The 5 Best Books to Take Hold of Your Finances in 2019
by Matt Frankel, CFP | April 25, 2019
These are five excellent ways to learn more about smart financial habits, how to invest, and how to develop a winning financial mindset.
If one of your goals for this year is to finally take control of your finances, there are some books out there that could be game-changing for you. I'm an avid reader of personal finance and investing books, and I think these five provide excellent and thorough guidance that can help get you on the right path.
There are many more great personal finance and investing books than I've listed here. However, not everyone wants (or has the time) to read dozens of books in a year, and these five offer a solid combination of personal finance strategies, mindset advice, and the foundations of a sound investment plan.
1. Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence, by Vicki Robin and Joe Dominguez
This book has been around for a quarter-century but was thoroughly updated in 2018. Many experts have referred to this as the best personal finance book ever written. It focuses on helping you develop a healthy "relationship" with money through lessons that help you rethink your spending habits, financial organization skills, and more.
2. Broke Millennial: Stop Scraping By and Get Your Financial Life Together, by Erin Lowry
This is another great "financial mindset" book, specifically geared toward the 20- and 30-something crowd. In addition to standard debt, savings, investing, and budgeting issues, Lowry dives into illuminating discussions on topics like how to tackle debt and how couples should approach financial issues.
3. The Little Book of Common-Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns, by John C. Bogle
Warren Buffett has said that if a statue is ever erected to honor someone who has done the most for everyday investors, the obvious choice is John "Jack" Bogle. Bogle, who passed away in January, was the founder of Vanguard Group and is considered to be the father of the index fund, which allows investors to passively track (i.e., match the returns of) a stock index, such as the S&P 500, at a bare minimum of expense.
In The Little Book of Common-Sense Investing, Bogle explains why index funds are the best investment choice for most investors, along with how to use them properly.
4. One Up on Wall Street, by Peter Lynch
Bogle's book is fantastic, and index fund investing is the best strategy for most people. However, if you have the time and desire to invest in individual stocks, as well as the patience to learn how to do it right, I strongly suggest starting with some of Peter Lynch's books before opening your first brokerage account.
One Up on Wall Street is my personal favorite, as Lynch explains in plain English how everyday investors like you and I can use things we already know to give us an advantage over institutional investors. Lynch's other well-known books Learn to Earn and Beating the Street also contain tons of valuable information for newer investors. In fact, if you're thinking of buying some stocks, I'd strongly suggest picking up all three titles. Doing so could be one of the best long-term investments you can make when you're just getting started.
5. The Millionaire Next Door, by Thomas J. Stanley and William D. Danko
This is one of the first personal finance books I ever read, and I'd still consider it a must-read for anyone who wants to achieve financial freedom.
In a nutshell, the book is a fantastic exploration of rich people in America, and you might be shocked at how different the "millionaire lifestyle" is from how you pictured it. If you really want to become one of the millions of American millionaires, getting into a millionaire mindset is a crucial first step, and this book is a great starting point for getting your head in the game.
If you're serious about growing your wealth, the first and most important thing you should invest in is your knowledge. Buffett, widely considered the best investor of our time, has said he spends five to six hours per day reading books, newspapers, company reports, and more. If you commit even an hour of your time to learning every day, you'll be richly rewarded in time.
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