Over the years, I’ve read dozens of personal finance books (exciting, I know). Sadly, most of the ones I’ve read have been disappointing. There are some, however, that I have found very useful and happily recommend to people asking about finance books. So buckle up and be prepared to hear my favorites.

Oh, and I’ve opened up an aStore at Amazon.com. You’ll note that I didn’t list hundreds and hundreds of books hoping you’ll see something that catches your eye and waste your hard-earned money on it. If it’s on this list it’s because I’ve read it and found it very helpful. If you like to buy the books you read, I recommend these. If money is tight or you prefer to borrow books, I recommend checking these out at the library.

Now, on to the books!

The Truth about Money 3rd Edition
By Ric Edelman

First, let’s start with the bad. I STRONGLY disagree with Ric Edelman’s views on index funds (he hates them). I think index funds are perhaps the best way for people to invest in stocks and you should disregard his hatred for them.

While his view on index funds alone is almost enough to get this book pulled from my recommendations, the rest of this book is fantastic. Edelman basically walks you through all types of investment instruments in an easy-to-understand and often humorous manner. But don’t take that the wrong way. A beginner can understand the book just fine, but there’s also excellent “high-level” advice in this book.

The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich
By David Bach

As with many financial gurus, David Bach has turned his “Automatic Millionaire” series into a franchise. And like most personal finance gurus that go this route, his best advice is in the original book and you don’t need to bother with subsequent books.

The best part about this book is that it shatters the myth that only the rich get richer. If you try to convince yourself that you don’t earn enough money to be a millionaire by the time you retire, you’re lying to yourself.

Automatic Wealth: The Six Steps to Financial Independence
By Michael Masterson

I hesitated listing this book as it’s not truly a personal finance book; however, it does touch on such issues and is full of other great advice about career development and networking.

Whereas David Bach might advocate the turtle approach (slow and steady), Masterson basically says “the hell with that.” Sure, it’ll be nice to be wealthy when you’re 65, but wouldn’t it be nicer to be rich now or at least soon? That said the books don’t really conflict as you could follow the advice of both authors simultaneously.

Perhaps the best thing about this book is that Masterson was a self-made millionaire long before this book. He’s not someone who got rich by writing books about how to get rich. (*cough* Robert Kiyosaki *cough*)

The Millionaire Next Door
By Thomas J. Stanley, William D. Danko

There’s not much practical advice in this book, but it does shatter some myths about what millionaires are like and how they got to be millionaires. It’s an orgy of statistics and perhaps a bit dry, but it’s also inspiring in that it explains very clearly that, yes, you can be a millionaire.

A Random Walk Down Wall Street: Completely Revised and Updated Eighth Edition
By Burton G. Malkiel
&
The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk
By William Bernstein

By grouping these two books together, I’m not suggesting they’re interchangeable. There is definitely some overlap in material, but both are interesting in their own way and worth a read.

There’s a lot of information about investing in these books, but if I were forced summarize these books in one sentence, it would be this: You, nor anyone else, can beat the stock market. That may be a controversial concept (you can imagine that mutual fund managers don’t care for it too much), but both authors come out with guns blazing and cite study after study that actively managed funds are hazardous to your financial health.

Bernstein also has a book called “The Four Pillars of Investing: Lessons for Building a Winning Portfolio” that I hear is excellent, but as I have not read it, I cannot offer my opinion.

The Money Book for the Young, Fabulous & Broke
By Suze “Girlfriend” Orman

There are many financial concepts I disagree with Orman on (paying off a mortgage as fast as possible, for example). You may notice that I don’t feel the need to recommend any of her earlier books, but I really think she hit a homerun with this one.

It’s really no surprise that most college students and young professionals are clueless about personal finance when most of the literature on the topic has little relevance for them. The reality is that today’s college graduates are facing different financial challenges than their parents ever did. As college costs soar to the moon, students are finishing with more and more debt than ever before. For many of these students, the idea of buying a home or getting married right after college isn’t always practical. Orman recognizes the changing financial landscape and adjusts her advice accordingly.

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So those are my favorite books at the moment. Any new books added to the store will be accompanied by a review of the book and why I like it.



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