Five years from today, you will be the same person that you are today, except for the books you read and the people you meet.
– Charlie “Tremendous” Jones
If you want to change your financial life, the best thing you can do is educate yourself about personal finance.
The easiest way to do this is by reading personal finance books. Without question I have changed my financial life from reading personal finance books.
And these 5 gems below are must-read personal finance books.
1. The Money Book for the Young Fabulous and Broke By Suze Orman
This book is specifically written for young adults. It has everything you need to start your personal finance journey. I really liked reading this book because it taught me about “money basics” – everything from budgeting, building an emergency fund, and buying a car. It’s all in there in a way that’s easy to read and understand. You will learn a lot about personal finance from this book – the “dos and don’ts” are all covered.
2. The Total Money Makeover by Dave Ramsey
This book provides a specific plan for you to get out of debt and build wealth (the good old fashioned way). If you don’t know where to start and you feel overwhelmed, then this is a great resource. If you have debt, this book is a really good place to start because it forces you to rethink your debt and your entire financial plan. If you want a specific plan to help you feel in control of your debt, then you can’t go wrong with this book.
3. I Will Teach You to Be Rich by Ramit Sethi
This book covers everything you need to know about the “big picture” of creating a financial plan. It explains investing, getting out of debt, and building wealth. While not specifically targeted toward young people, I think it reads as if it is meant for young people. It’s very easy to read yet full of really valuable content. This book has greatly affected how I think about money, how I spend money, and why I’m motivated to make more money. This book is more of a “forest” book than a “trees” book – you should read it for an overview of everything. Afterwards, you may even feel like personal finance isn’t so complicated after all.
4. Your Money or Your Life By Joe Dominguez and Vicki Robin
This book focuses on the deeper issues of personal finance. It focuses on matching your personal values with your financial choices. It does not focus on building wealth, like other personal finance books. Instead, this book focuses on helping you figure out what you want in life and aligning your money with that direction. This book will help you reconsider how you spend your money every day.
5. The Millionaire Next Door By Thomas Stanley and William Danko
If you like evidence and reports, this book is great because it shows you exactly how the wealthy upper middle class got there – with all the facts to back it up. It’s not boring or dry, though, so don’t be turned off if you don’t love statistics. It truly shows you, with evidence, how you can become wealthy and how people all around you (people who you wouldn’t expect) are wealthy. It’s a classic!
One book that I want to mention is Rich Dad Poor Dad by Robert Kiyosaki. It’s not going to teach you how to manage your money but it will tech you how to think about money differently.
By starting with one book, you’ll figure out what you need to learn more about and then can choose your next book after that. Whatever you do, keep reading! (For more book recommendations, visit my Recommended Books Page.)