Reading books is one of the most beautiful ways to gain knowledge and explore a new way of living. So many of my readers have found their love for saving and making money through reading books. That’s even how I started my journey.
I read about 50 books a year and love learning about personal finance from various leaders in the field; David Bach, Dave Ramsey, Erin Lowry, or Ramit Sethi. They each have a different perspective on money, but all have one common goal; to help people live life on their terms and gain financial freedom.
Here’s a list of the 10 best lessons I’ve learned from the top personal finance books.
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1. Pay yourself first
I get emails all the time from readers who say they hate budgeting and can’t stick to it. I used to hate budgeting for a long time, now, I check it about once a week just to make sure I’m on track…But, is there another way to save money without budgeting? There is.
David Bach shares one of my favorite lessons in his book, The Automatic Millionaire. You don’t need a budget nor willpower to save money. In fact, you can save a lot of money and more than enough for your retirement by doing one simple thing.
To set up your financial future, all you have to do is make things automatic.
David Bach gives you everything you need to set up a realistic system for you. You learn everything you need to know about saving automatically. This is a must-read for people who hate budgeting. Instead, you learn how to set up automatic transfers from your paycheck or bank account and have them go straight to your retirement plans or savings account.
He teaches you how to pay yourself first with a totally automatic plan to secure your financial future. He shares incredible stories from real-life people who make an average household income of $55,000 a year, yet they own 2 homes, debt-free, put 2 kids through college and will retire at 55 with more than $1 million in savings.
This book is powerful. Please, for the sake of your finances, get this book. You need it. I needed it and I didn’t even know I needed it.
2. Be a conscious spender
Similar to David Bach’s budget and automation mentality, Ramit Sethi from the book I Will Teach You To Be Rich also shares how to spend wisely without actually following a strict budget. He believes in conscious spending and automating savings without sacrificing your beloved lattes.
Instead of spending your money on things you don’t truly enjoy, he recommends spending consciously and intentionally.
If your friends constantly go out to restaurants a few days a week and you don’t enjoy spending a ton of money on restaurants – don’t. It’s hard to learn how to say no to people in the beginning, but it’s your money and more importantly, your time. But this is just one example.
We often get into other situations where we spend things on whatever. We take a trip to Target and spend $200 on crap that fills our homes, yet we don’t have any money in savings.
I know I’m going to say this about every book on this list, but this book is a serious must-read. Keep in mind, the author has a unique and *out there* personality, and his reading may offend you at times. It didn’t bother me, but it might for some.
3. How to retire early
Whether you want to retire early or not, an important lesson we all need to know is that you don’t have to work forever. In fact, you can retire early.
So many of us are expected to work around the clock until we’re 70 years old. Some of us feel like we don’t even have a choice, but we do. That’s exactly what you’ll learn in Work Optional. You have control of your financial future.
Work Optional teaches you how to design your dream life while keeping in mind health care and children, protecting yourself from future recessions and unpredictable events, as well as achieving a retirement full of purpose. You learn how to live on less, spend on things you actually enjoy (maybe it’s traveling Europe or buying high-quality bikes!), and exactly how to save wisely.
Work Optional was one of my favorite reads of 2019.
4. How to become a millionaire
I always thought becoming a millionaire was out of reach. I also had no clue I was living in a country with more than 18 million millionaires.
According to this Forbes article, there are currently 18 million millionaires in the U.S. The U.S has more millionaires than any other country in the world. Being a millionaire doesn’t mean you make $1 million per year. It means your net worth is $1 million. Still, pretty dang incredible.
In the book Everyday Millionaires, you learn how ordinary people built extraordinary wealth and how you can do the exact same. If you’re willing to do the work and follow what Chris Hogan teaches in Everyday Millionaires, you too can become a millionaire.
Chris Hogan is well-known in the personal finance community for his easy-to-understand retirement advice and tips. I highly recommend reading his book. It’s a fairly quick read (I read it in about a day).
5. People spend money differently – and that’s okay
One of my favorite personal finance books out there is Refinery29’s Money Diaries. I love the real, raw look into people’s individual finances and how they spend their money on any given day.
