My Favorite 10 Classic Personal Finance Books
These books earned a spot on my 2019 list of classic personal finance books, not because they were best sellers in 2018 or or because they received five hundred 5-star reviews on Amazon. These books captured my attention with their promises of realism, simplicity, or direct approach to the subject of money management. Additionally, they deliver practical ideas for Joe or Jane Public while also prompting readers to reconsider the money beliefs and behaviors of others as well as their own.
There are certainly books I have enjoyed that I could have included but did not, such as Think and Grow Rich and For Love & Money, but I needed to create a list that addresses a variety of topics and viewpoints while limiting it to just 10 publications.
If a book is no longer in print, I recommend you find it at your city or county library, search for a used copy online or otherwise do what it takes to get your hands and eyeballs on it.
My Top 10 List of Classic Personal Finance Books of All-time
1. A Framework for Understanding Poverty: A Cognitive Approach Created for Educators, Employers, Policymakers, and Service Providers, by Ruby K. Payne
Much controversy exists over the conclusions and suggestions made in Dr. Payne’s book, and the writing rarely spellbinds readers. Notwithstanding, if you read this book and do not come away with a different perspective on generational poverty, you are missing an important component for addressing need and indigence in your community. Framework acknowledges that financial stability, success and mobility do not depend upon skills or knowledge but upon the belief systems not only of the individual but of the family and community in which he or she resides. After reading this book, you should constantly be asking yourself, “Am I basing my financial decisions on relationships (poverty), achievement (middle class) or connections (wealth). Controversial? Yes. Insightful? Definitely!
2. Money Harmony: Resolving Money Conflicts in Your Life and Relationships, by Olivia Mellan
When two individuals become a couple, the term “personal finance” needs to be replaced by “household finance.” Although this book was written before email, let alone the Internet, became a household word, Mellan shares her insight garnered from her years of practice counseling couples. The principles she has included are timeless in their application and practical by nature. As you read about the dozens of money personalities she identifies, you are bound to see your own and that of your partner or spouse. Some “money and relationship” books have concluded that many, if not most, couples will benefit from keeping finances personal inside their marriage rather than converting them to household finances. While Mellan recognizes that this may still happen in many relationships, she also provides step-by-step tools for moving toward the middle where less suspicion and more mutual respect exist.
3. Rescue Your Money, by Ric Edelman
One of the best short reads on good, long-term investment advice, this book is full of plenty of graphs, charts, and tables, making its 160 half-size pages feel like something you could read next time you’re in the doctor’s office waiting room.
4. The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich, by David Bach.
By “one-step plan,” Bach means just one step. That said, how to implement that plan varies by individual and household. Still, no one should dismiss the plan due to its simplicity. Automating your finances does more than just simplify them. It creates a long-term perspective, increases the chances for short-term emergency fund building, and improves the likelihood of building wealth over your lifetime.
5. The Berenstain Bears Trouble with Money, by Jan and Stan Berenstain.
Although a children’s book and dating back to the early ‘90s, its lessons are timeless and universal. Trouble with Money addresses all four money modes: Spend, Save, Earn and Give. Additionally, the Berenstains encourage cubs and bears everywhere to take inventory of your own strengths and use them to improve your life and the lives of those around you.
6. The Difference: How Anyone Can Prosper in Even the Toughest Times, by Jean Chatzky
Living paycheck-to-paycheck is not a modern phenomenon. Modern society has, however, seemed intent on popularizing the notion. Chatzky identifies the key attitudes and behaviors financially successful individuals have developed. The good news is that these attitudes and behaviors are learned. It does not take a PhD. or an MBA to become financially stable and successful. The book lands firmly in the camp advocating the power of conviction and commitment to sound values and standards.
7. The Little Book that Beats the Market, by Joel Greenblatt.
Regardless of whether you choose to follow the “magic formula investing” stock screener, this book is a quick and easy read, providing readers with a better understanding of stocks and how to get involved in building your own portfolio. While an index fund may still be your vehicle of choice for long-term investments, this book provides readers with feelings of empowerment in the face of too many investment options.
8. The Next Millionaire Next Door, by Thomas Stanley and Sarah Stanley Fallaw
The latest in the series of millionaire myth-busting books by Thomas Stanley (1944-2015), this book offers a resounding, “No!” to the question, “Weren’t the conclusions of the Millionaire Next Door based on the anomalous tech bubble of young millionaires?” After more than twenty years of data-based research, The Next Millionaire Next Door offers solid advice and analogies to keep the would-be millionaire wannabes from spending his or her way into the poor house.
9. The Richest Man in Babylon, by George Samuel Clason
The oldest book on this list, Richest was originally published back in 1926. Written as a parable of characters set in ancient Babylon who make business and money decisions, this book presents universally-applicable rules that include the finally benefits of home ownership, saving for emergencies and goals, establishing spending controls, managing risk through insurance products, investing for the long-term, and seeking education over a lifetime.
10. The Road to 850: Proven Strategies for Increasing Your FICO® Credit Scores, by Al Bingham
America’s best kept secret expert on credit scores, Al Bingham shares the results of his years of research and direct, decision-making experiences with the FICO® credit score. FICO makes available to the public its pie chart summarizing 5 score factors, but Bingham explains nearly 40 codes used by the consumer reporting agencies that affect your credit score for better or for worse. In and of itself, such information is sufficient for this book to make the list, but it also provides simple and practical strategies for building (or rebuilding) credit scores in addition to dealing with harassing collection agencies.
11. Bonus: Everyday Money for Everyday People, by Todd Christensen
I did not place my own 2014 book on the Top 10 Classic list in order to avoid the appearance of arrogance. Nobody likes to hear others toot their own horn. That said, I am confident that the stories and practical ideas shared in Everyday Money (usually originating by those attending my workshops) will benefit just about any household. As I say in my classes, the people I worry most about are those who already know everything there is to know about money. Each chapter ends with lists of Do’s and Don’ts, relevant Step-by-Step checklists, quotes, facts, stories and stats. There is something for everyone.
Thanks for reading, I’d be happy hear about your favorite personal finance books! Be sure to leave a comment if you feel I’m missing a great book!