Financial independence is a desire that governs most of what goes on in our lives. It’s right up there with healthy eating, exercising, and watching our habits. Personal finance books will help you hone the right thinking about financial management.
There are many books about money, but here is a review of the best four. At their core, they present personal finance lessons that could change your life and reach financial stability.
The Psychology of Money, Morgan Housel
Morgan Housel tries to rewire our idea of financial success and the happiness associated with it. The core of his message is that you don’t acquire wealth as of what you know but rather as a result of how you behave.
It would be perfect if you strictly modeled our financial decisions on sensible data, but in reality, we are not wired that way.
We often make financial decisions at dinner tables, in meeting rooms, or on the train ride home. We do so in the face of persuasive marketing, pride, ego, our complicated histories, as well as an odd set of incentives that govern our lives.
Morgan Housel uses nineteen relatable stories to demonstrate how we can be smarter with our money. He writes about core issues such as leveraging the power of compounding over time, embracing volatility as a fee for investing, and how to avoid losing money by diversifying our investments.
I Will Teach You to Be Rich, Ramit Sethi
Here’s every young person’s conundrum: how do you grow your money while still living a decent life as you enjoy yourself in the here and now?
Ramit Sethi tries to answer this. His core idea is that living a financially successful life is not just about stacking dollars and cents, it’s about making choices based on what you value the most.
The author offers a logical, step-by-step way for people to build wealth in their twenties. He lays down a 6-week, no-BS program with guides on how to:
- Pay off your student loan debt faster than your thought.
- Automate your finances such that your money goes where exactly you want it to.
- Talk your way out of late fees.
He also writes about taking care of expenses like paying for a wedding, having kids, and buying a car or a house.
Your Money or Your Life
“This is a wonderful book. It can change your life.” – Oprah.
This book might just shake the foundations of your life. It has a spiritual component, and most people who have read it tend to stick to its lessons for years to come.
It also offers very simple explanations of concrete ways to observe our connections to the material world. Such as, an item worth $100 is worth more to a person who earns $50 a week, than someone who earns $1000 a week.
Oprah wasn’t false advertising. The authors present a nine-step program that will work if you commit to it. They intend to help you unify your life such that, if you follow what is written here, money will cease to be an issue in your life, and you’ll have the intellectual and emotional space to take on greater things.
A Simple Path to Wealth
This one was written for those who want to retire early. The first principles in A Simple Path to Wealth were written on Jim Collin’s blog, meant as practical advice from the author to his daughter.
It takes on a light and casual tone, but it also covers complex topics with refreshing clarity. This book is perfect for beginners, as well as investors who are tired of looking for short-term investment miracles.
