Saturday, January 16, 2021

The 14 Best Finance Books

In 2018, a study found that 58% of Americans have less than $1,000 in savings in the bank. It gets worse: Over half of those people don’t just have less than $1,000 but $0! That’s bad.

It’s not bad because “you should save money,” but because having no emergency fund puts you in a vulnerable position. What if someone crashes into your car? What if you break a few bones? Things outside of our control can force us to pay up. You don’t want to come up short when that happens.

That’s just the most pressing example of why you should learn to manage your finances. There are others: Retiring in peace without stressing about money, having enough to invest in a new venture, giving freely to friends, family, and charity — money does make our lives easier up to a certain degree.

Thankfully, there are a lot of good books to help us become financially smart. At Four Minute Books, we’ve reviewed and summarized over 700 books to date, and we think the best finance books come down to three things:

  1. Practical advice. Money is a tangible thing, so whatever tips authors give should be easy to implement for you right away.
  2. Relevant information. Depending on your situation and goals, you might need a beginner’s book or a more advanced one.
  3. Inspiring stories. If a book is boring, it won’t motivate you to take action. The easiest way to change is to listen to a good story.

Based on these three criteria, we’ve selected the 14 best finance books for you to read. If you want to become savvy with your finances, be smarter in how you spend and save, and learn to invest your money to build freedom, consider these books.

Our list includes our favorite quote, a short summary, three key lessons, and few arguments for why you may want to read each book in question. You can use the clickable table of contents below to jump to any book or category.

Table of ContentsOverall1. Rich Dad Poor Dad by Robert T. Kiyosaki   
2. Money: Master The Game by Tony RobbinsFor Beginners3. The Barefoot Investor by Scott Pape
4. The One-Page Financial Plan by Carl RichardsFor Investors5. The Intelligent Investor by Benjamin Graham
6. The Little Book That Beats The Market by Joel GreenblattFor Entrepreneurs7. The Millionaire Fastlane by MJ DeMarco
8. Think and Grow Rich by Napoleon HillFor Saving Money9. I Will Teach You To Be Rich by Ramit Sethi
10. The Total Money Makeover by Dave RamseyFor Retirement11. The Automatic Millionaire by David Bach
12. The Millionaire Next Door by Thomas J. StanleyFor Financial Freedom13. Secrets Of The Millionaire Mind by T. Harv Eker
14. The Richest Man In Babylon by George Clason

1. Rich Dad Poor Dad by Robert T. Kiyosaki

“The main reason that over 90 percent of the American public struggles financially is because they play not to lose.

They don’t play to win.”

— Robert T. Kiyosaki

The Book in One Sentence

Rich Dad Poor Dad tells the story of a boy with two fathers, one rich, one poor, to help you develop the mindset and financial knowledge you need to build a life of wealth and freedom.

Key Takeaways

  1. Use your money to acquire assets, not liabilities.
  2. Manage risks instead of avoiding them.
  3. Work to learn, not to earn.

Why should you read it?

This book is controversial, but in getting you to actually do something, it just works. It’s based partially on Kiyosaki’s life, who learned two different ways of handling money from his dad and that of his best friend. The lessons are a mix of how to approach money as a concept, basic knowledge of accounting, budgeting, and investing, and how to manage your money so it works for you. By the time you’re done with the story, you’ll enjoy implementing the tips.

2. Money: Master The Game by Tony Robbins

“You either master money, or, on some level, money masters you!”

— Tony Robbins

The Book in One Sentence

Money: Master The Game lines out seven simple steps to financial freedom, based on the advice of the world’s best billionaire investors, interviewed by Tony Robbins.

Key Takeaways

  1. Never underestimate the exponential power of compounding interest.
  2. Pick one of three financial goals to show yourself that financial freedom is within reach: basic expenses, basic + fun, or financial independence.
  3. Diversify your investments by using a 3-bucket system: A security bucket, a growth bucket, and a dream bucket.

