With Enough Money and How to Know What Enough Is by Teresa Ghilarducci
How to Retire with Enough Money is a concise overview of what you can expect to need in retirement. At a breezy 116 pages, this book will quickly open your eyes as to what you will need saved (8-10 times your current salary) and delivers basic principles for portfolio growth. It also includes many ideas for controlling expenses and downsizing in retirement.
How to Retire is a great starting point if you are not sure where to begin learning about your financial needs in retirement.
#19 The 5 Years Before You Retire: Retirement Planning When You Need it the Most by Emily Guy Birken
If you hope to retire in the next 5 years, you will need to accelerate your planning now. Far too many people wait until it is too late to begin planning for retirement. Leaving the work force forever is a life changing event that will require proper planning to avoid pitfalls that can cause anxiety, and even financial loss. The closer you get to that day, the more crucial planning becomes.
The 5 Years Before You retire will help guide you through some of the difficult decisions that will need to be made some of which you may not even be aware you need to make. A must read for everyone regardless of how close to retirement you may think you are. It is never to early to plan for the most important event of your life.
# 20 EarlyRetirementEarl.com
I know, this is the ultimate cheat and cheap plug and it is not even a book. But I feel with the amount of information here at this website being focused on retirement planning, I figured, why not include it.
At EarlyRetirementEarl.com Earl Owens delivers a website chock full of useful information for anyone hoping to retire at any age. He offers a perspective like no other and keeps an open mind as to your goals and plans. There is a very practical and scientific approach to most of his strategies while at the same time he is capable of writing philosophically.
Please take some time to explore the articles within and hopefully you can find them useful in your own financial planning.
Well, there you have it. I hope you will find some of these books as helpful in your financial education as I did.
Thanks for reading
Earl