Month: December 2020

Personal Finance Can Be Easy With These 5 Books

If you are here, then you probably are hoping to improve your personal finance or financial IQ. I receive regular queries for personal finance books recommendations for FIRE. I believe reading and experience are two of the greatest teachers in life.

The reading of all good books is like a conversation with the finest minds of past centuries.

Rene Descartes

Top 5 Personal Finance Books

Here’s a compiled list of five of the finest minds that myself and others in the FIRE community recommend:

“I Will Teach You To Be Reach”

This book simplifies subjects like investment, retirement plans and savings showing you a way to have those guilt-free pleasures and still have a retirement plan all at once.

The biggest focuses are:

  1. Credit is good if you use it well
  2. Research & choose wisely when it comes to bank accounts and investment plans
  3. Be aware of how much you spend, how you spend and what can you do to improve your savings.

Audience: Beginner / Still in Debt

4 Hour Work Week

** My Favorite Personal Finance Book **

The 4-Hour Work Week will give you the blueprint to change the way you think about work and design your ideal lifestyle. Rather than work until you’re 65 and retire, take control of your destiny. If you work until you’re too old to enjoy your retirement you’ve wasted so many years. 

The biggest takeaways are:

  1. D.E.A.L. principle that millionaires use
    • Definition – define your end goals
    • Elimination –  eliminate what doesn’t help you get there
    • Automation – automate as much of the process as you can
    • Liberation – enjoy your end goal
  2. When it comes to productivity, less is more
  3. Hire a virtual assistant to make your life easier

Audience: Anyone who takes on too much at work / the worker who is looking for something more.

The Psychology of Money

Broken down into twenty chapters, Housel tackles a different topic in each chapter, with the majority of these chapters feeling like their own isolated essays. 

The biggest takeaways are:

Doing well with money has a little to do with how smart you are and more to do with your behavior around money. Have discipline and don’t get influenced by others playing a different game. 

  1. Role of luck and risk
  2. Getting wealthy vs. staying wealthy
  3. Tail events drive outcomes
  4. The power of compounding
  5. The role of surprises and unknowns
  6. Folly of forecasters (using the past as a guide to future scenarios)
  7. Nothings Free

Audience: Those looking for beginner investing, personal finance psychology knowledge

Work Optional

Work Optional walks you through envisioning your dream life, creating a solid financial plan to support you, and achieving a purpose-filled early retirement, semi-retirement or career intermission with completely doable, non-penny-pinching steps

The biggest takeaways are:

Living your optimal life isn’t something you have to put off until you reach FI — you can structure your life so that it’s closer to that optimal life, even while you still need to work to pay your bills.

  • Learn to build a solid early retirement financial plan and account for future expenses you can plan for—and those you can’t
  • How to retire early with kids, as a single person, or while supporting loved ones
  • How to make your plan bulletproof to withstand economic downturns

Audience: Those struggling to design a lifestyle and find a why for their retirement

Essentialism

Focus: Trains the reader to maximize the “essentials” of life by strategically eliminating everything else.

The biggest takeaway:

A discipled approach to true happiness is only attainable by subtraction.

Audience: Those that feel constantly stressed, tired, hopeless, or pulled in too many directions.

Thanks for reading! These books will help get you started or further along your journey. If there are other books you’ve read and believe are helpful to improving your financial knowledge add them in the comments below!