Reading personal finance books would help broaden your knowledge about financial management, investments, savings, budgeting, and more. It will help you become better at handling money, at the same time, prosper whatever you have.
For sure, many of us, in one way or another have encountered feeling powerless with money. Some of us may have experienced bot having a budget, or have zero knowledge on building a retirement fund, emergency fund, investing, and even the simplest of all, saving.
Let’s admit it, it’s not a good feeling to be in that kind of situation. Because when the need arises, it’s hard to find money to finance for that particular need — thus, leading you to borrow money, and then eventually, becoming broke.
Financial literacy is, unfortunately, one of the major problems among people in our country.
In a report published by Forbes, it says that studies have found that 44% of Americans do not have enough cash to cover a $400 emergency. With such number, it is, honestly, devastating as this may lead to either credit card debt, or worse, homelessness.
Furthermore, in the same report, it says that 43% of student loan borrowers are not making payments, while 38% of U.S. households have credit card debt. If you come to think about it, these numbers are pretty much alarming.
In addition, it also states that 33% of American adults have $0 saved for retirement, which is not ideal at all because everyone should work on his or her retirement fund to ensure you get to continuously live a good life even after retirement.
You see, this report alone is a perfect testament that we need to work on our finances. We need to ensure that we have money set aside to cover not just our day to day needs, but also the needs that may arise in the future – which by the way, is inevitable.
Having said all that, how do we turn the tide? How do we make sure we do not commit the same mistake? How do we ensure we are not part of the 44%, 43%, 38% or 33% we mentioned earlier? The answer is – financial literacy.
We need to be literate in handling our finances. We have to learn how to handle our money and make sure it goes to the right places.
But, the question is, how?
One of the basic and most simple things to do is to read personal finance books, which you can easily find not just at the bookstores, but even online.
There are a lot of really good personal finance books that can teach you how to become responsible for handling money, and how to ensure you are ready for the future.
Having said that, we are going to share with you some of the best personal books we found – and hopefully, this helps you start off a good personal finance journey.
But before that, allow us to share with you first what personal finance is all about and the importance of personal finance management –
WHAT IS PERSONAL FINANCE?
Personal finance usually refers to the financial management of a person or a family’s resources. It basically refers to how you manage your money through expenses, savings, and investments, taking into consideration various life events as well as risks.
Apart from what we mentioned, other aspects of personal finance involve budgeting, banking, retirement, insurance, estate planning, and many more. The term, personal finance, can actually stand for the entire financial industry in a person’s life, which includes all the institutions that offer financial serviced to an individual.
When we talk about personal finance, it focuses mainly on meeting the person’s short and long-term financial goals. Whether we talk about having enough money for your monthly bills, or you want to plan for your retirement, all of these are under personal finance.
Being financially literate or knowledgeable helps an individual to distinguish between making financial decisions that are beneficial, as well as decisions that will be detrimental to the person’s financial future.
Ideally, the sooner you start to plan your finances, the better. Doing so will help ensure your assets, as well as your income and expenditure, are well-catered for.
WHY IS PERSONAL FINANCE IMPORTANT?
To be honest, and we think a lot of personal finance literates will agree that the very purpose of financial planning can never be exhaustively explained. We can give plenty of reasons, however, we opted to just focus on a few things, which include:
1. Personal finance helps you make sure that you meet your money’s needs.
So, you earned a couple of bucks today, what’s next? Are you going to spend it? Well, not necessarily.
Before you even think about spending, you should first and foremost establish how much your income is, what are your expenses, what plans do you have, and of course, what is your financial goal? By breaking everything down, this helps you think beyond just working to make money.
2. Personal finance helps you manage your income easily.
The case is — when a person does not plan his or her income, what happens is he or she ends up overspending or in some cases, spend on things that are not necessary at all.
By establishing personal finance, this helps you spend only on what is necessary, and then save or invest the rest of your money, which you can eventually use in the future when the need arises.
3. Personal finance helps you budget, spend, and save wisely.
The best attitude towards personal finance is to spend within your means. Never spend more than what you earn, or you will end up broke or living in debt, which is not ideal at all.
Having personal finance skills will help you understand how much you earn, and what your monthly expenses are, at the same time, it helps you budget within what you have. Of course, it is a process. But believe us, it is worth it. No one else will reap what you sow in the end but you, anyway.
So there you have it, we only mentioned three things, but as we mentioned earlier, there are plenty of reasons rather the importance of establishing personal finance or being financially literate.
Before we head on to the next — If you want to know more about really amazing personal finance books, check out this video blog by Marko – WhiteBoard Finance:
PERSONAL FINANCE BOOKS
Now, to help you even more with your personal finance journey, as promised, here are some of the resources – personal finance books, to be exact – that will help you start off your personal finance journey. These books are just some of the many personal finance books you will find.
Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence
Author: Vicki Robin and Joe Dominguez | Price: $15
To be honest, the title itself is quite very intriguing, right? Imagine, it’s like you are asked to choose between life or money. But it’s not really about choosing between the two, rather, the authors of the books share the idea that living in a frugal way will actually make you happier.
The book teaches you to choose intelligently. Both Robin and Dominguez established in the book that earning money should not be equivalent to misery.
When making financial choices, go with the one that makes you the happiest, and then adjust your budget accordingly.
For us, we believe that the book is not about learning how to budget, rather it is about living within your means, which is a very common problem among us, people. The book basically states that to be able to live within your means, you have to change your habits and in return, enjoy life.
Rich Dad Poor Dad
Author: Robert T. Kiyosaki | Price: $6
This one’s a very popular book not just in the country, but all over the world. It is, in fact, one of the bestselling personal finance books of all time.