Why should you read it?

Tony Robbins dedicated ten years of research to this book. After the financial crisis of 2008, he decided to help average people secure a good future. After interviewing several billionaire financial legends, such as Ray DalioWarren BuffettJack Bogle, he put together their best strategies. The book contains everything from mindset changes to saving tips to asset allocation. The transcripts of the interviews are worth the price of the book alone.

For Beginners

3. The Barefoot Investor by Scott Pape

“You can continue living in the past, beating yourself up about the money mistakes you made when you were younger, telling yourself you’ve left it too late…or you can rise up and make yourself proud.”

— Scott Pape

The Book in One Sentence

The Barefoot Investor is an Australian farm boy’s no-BS guide to taking charge of your personal finances with a simple system to eliminate debt, live in the now, and still retire in peace.

Key Takeaways

  1. Simplify your money management by using different bank accounts.
  2. Shred your credit cards first, then start paying off your debt.
  3. Automate some of your retirement planning with index funds.

Why should you read it?

Scott Pape is Australia’s most trusted personal finance expert. His book has sold over 1,000,000 copies. Despite growing up on a farm, Pape wanted to get rich by trading stocks. That didn’t work out. He went back to his farm and now uses the simple life as a metaphor for managing your money. The book helps you take control in three phases: plant, grow, then harvest your money. He balances easy tips with radical advice. A great book for beginners.

4. The One-Page Financial Plan by Carl Richards

“People who understand interest earn it. People who don’t pay it.”

— Carl Richards

The Book in One Sentence

The One-Page Financial Plan makes financial planning stop feeling like a burden for the less disciplined by helping you plan your entire financial future on a single page.

Key Takeaways

  1. Set some goals but stay flexible and fine-tune along the way.
  2. Turn budgeting into a game to make saving fun.
  3. View paying off debt as an investment in your future.

Why should you read it?

Carl Richards has spent more than 40,000 hours over the last 20 years as a financial advisor, working at Wells Fargo, Merrill Lynch and others. Some of his sketches he shares on Instagram went viral. They illustrate the ideas that helped him and his wife plan their finances on just one piece of paper. His book shows you how to do the same.

For Investors

5. The Intelligent Investor by Benjamin Graham

“Those who do not remember the past are condemned to repeat it.”

— Benjamin Graham

The Book in One Sentence

The Intelligent Investor explains value investing, which is focused on generating steady, long-term profits by ignoring the current market and picking companies with high intrinsic value.

Key Takeaways

  1. There are 3 principles to intelligent investing: analyze for the long term, protect yourself from losses, and don’t go for crazy profits.
  2. Never trust Mr. Market, he can be very irrational in the short and medium term.
  3. Stick to a strict formula by which you make all your investments, and you’ll do fine.

Why should you read it?

Warren Buffett says this is the single greatest book on investing ever written. It’s based on Benjamin Graham’s classes, which Warren Buffett took as a young student. Value investors find companies with great fundamentals and buy their shares at a discounted price. After that, all they have to do is wait. Eventually, their real value will unlock. A true, timeless classic.

6. The Little Book That Beats The Market by Joel Greenblatt

“Choosing individual stocks without any idea of what you’re looking for is like running through a dynamite factory with a burning match. You may live, but you’re still an idiot.”

— Joel Greenblatt

The Book in One Sentence

The Little Book That (Still) Beats The Market is a step-by-step tutorial to implement a simple, mathematical formula when buying stocks which guarantees long-term profits.

Key Takeaways

  1. Look at earnings yield and return on capital to evaluate stocks.
  2. Rank and combine these two factors to find winning companies.
  3. Be patient, it’s what makes this formula unpopular, but effective.

Why should you read it?

Joel Greenblatt is an investing legend. His investment company Gotham Funds had an annual return of over 40% for 20 years, from 1986 to 2006. With his simple formula, Joel has managed to turn Benjamin Graham’s value investing approach into a system that only needs to be updated once a year. In 2005, he wrote it down to pass it on to his children. If you’re looking for a specific, low-hassle investment approach, this is your best bet.

