Personal Finance

Best Books On How To Save Money

By David Krug David Krug is the CEO & President of Bankovia. He's a lifelong expat who has lived in the Philippines, Mexico, Thailand, and Colombia. When he's not reading about cryptocurrencies, he's researching the latest personal finance software. 7 minute read

Most people in the U.S. today are extremely financially illiterate. Only one-third of U.S. adults were able to properly answer at least four out of five questions regarding basic financial concepts like compound interest and inflation in a 2018 FINRA Foundation survey. 

Meanwhile, our ignorance is costing us dearly. The National Financial Educators Council polled 1,500 U.S. residents in 2019 and found that poor financial health cost respondents an average of $1,230 in the previous 12 months.

Reading up on the topic is one approach to increase your knowledge of financial matters. There are countless books covering anything from how to start a budget to how to retire early available at your local library or bookshop.

Best Books on Personal Finance

Inevitably, you won’t have time to devour every book on personal finance now available. Thankfully, that’s not necessary. There is little variation in the contents of books on various financial topics.

Several publications are available that serve as a comprehensive introduction to the topics of personal finance and money management. Newcomers to the world of finance will find them to be an ideal introduction to the fundamentals of earning, saving, investing, and forming good habits with one’s money.

  1. “The Richest Man in Babylon” by George S. Clason

George S. Clason penned a number of brochures for financial institutions and insurance agencies to distribute to their clients in the 1920s. However, he didn’t merely provide the information like a textbook would. Clason used short stories about ancient Babylon to convey economic concepts as parables. In 1926, the short stories were so popular that they were collected into a book.

This timeless work is still widely read in the modern world because of the practical advice it offers on managing one’s personal finances. Budgeting, retirement planning, and avoiding high-risk investments and quick-rich schemes are emphasized.

With the expiration of the copyright for this older book comes the joy of being able to read it in its entirety for nothing at all on the Internet Archive. If you’d rather have a printed copy, though, you can get one from places like Amazon or any number of bookstores.

  1. “The Index Card” by Helaine Olen and Harold Pollack

Check out “The Index Card: Why Personal Finance Doesn’t Have to be Complicated” for a less complicated, more contemporary approach to personal finance. The document condenses the fundamentals of financial management into 10 guidelines that might be written on a single 4-by-6-inch index card.

An interview Olen had with Pollack in 2013 was the seed for the concept, as Pollack casually said in the conversation that the finest financial advice might fit on an index card. A deluge of requests for similar greeting cards encouraged the two to put their concept into book form.

Guidelines like “save 10-20% of your salary” and “pay off your credit card amount in full every month” are highlighted by Pollack and Olen. There is a whole chapter dedicated to each of these ideas. However, they are also presented in a list format that may be copied onto an index card for later use. To sum it up, this book is perfect for newcomers and everyone who values concise, straightforward guidance.

  1. “The Automatic Millionaire” by David Bach

Of David Bach’s 12 books on personal finance, 11 have been national blockbusters, and two have debuted at the top of The New York Times bestseller list, including “The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich.” In this book, he explains how to amass wealth over the course of a lifetime rather than overnight success.

The key to Bach’s technique is to establish a routine in which you invest a small amount of money every day. He demonstrates how to invest modest amounts of money every day by cutting back on the “latte factor” – the small, recurring costs that build up over time. He claims that even if your salary is little, you can still consistently amass money by “paying yourself first” and establishing your goal as a habit.

  1. “Women & Money” by Suze Orman

There has been a lot of research done on how women and men handle money, and it turns out that women and men handle money differently. These variations can be beneficial in some ways. Generally speaking, women are more frugal than males, have a higher propensity to save money and avoid taking on large amounts of debt.

However, women have their own financial vulnerabilities as well. Compared to males, women make less money and are less confident in their financial abilities, making them poorer stock market investors. That, plus the fact that many women put their jobs on hold to care for their children full-time, means that many women lag behind males on the path to economic independence.

Suze Orman, a financial expert, hopes to alter that. In “Women & Money,” she discusses issues like fear and humiliation that prevent women of all ages from achieving financial success.