Some people can spend a couple thousand per week, while others are living on $300 a week. Some are spending hundreds of dollars on fitness classes and others spend hundreds on restaurant outings.
The fun part about taking part in the Money Diaries series is seeing where you spend money.
And better yet, are you being intentional with your money? Do you like what you’re spending money on?
You also learn what to do if you hate budgets and what to do instead, how to repay your student loans the best way possible, and plenty of other useful tips you can apply to your life.
Honestly, even if you learn nothing from this book, it’s so much fun to get such a raw glimpse into other people’s spending habits.
6. Keep investing simple
Are you someone who has no clue about investing? Does even thinking about retirement freak you the —- out? Saaaaame for me back when I started learning about investing.
The key to learning about investing is taking it all in a little at a time, learning from different leaders in the world, and also realizing you’re not going to become an expert investor overnight (or ever – but you don’t have to be an expert to be a great investor).
The Boglehead’s Guide to Investing is a DIY approach to taking your first step into the investment world. You learn exactly how to choose a sound financial lifestyle and diversify your portfolio, why you should start investing early, regularly, and how to keep costs and taxes low.
I thought this book was going to be stuffy and filled with crazy financial jargon, but it wasn’t! It’s actually an enjoyable read.
The key to good investing is keeping things as boring as possible. I love that advice.
7. Spend money intentionally
One of the first personal finance books that I read (and seriously enjoyed!) was Love Your Life, Not Theirs by Rachel Cruze. And it goes over an incredibly important topic that most of us face.
Do you have a damaging money habit of comparing yourself to others? Do you often buy the next fancy new car or piece of technology so you can impress people around you?
In Love Your Life, Not Theirs, you learn the seven essential money habits for living the life you truly want and deserve. You ditch the keeping up with the Joneses mentality and stop comparing your life to others.
Instead, you’ll learn how to buy and do the things that are important to you without going into debt.
8. You can make more money
Do you want to make more money? Is something holding you back from making more money? What kind of doubts, fears, and excuses are running around in your brain?
You Are A Badass At Making Money teaches you how to get rid of the fears that have been holding you back financially. You’ll learn how to unlock earning potential and get incredible results in your own life.
This is an absolute must-read and you’ll definitely find yourself smiling or laughing a few times throughout the book. Such a fun read.
9. You can take control of your finances
One of my all-time favorite books to learn about personal finance is from Broke Millennial: Stop Scraping By And Get Your Financial Life Together. This book is marketed to 20 or 30 something’s, but it’s honestly a great read for any age.
A lot of personal finance books can be stuffy and loaded with jargon that you don’t understand. Broke Millennial isn’t one of those books.
Instead, you get a step-by-step plan to go from broke to financial badass. You learn how to drastically improve your relationship with money, how to manage student loans in a stress-free manner, how to work on finances with your partner, and all the other great stuff to know related to budgeting, investing, etc.
This book is a fun read and is a good book to keep on hand in your home. You can refer back to certain chapters and topics you’re struggling with and get great advice. My boyfriend and I often find ourselves diving into chapters we’ve already before, just to freshen up on.
10. Keep finances simple
Great news for you! Managing your finances can actually be incredibly simple. Money doesn’t need to be complicated.
In fact, you can learn everything from one 4″ x 6″ index card.
University of Chicago professor Harold Pollack interviewed Helaine Olen and asked him to put everything we need to know about managing our finances onto an index card. He put down all the rules on a card and posted it online, and it went viral.
Pollack and Olen decided to team up and explain why the ten simple rules on the index card are all you need in the book The Index Card. You learn exactly how to follow their advice and keep your finances simple and easy to manage.
I highly recommend reading all 10 of these books this year. You have the ability and control to create so much change in your life. If you find it hard to find time to read, fit in 30 minutes at night when you’re laying in bed to read. If you seriously have no time at all, you can listen to these books on audiobooks while in your car or on a train to work.
Dedicate time to learn about personal finance via books. You’re worth it.
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What’s your favorite lesson you’ve learned from a personal finance book?
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