For Entrepreneurs

7. The Millionaire Fastlane by MJ DeMarco

“Many people want to change their life, but they are not willing to change their choices, and ultimately this changes nothing.”

— MJ DeMarco

The Book in One Sentence

The Millionaire Fastlane points out what’s wrong with the old “get a degree, get a job, work hard, retire rich” model, defines wealth in a new way, and shows you the path to retiring young.

Key Takeaways

  1. Wealth stands for 3 things — and money isn’t one of them: health, relationships, and freedom are what truly matters.
  2. At some point, you must make your income independent of your time.
  3. Think like a producer, not like a consumer.

Why should you read it?

This book must have the world’s most misleading title. It’s not a get-rich-quick-scheme at all. Instead, it’s a story of persistence, boldness, risk-taking, and unconventional thinking. After seeing a man in a Lamborghini when he was a teenager, MJ DeMarco knew he wanted to be rich, but he didn’t want to slave away for 40 years to get there. After launching, selling, and re-buying his own company, he retired at age 33 as a multi-millionaire. An inspiring read!

8. Think and Grow Rich by Napoleon Hill

“The starting point of all achievement is DESIRE. Keep this constantly in mind. Weak desire brings weak results, just as a small fire makes a small amount of heat.”

— Napoleon Hill

The Book in One Sentence

Think and Grow Rich is a curation of the 13 most common habits of wealthy and successful people, distilled from studying over 500 individuals over the course of 20 years.

Key Takeaways

  1. Use autosuggestion to build an unshakeable belief in yourself.
  2. Be stubborn and always stick to your decisions.
  3. Join a Mastermind group to cut your learning curve.

Why should you read it?

This might be the most popular book about success in the world. After steel magnate Andrew Carnegie himself put him on to the task, Napoleon Hill interviewed successful individuals for 20 years. The result, was published in 1937 and has sold 70 million copies. It’s a book about thinking, vision, and doing what it takes to succeed. If you’re a young entrepreneur, this is for you.

For Saving Money

9. I Will Teach You To Be Rich by Ramit Sethi

“Getting started is more important than becoming an expert.”

— Ramit Sethi

The Book in One Sentence

I Will Teach You To Be Rich helps you save money on autopilot while allowing yourself to spend guilt-free on the things you enjoy.

Key Takeaways

  1. You’re the only one responsible for your financial problems.
  2. Know how much money you have coming in and then automatically direct it where you want it to end up.
  3. Start investing today, even if it’s just $1.

Why should you read it?

Ramit Sethi’s blog started in his dorm room in 2004. After selling an ebook for a few dollars and seeing the magic of earning online, he doubled down. 15 years later, GrowthLab makes millions in annual revenue with online courses. His New York Times bestseller will help you cut costs in every area of life, splurge on the things you enjoy, and automate your retirement planning. A down-to-earth perspective from someone who’s done it.

10. The Total Money Makeover by Dave Ramsey

“We buy things we don’t need with money we don’t have to impress people we don’t like.”

— Dave Ramsey

The Book in One Sentence

The Total Money Makeover shows you how to stop accepting debt as normal, eliminate it forever in small increments, and build the financial future you deserve in seven steps.

Key Takeaways

  1. Before you do anything else, put away $1,000 in an emergency fund.
  2. Start paying down your debts, beginning with the smallest.
  3. Grow your emergency fund until you have at least a three-month buffer.

Why should you read it?

The Dave Ramsey Show is one of USA’s most popular radio shows ever. Ramsey helps people become debt-free, at which point they go on his show to talk about the experience. He also helps them with the emotional issues of tackling money and goes beyond mere mathematical tips. Ramsey encourages you to tackle your debts from small to large, then slowly start saving, and only invest after you’ve covered the basics. A rock-solid approach to finance.