Then, she demonstrates how to face these challenges head-on and reach your monetary objectives. Orman addresses all the topics women need to know about money but are frequently too embarrassed to ask, from purchasing a car to investing for retirement, taking out student loans to making money decisions with a husband.

  1. “Broke Millennial” by Erin Lowry

The millennial generation has a unique set of financial issues compared to previous generations. There is a greater load of student loan debt, poorer salaries, and less job security for this generation than for any before it. This has led to many millennials’ inability to establish a stable financial future.

Erin Lowry, a financial expert, writes a book aimed squarely at millennials called “Broke Millennial: Stop Scraping By and Get Your Financial Life Together.” Beyond the standard fare of budgeting and investment advice, Lowry delves into the emotional side of personal finance.

When reading her work, readers will gain insight into the positive and negative effects money may have on their lives. She offers advice on how to go “financially naked” with a spouse and have a frank conversation about money, as well as how to manage sticky circumstances like splitting a check with a group of friends.

Lowry uses humorous anecdotes and social media-inspired hashtags like “#GYFLT” (get your financial life together) to reach a younger audience. She also offers each chapter a light, humorous title, such as “Is Money a Tinder Date or Marriage Material?” or “Paying Rent to your Rents.” Yet concealed behind the chuckles is serious advice on such matters as budgeting, housing, and retirement planning. Lowry’s book “captures the financial zeitgeist of this age,” according to financial expert Farnoosh Torabi, who was quoted in a New York magazine roundup of personal finance books.

  1. “You Are a Badass at Making Money” by Jen Sincero

The majority of books written on the topic of personal finance focus on the guts and bolts of managing your finances, such as investing and paying off debt. You Are a Badass at Making Money: Master the Mindset of Wealth, written by Jen Sincero, takes a different tack. She stresses that success in financial matters is mostly a mental game. She uses snarky humor to break down self-limiting thought patterns and teach the reader how to spot and capitalize upon favorable circumstances.

In their review, Business Insider notes that the book lacks “actionable financial advice.” You won’t find solid recommendations here on establishing a company, building an emergency fund, or hiring a financial adviser. This book, on the other hand, serves as a firm smack in the behind.

This is the book for you if you have ever had a dream but never pursued it because of self-doubt or fear. This might be anything from switching jobs to starting your own business to taking a trip across the world.

  1. “I Will Teach You To Be Rich” by Ramit Sethi

One may assume that a book with the subtitle “I Will Teach You To Be Rich” would include a scam promising instant wealth in exchange for little effort. Thankfully, Ramit Sethi’s landmark book is so much more. Instead, it’s a crash course on financial management and wealth creation.

To put it simply, “I Will Teach You To Be Rich” addresses every facet of your monetary existence. Sethi details in 13 chapters:

  • Increase your credit card rewards while lowering your interest rate.
  • Select the appropriate bank account to reduce bank costs.
  • Begin investing today.
  • Determine when to save and when to indulge.
  • How to Automate Saving and Investing
  • Everything from the cost of a car to your pay should be negotiated.

Critics praise Sethi’s software for eliminating tedious financial tasks. The complex process of financial planning is simplified into manageable chunks that you can implement with ease. At times, his tone may be overbearing, especially when he rails against “crybabies” and “victim culture.” But the underlying lesson that you control your own financial destiny is priceless and liberating.

Bottom Line

All of the titles below are excellent starting points for anyone looking to learn the fundamentals. Nonetheless, that’s just the beginning of the possibilities. Once you’ve got the fundamentals down, you may go looking for books that go further deeper into specialized subjects. Books about personal finance cover a wide range of topics, including how to get out of debt, how to invest, how to buy a home, and how to become financially independent.

Keep an eye out for new books on money, but be sure you thoroughly review any potential purchases to ensure they are trustworthy and informative resources. Have a look at the author’s background and experience to determine if they are competent to give financial advice. Who exactly is doing the writing? Journalists? Experts? People sharing their own financial struggles? The more you know about the writers, the less likely you are to take their unproven investing advice or participate in their get-rich-quick scams.

Keeping your expenses low is an important part of building money, so it’s wise to get the books you desire for as little as possible. You may save money on books by perusing the selections at your local library, as well as those at thrift stores, internet vendors, and book exchanges.

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