7 of the Best Personal Finance Books for Beginners to Read

7 of the Best Personal Finance Books for Beginners to Read

Reading personal finance books is one of the best and easiest ways to take charge of your money and your future. But while some of the best personal finance books contain excellent advice, they are not always geared toward the beginner.

Many individuals without much experience managing their personal finances will benefit from checking out more foundational books first. These offer a solid base for managing finances and offer the key skills beginners will need to interpret more advanced conversations for their personal needs.

Some of the best personal finance books for beginners include:

1. Nudge: Improving Decisions about Health, Wealth, and Happiness (Richard Thaler and Cass Sunstein)

Nudge provides readers with a mental framework for thinking about how to make the best decisions related to personal finance. Everyone makes financial decisions on a daily basis, yet not everyone has a clear sense of why they do what they do. This book is ideal for people who feel like they keep making poor decisions yet do not quite understand how to think about their overall finances.

With Nudge, you can begin making better, more deliberate decisions immediately and eventually establish the habits you will need to move toward a more secure future.

2. The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (John C. Bogle)

For many people, investing seems like an impenetrable world. John C. Bogle wrote The Little Book of Common Sense Investing to break down how the stock market works and outline the basic strategies for achieving success.

The book focuses on how to invest in index funds, which are low-cost and highly diversified investments designed to mimic the overall performance of the market rather than surpass it. Index funds, as Bogle explains, often generate higher returns than individual stocks, so they are a simple and beneficial strategy for long-term investing. Bogle writes in simple language that will make people feel prepared to start investing immediately.

3. The Index Card: Why Personal Finance Doesn’t Have to Be Complicated (Helaine Olen and Harold Pollack)

The Index Card masterfully breaks down the more complicated topics in personal finance, making it ideal for the beginner. Instead of providing complicated strategies without context, it helps readers understand the concepts that drive these strategies.

The book’s premise is that everything you need to know about personal finance can be written on a single index card. Readers will find 10 distinct principles for creating a financially stable future, with an entire chapter devoted to each. Some of the topics covered include saving in a 401(k), diversifying investments, and paying down debt. These concepts are foundational for financial health.

4. What Your Financial Advisor Isn’t Telling You: The 10 Essential Truths You Need to Know about Your Money (Liz Davidson)

A financial advisor can be one of the best tools you can have at your disposal as you work toward financial independence. However, not all advisors take the same approach, so it is important that you have a basic understanding of them before you hire one.

This book breaks down the features that can differ among financial advisors, such as education, experience, and fees. Davidson does not critique financial advisors; instead, she offers some tips for finding the best advisor for your individual circumstances. Along the way, she also provides some great advice about what to focus on and how to think about some of the more complex financial topics.

5. The Simple Path to Wealth: Your Road Map to Financial Independence and a Rich, Free Life (J. L. Collins)

Collins offers practical advice in a way that is actually enjoyable to read. The book was inspired by a series of letters that the author wrote to his daughter, who is mostly focused on things other than money. Thus, he wrote the book knowing that finances may not always be the most important thing on your mind.

Offering practical guidance, The Simple Path to Wealth tackles critical issues for the beginner, such as building an emergency fund as soon as possible and avoiding harmful forms of debt, as well as making your money work rather than keeping it in a savings account.

6. The Millionaire Next Door: The Surprising Acts of America’s Wealthy (Thomas J. Stanley and William D. Danko)

By looking at millionaires and the habits that they have developed, authors Stanley and Danko have broken down what it means to have a “money mindset.”

The Millionaire Next Door does a good job of showing how the habits of millionaires are not what you would think. They typically do not live in large homes or buy sports cars. Instead, most millionaires are actually quite frugal and have amassed their wealth by being responsible with how they manage their money. In other words, these are habits almost anyone can adopt to get closer to their personal financial goals.

7. Broke Millennial: Stop Scraping by and Get Your Financial Life Together (Erin Lowry)

The millennial generation must often contend with a range of different stereotypes about money, like saving too little for retirement and spending too much on luxuries. However, these criticisms often overlook the unique financial stressors millennials face that other generations have not, such as managing student loans.

Erin Lowry wrote Broke Millennial to help millennials better appreciate their particular circumstances and where they can effect change. Each chapter starts with a brief preamble about who might benefit from the content and who should skip it based on personal circumstances. In other words, it is sort of like a choose-your-own-adventure finance book.