Top 5 Personal Finance Books That You Need To Read

Got money on your mind? These books can help you make the most out of your investments!

When it comes to financing and budgeting, most of us have to learn everything by ourselves. From figuring out the right kind of investments to learning how to manage your spending habits, we all need to know more about handling our personal finances.

Personal finance books can help you confidently manage your money and make decisions that will positively affect your financial health in the long run. Sure, there is financial information scattered across the internet, but these books can give you credible insights into banking, retirement funds and a whole lot more! If increasing your financial knowledge is your resolution for 2022, here are some books that should be on your to-read list.

The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness

The Psychology of Money
Image courtesy of The Psychology of Money’s Amazon listing

If you are active on #Bookstagram or on the book reviewer side of YouTube, chances are you have already heard of this book. Written by Morgan Housel, The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness is focused on advising you on how to make the right investment decisions to gain financial freedom.

Housel has worked as a financial columnist for The Motley Fool and The Wall Street Journal, and he uses his knowledge of the financial markets to help you tailor your investment portfolio to fit your financial goals and prepare for financial disasters. The book conveys all of this through short stories and overall is slightly more than 200 pages long. It is a great basic guide on building your investment portfolio.

The Millionaire Next Door: The Surprising Secrets of America’s Wealthy

The Millionaire Next Door
Image courtesy of The Millionaire Next Door’s Amazon listing

Authored by Thomas J. Stanley and William D. Danko The Millionaire Next Door: The Surprising Secrets of America’s Wealthy discusses the similarities between those that have successfully been able to build fortunes. Stanley and Danko are American finance professors who have studied 14 years (1982-1996) worth of data about America’s rich population. With extensive research, the book highlights the importance of living within one’s means and investing more than spending on luxuries. It helps you think clearly about the opportunity costs of spending on consumer goods and thus teaches you to make choices that are better for your wallet. At 273 pages, the book is a good read for the shopaholics out there who need some help reigning in their expenditures.

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!

Rich Dad Poor Dad
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Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! by the American businessman and investor Robert Kiyosaki is a guide on how you can become richer. Kiyosaki compares his own father, a teacher who struggles financially, and his friend’s father, who is a high school dropout but has been able to become wealthy in spite of that. The book talks about the importance of creating passive income sources instead of doing a typical nine-to-five job. Kiyosaki explains financial concepts, like assets and liabilities, in a simple manner by giving examples from the lives of the two dads. It is a great choice for anyone who needs to understand the basics of personal finance. The book is 283 pages long and is a perfect read for those starting their financial literacy journey.

The Intelligent Investor

The Intelligent Investor
Image courtesy of The Intelligent Investor’s Amazon listing

The Intelligent Investor by the American economist Benjamin Graham is a book focused on teaching you about value investing — purchasing stocks that are trading for less than what they are worth. This strategy of investing was also followed by Warren Buffett, who is one of the most successful investors of the 20th century. Buffett calls The Intelligent Investor “By far the best book on investing ever written”.

The book divides its investment advice into two categories: one for the defensive investor (who can only spare a limited amount of time on investing) and the other for the active investor (who can spend time on studying the financial market). The book is 640 pages long and is best suited to those who already have an elementary understanding of finance and need to upgrade their portfolio management skills.

Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence

Your Money or Your Life
Image courtesy of Your Money or Your Life’s Amazon listing

Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence gives you actionable steps on how you can get started on your path to financial freedom. Written by Vicki Robin, it covers everything — from what you need to be satisfied and build a higher net worth to learning how to save money. The book helps you identify whether you get a sense of fulfillment from them by questioning your expenses and how much of your time and life energy they consume. While this book is on the slightly longer side for being at over 300 pages, it is a great pick for anyone hoping to get started on budgeting or creating a retirement plan.

Across the world, only one-third of adults understand basic financial concepts. Books, like the ones we have mentioned, make financial knowledge more accessible and help budding entrepreneurs build the financial foundation they need to lead successful businesses. Hopefully one of the books on our list piqued your interest, happy reading!

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