For Retirement

11. The Automatic Millionaire by David Bach

“The fact is, none of us really has a choice: We are all playing the money game whether we want to or not. The only question is: Are we winning?”

— David Bach

The Book in One Sentence

The Automatic Millionaire is an actionable, step-by-step plan for building wealth without being disciplined by relying on fixed percentages, small payments, and automated transactions.

Key Takeaways

  1. Saving a little every day will go a long way.
  2. Pay yourself first to take care of your financial future.
  3. Automatic payments allow you to invest in a disciplined manner without being disciplined yourself.

Why should you read it?

When he was seven years old, his grandma took David Bach to McDonald’s. Over lunch, she told him there are three types of people in the world: those who eat at McDonald’s, those who work at McDonald’s, and those who invest in McDonald’s. Wow! Later, Bach became a vice president at Morgan Stanley. Today, he runs a consultancy and publishes books. 7 of 12 are New York Times bestsellers, and this one is his most practical template for building wealth.

12. The Millionaire Next Door by Thomas J. Stanley

“Whatever your income, always live below your means.”

— Thomas J. Stanley

The Book in One Sentence

The Millionaire Next Door shows you the simple spending and saving habits that lead to more cash in the bank than most people earn in their life while helping you avoid critical mistakes on your way to financial independence.

Key Takeaways

  1. Save responsibly from the moment you first start earning more than you need to live.
  2. Use a simple net worth formula to calculate if you’re falling short of your financial potential.
  3. Avoid economic outpatient care — spending too much money supporting others — to reach your goal.

Why should you read it?

Stanley and his co-author William Danko studied people with normal incomes and high net worths for decades. The book helps you avoid becoming a UAW — an under-accumulator of wealth. Most people could save half their income. This book shows you why that’s worth the effort in the long run.

For Financial Freedom

13. Secrets Of The Millionaire Mind by T. Harv Eker

“If you want to change the fruits, you will first have to change the roots. If you want to change the visible, you must first change the invisible.”

— T. Harv Eker

The Book in One Sentence

Secrets Of The Millionaire Mind suggests our financial success is not determined from birth and shows us what to do to break through mental barriers and acquire the habits and thinking of the rich.

Key Takeaways

  1. You naturally tend to replicate your parents’ income strategies.
  2. If you want to control your finances, you first have to realize you’re the one at the wheel.
  3. Don’t despise rich people or you’ll never become rich yourself.

Why should you read it?

After an absolute rollercoaster of building, selling, losing, and failing at over a dozen businesses, T. Harv Eker analyzed his own relationship with money. He found he’d just emulated his parents’ financial strategies, and so do most of us. This book will help you undo the damaging aspects of that wiring and replace it with solid financial thinking and habits.

14. The Richest Man In Babylon by George Clason

“Advice is one thing that is freely given away, but watch that you only take what is worth having.”

— George S. Clason

The Book in One Sentence

The Richest Man In Babylon gives common-sense financial advice which you can apply today, told through tales and parables from the times of ancient Babylon.

Key Takeaways

  1. Live below your means.
  2. Learn how to be lucky.
  3. Never take on debt.

Why should you read it?

George S. Clason, a soldier, businessman, and writer, was smart when he published this book in 1926. Instead of giving boring advice without any credibility, he wrapped his lessons into stories from the Babylonians. Generally believed to be an astonishing people, they lent George the power to transfer these lessons to us. The advice is as sound today as it was back then.

Conclusion

We’ve summarized over 700 books so far, many of them about money. In our opinion, these are the best ones to start with.

Whether you’re recovering from an unlucky turn of events, suffering from bad financial habits picked up in childhood, or just not good at math, after diving into these books, you’ll soon create more financial breathing room in your life.

Like they say: Money never sleeps. Start today.

Related Articles

Stay Connected

18,978FansLike
13,689FollowersFollow
4,578SubscribersSubscribe

Latest Articles