Rich Dad Poor Dad is actually something that is more of a memoir that comes with bountiful of lessons. The book has been running for over 20 years already, and it continues to be widely read. In fact, it has an updated version, the latest being done in 2017.
When you read the book, it actually feels like the author is walking you through some childhood reminiscences — having a contrast between a not-so-wealthy dad, and the father of his friend who happened to be one of the richest in Hawaii. The comparison between the two shines a spotlight on how to best manage your money or the lack of it. Also, as to how to help your kids do the same.
According to the author, not all debt is bad. He also said that anyone can actually work his or her way toward wealth even if you are not earning big time. That, at the end of the day, how you handle your money and figuring out how to make it through a small paycheck is what matters.
How to Retire Happy, Wild, and Free: Retirement Wisdom That You Won’t Get from Your Financial Advisor
Author: Emie J. Zelinski | Price: $18
As the title of the book suggests, this is a book about retirement — particularly, on retiring early. Who doesn’t want to retire early, right? Most of us dream of retiring early, and enjoy life after.
Anyway, this book is not just about taming your finances to be able to prepare for retirement, but it also tackles retiring well what you have manages to save.
We find it quite interesting that the book does not promote working longer and harder to be able to achieve that.
Zelinski believes that a person does not need more than $1 million savings to be able to accomplish it. In addition, the author teaches a few lessons about how to enjoy the best years of your life on the money that you have sooner instead of doing that later.
Broke Millennial: Stop Scraping By and Get Your Financial Life Together
Author: Erin Lowry | Price: $11
We highly recommend this book to newbies in personal finance management. We thought this is one of the best personal finance books for beginners.
The books are ideal for those who are at their 20s and 30s and are most likely dealing with paying off debt, at the same time, planning for the future.
We like the fact that this book focuses on the younger generation. We believe that to have financially literate people, you have to work on the younger generations. Older people are harder to convince to change their ways, but the younger ones? There is so much room in them.
The book is basically teaching a lot of very important “basics” in personal finance, which is why it makes an ideal book or resource for the young ones or anyone who wanted to start becoming financially literate.
Smart Women Finish Rich
Author: David Bach | Price: $13
Have you ever heard the advice that says — if you simply cut buying a cup of coffee every day from your favorite coffee shop, you could actually save more than $1,000 in a year? If so, then you must be familiar already with author and financial expert Bach’s “latte factor”.
Although the title seems like it’s addressed particularly to women, the book is actually, for anyone who is looking to take control of their finances.
The book basically talks about how simple and achievable tweaks can lead to big savings, how small investments can eventually pay off later on in life, and the best of all, how to stop living on paycheck to paycheck basis.
By the way, we also find this book ideal for younger generations —, especially Bach’s latte factor.
Why Didn’t They Teach Me This in School: 99 Personal Money Management Principles to Live By
Author: Cary Siegel | $15
The author, Siegel, actually got the idea for this book when he realized how lacking schools had taught his very own kids about handling money.
The book basically brings young people to be quick but never overlook it. It encourages people to master these 99 personal money management principles — regardless of how young or old you are.
Surely, 99 can get a little overwhelming, thus, the author encapsulated them into eight broad lessons.
The book, in particular, teaches us how to manage our money so it doesn’t manage us.
The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich
Author: David Bach | Price: $11
Here’s another book from bestselling author and financial expert, David Bach.
We find the book very straightforward, at the same time, it is true to what it promises to deliver — a one-step plan.
Once you read the book, you may have an impression that you are like reading a fiction story about a couple who earns a modest income but owns two mortgage-free homes plus significant retirement savings.
From there, the author explains about a one-step process that will lead you to be like the couple — which, surprisingly, does not involve earning six figures or budgeting.
To be honest, it’s quite a very interesting book, and we highly recommend you check this out. By the way, this book sold over 1.5 million copies already. So, that is a testament to how amazing this book is.
The Total Money Makeover Classic Edition: A Proven Plan for Financial Fitness
Author: Dave Ramsey | Price: $12
For sure, you know who David Ramsey is. Reading the book is like listening to him over the radio.
Anyway, The Total Money Makeover Classic Edition: A Proven Plan for Financial Fitness includes some new ‘Dave Rants” that talks about budget-busters like how to foot the bill once your children start college, as well as marital difficulties.
If you want get-rich-quick advice, this is definitely not the book for you. This, rather, is a book that provides you with a solid foundation when it comes to saving enough money so you won’t have a problem should you encounter emergencies or anything that needs funds immediately. Needless to say, saving money so you get to retire comfortably.
As always, Ramsey has always been a believer in paying off debt so you get to achieve your financial goals.
The Millionaire Next Door: The Surprising Secrets of America’s Wealthy
Author: William D. Danko and Thomas J. Stanley | Price: $11
Business professors, William D. Danko and Thomas J. Stanley talk about the seven common traits found among millionaires in this book. After a lot of years spent on research into the wealthy, both authors have found that most of the rich people do not live in the famous Beverly Hills or are driving off fancy cars. Rather, they found out that most of the wealthy people got their wealth by working hard, living frugally, and of course, saving most of their money.
This book depicts what the media shows about wealthy people. Also, it emphasizes how to become rich without needing a high profile degree or job.
FINAL THOUGHTS ON PERSONAL FINANCE BOOKS
Yes, we have a problem when it comes to financial literacy, but that does not mean it will be like that forever, right? We can, as they say, turn the tide and become better when it comes to personal finance management.
As we have said earlier, there are plenty of ways to learn about personal finance, and one of the easiest is by reading personal finance books written by highly reputable people in personal finance.
So, have you read one yet or have yet to read? How about your personal finance status? Are you there already or getting there?