Back when I was deep in debt and spending everything I earned I didn’t even know I had a problem. I thought I was doing OK, making the minimum payments on my debt and having enough money for food to last me until payday. Heck, I thought I was doing really well.
BUT I did want to travel, and I knew my credit card and consumer debt was stopping me so I began to educate myself. I would hang out in the finance aisles at bookshops and the local library, picking up books that appealed to me. Some were way over my head with technical detail. Some were just plain boring. I soon realised the books that appealed to me the most were personal stories. I wanted to read about how other people had gotten out of debt, saved for a house deposit, purchased investment properties or built wealth.
I’ve read all of the below books. They are from the United States, United Kingdom and Australia. Where they are from is not important. I’m from New Zealand but I was most inspired by a book from a woman in London. The specifics aren’t important when you’re just starting out on your money journey, motivation and inspiration are what you need to take action. The books below have it in spades. These are stories to inspire a newbie to take that first step towards getting their money sorted.
To clarify, all of the links below are to Amazon but you could probably get these from your local library.
The Best Personal Finance Books for Beginners (according to me)
I picked this up purely out of curiosity. Why on earth would anyone choose to live on just a pound a day? Well, the author wanted to buy her brother a very expensive wedding gift. She only worked part-time and didn’t want to change that, so she had to scrimp on her living costs. Now I think back it was a very simple concept, but at the time I ate out for almost every meal and spent hundreds each week on non-essentials like handbags and vodka. This book is an easy read and I recommend it for the complete beginner. There’s no big scary numbers in it. It was this book that spurred me to question how different life could be if I just stopped spending.
- I’ve always had an interest in investment property, as it’s in our family. But getting my first cash deposit together seemed impossible as I couldn’t save money because I spent it all. This book was a really interesting read about how Steve McKnight built a property portfolio from scratch using a variety of different methods and creative financing. I really liked the simple breakdown. I’d recommend From 0-130 properties for anybody interested in property investment as a vehicle for building wealth. It’s Australia-centric but the basic concepts are applicable anywhere.
- Full disclosure – I was given a copy of this book to review last year. And I still loved it because it was easy to understand and, more importantly, easy to implement. Anyone can write a one-page financial plan. It’s written by Carl Richards of The Behaviour Gap and illustrated with gloriously simple hand-drawn charts. The author is a certified financial planner so his advice is backed by credentials without being jargony. I’d recommend The One-Page Financial Plan for people who want to create a big picture plan for their finances.
Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence by Vicki Robin and Joe Dominguez
I have only recently read Your Money or Your Life so it’s fresh in my mind. The impact it had on me wasn’t as great as it could have been because I regularly read and write about money and financial priorities. Had I read this 10 years ago, I’m pretty sure my life would be a lot different. My boys will both get a copy of this for their 18th birthday. Some say it’s the original book on financial independence as it eschews consumerism and queries some norms such as the costs of working (daily coffee, professional wardrobe, transport etc) and their impact on your real earnings. It was not an easy read for me but that’s because I have a baby so books now take forever to get through. I’d recommend this for people who know they need to save and maybe have a budget in place but can’t really cross the divide between living frugally and building wealth.
This is another frugality book, which was exactly what I needed when I read it. It details how the author and her husband paid off their home in three years with an income under $50/k per year. It covers the core concepts of money management but its strength lies in the mortgage information specifically targeted towards first home buyers. This includes getting your deposit together, finding the right house and how much you should spend. Note the examples are outdated when it comes to current houses prices BUT the core principles of budgeting and making sacrifices to pay off your mortgage faster still apply. I’d recommend it for people wanting to buy their first home.
So there’s my top 5. I’ve read way more than that obviously, but I’m only recommending the books I think a novice money manager would enjoy.
What is your favourite money book? Have you read any of my favourites?