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I am a huge nerd when it comes to reading. As a kid, I wasn’t the biggest fan, but as I have gotten older, I devour books. I try to read the newest finance books as they come out, as well as make sure I’ve covered my bases with the older ones. I thought I’d share my top 10 finance books, just in case you were looking for a good summer read. So without further ado, check them out!
Summary: This book dispenses valuable financial lessons in the forms of parables, like you would find in the Bible. The setting is ancient Babylon. George Clason originally wrote it in 1926. There are seven core money management rules to learn in order to be successful with money:
- Start thy purse to fattening.
- Control thy expenditure.
- Make thy gold multiply.
- Guard thy treasures from loss.
- Make of thy dwelling a profitable investment.
- Insure a future income.
- Increase thy ability to earn.
You should be able to read through it quickly, but it is one that you’ll come back to enjoying over and over again.
Quote: “Advice is one thing that is freely given away, but watch that you only take what is worth having.”
Summary: This is a classic real estate book that everyone was reading in the 2000s when housing was on the rise. It’s the tale of two Dads, one that depends on his employer for his salary, while the other Dad works for himself and makes money through passive income. Both of these men influence author Robert Kiyosaki in regards to money and investing.
Quote: “Winners are not afraid of losing. But losers are. Failure is part of the process of success. People who avoid failure also avoid success.”
Summary: This book is a compilation of the research done by Thomas Stanley that examines the seven underlying behaviors of those who have net-worths that exceed $1 million. It dispels many myths of what a millionaire looks like and exposes that most millionaires actually live a really simplistic lifestyle.
Quote: “Have you ever noticed those people whom you see jogging day after day? They are the ones who seem not to need to jog. But that’s why they are fit. Those who are wealthy work at staying financially fit. But those who are not financially fit do little to change their status.”
Summary: Author Napoleon Hill wrote this as a commission for Andrew Carnegie, the great steel magnet. Hill interviewed over 500 giants of the 20th century. These include men such as Henry Ford, J.P Morgan, Wilbur Wright, and John D. Rockefeller. The book includes insights from these great men. The best part is that this advice is still applicable today.
Quote: “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.”
Summary: Author Burton Malkiel points out that most people cannot consistently outperform the market. He highlights the flaws in technical and fundamental analysis and shows why most investors would be better off with a passive approach to investing. The “random” qualifier directly points to Malkiel’s perspective on the stock market.
Quote: “Two-thirds of professionally managed funds are regularly outperformed by a broad capitalization-weighted index fund with equivalent risk, and those that do appear to produce excess returns in one period are not likely to do so in the next. The record of professionals does not suggest that sufficient predictability exists in the stock market to produce exploitable arbitrage opportunities.”
Summary: This is easily one of the best financial books that I’ve read in awhile. At some point, you feel like you’ve read just about everything there is to know in regards to finances. But then you start reading this one. He has an easy tone when he writes about how to optimize your finances as he seeks to rid the reader of guilt about spending on that which is enjoyable.
Quote: “My friend Jim once called to tell me that he’d gotten a raise at work. On the same day, he moved into a smaller apartment. Why? Because he doesn’t care very much about where he lives, but he loves spending money on camping and biking. That’s called conscious spending.”
Summary: Author David Bach gives a wealth of information in this book. He advocates for saving 10-15% of gross income and depositing that into your retirement account. Bach also advises on topics such as purchasing real estate, paying down debt, and donating money to charities. He also explains the power of compounding interest, which is near and dear to my heart. While these are all simple concepts, the book serves as a reminder for some and a guide for others.
Quote: “Remember, inspiration unused is merely entertainment. To get new results, you need to take new actions.”
Summary: If you’re a Bogelhead, or if passive investing interests you, this is a must-read. The author is John Bogle, the man who founded Vanguard. He emphasizes the superior returns of passive index funds and why most people cannot beat the market.
Quote: “It will also tell you how easy it is to do just that: simply buy the entire stock market. Then, once you have bought your stocks, get out of the casino and stay out. Just hold the market portfolio forever. And that’s what the index fund does. This investment philosophy is not only simple and elegant. The arithmetic on which it is based is irrefutable. But it is not easy to follow its discipline.”
Summary: If you’re a stock investor, this the investor’s Bible. After all, the father of value investing, Benjamin Graham, wrote it. This is the man that Warren Buffett learned from. If Warren Buffett said that The Intelligent Investor changed his life, it should be well worth your time as well.
Quote: “Back in the spring of 1720, Sir Isaac Newton owned shares in the South Sea Company, the hottest stock in England. Sensing that the market was getting out of hand, the great physicist muttered that he ‘could calculate the motions of the heavenly bodies, but not the madness of the people.’ Newton dumped his South Sea shares, pocketing a 100% profit totaling £7,000. But just months later, swept up in the wild enthusiasm of the market, Newton jumped back in at a much higher price—and lost £20,000 (or more than $3 million in today’s money). For the rest of his life, he forbade anyone to speak the words “South Sea” in his presence.”
Summary: This is a wonderful book that reveals the strategies that led to King Solomon’s wealth. Dr. Gary Smalley challenged the author Steven Scott to study the book of Proverbs. Through this study, Scott unlocked some powerful verses that are still applicable today in regards to wealth-building.
Quote: “A VISION is a precise, clearly defined goal with a detailed plan and timetable for achieving that goal.”