What are the best finance books for beginners?
This is a tough question to answer, because there are many books out there that will teach you about personal finance, but so many of them contain jargon which can be hard to understand and really off putting.
Personal finance is a dry subject at the best of times so when you’re a beginner wanting to find out more, you need books that help and make sense, not send you to sleep!
How to find the must read finance books that are going to make sense to you and help you quickly manage your money better?
Easy!
Check out the list below of what I personally consider to be the best personal finance books of all time, perfect for beginners but also great for more experienced folk.
I don’t have a degree, nor have I ever worked in finance. I took forever to dip my toes into investing, because I didn’t think I knew enough, wasn’t clever enough to get it right. And with a low income, I needed my money to be done right, every time.
I’m an avid reader and I must have read over 50 personal finance books. Yawn!
Some of them really are dry, and to be honest, boring! They dive deep into the technical and jargonistic parts of investing and personal finance, talking about stuff you and I are never going to want or need to know.
But you do need to know about personal finance and the best way to learn more is to find the best finance books for you and your situation.
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Why do I need to read personal finance books?
Personal finance books can show you how to:
- Break free from living paycheck-to-paycheck
- Start saving money
- Pay off your credit cards
- Get out of debt
- Increase your net worth
Reading the right financial books will help you understand your financial situation better and make plans for your money that will make your future financially secure.
These must read finance books below are written with the beginner in mind. Someone who is looking to improve their financial literacy and make changes that will leave them better off in the long run.
Why didn’t anyone teach me this in school?
That’s a great question and perhaps one to take up with your local politician. Many finance gurus are actively calling on their govenments to do exactly this.
Everyone needs to understand about debt, compound interest, mortgages and retirement savings. Why it’s not at the heart of the school curriculum is beyond me!
How can I teach myself personal finance?
Learning about finance can be a difficult task, but it doesn’t have to be, as long as you are willing to invest a few hours into reading a book or two on the subject. Taking notes as you go is also really helpful. Because who can memorize an entire book of new information?!
There is a lot to know when it comes to personal finance, such as investing in the stock market, making tax efficient savings and setting up retirement accounts.
Knowing how to invest in the stock market and in what, is not easy when you don’t understand any of the acronyms or terms that are used.
Personal financial books are an integral part of learning how to manage your money, these books will help you understand the acronyms, the terms and they focus on doing so in a plain language kind of way.
How can I tell the good financial advice from the bad?
That’s where books come into their own. Especially books that have been reviewed hundreds and thousands of times on Amazon, GoodReads and the like.
I wouldn’t want you to just take my word for it that these books contain great information. But hundreds of reviews will give you confidence that the financial information in each of these books is pretty solid.
What is the best financial book to read?
The best financial book to read is the one that you are most interested in reading, but also makes sense for your current financial situation. It’s the one that you keep returning to in order to keep your knowledge fresh.
If I had to give you just one then the best financial book for beginners to read would, in my personal opinion, be
In summary though, it’s written in language you can understand, it’s covers all of your finances from when you are just starting out after college to retirement. And the advice is straightforward and simple.
What books should I read to learn finance?
To learn finance for yourself it pays to read around the subject. If you want to know about investing in the stock market, then read a couple of books on that subject. Interested in crypto currencies (please don’t be!) then read up on those. Same for REITs, ISAs and the like.
What is the number 1 personal finance book of all time?
The number one personal finance book of all time is likely to be
It’s a classic with 640 pages but it’s not for beginners. Seriously. It’s great for detailed theory but as a go to book for you and I beginners? No.
The Best finance books for beginners: My top 11
There are thousands of books on personal finance on Amazon and in bookstores. Many of them provide really detailed information but not in an easy to understand format.
When it comes to getting started on your journey to learning more about finance, books need to be easily to understand and digestible.
1. The Simple Path to Wealth
If you know little to nothing about the stock market yet know you need to do more than just put your money into a savings account then this book is for you.
It’s perfect for beginners and indeed for people who are sick of chasing after the latest stock market trend only to find they lose money.
If you are a beginner and only read one finance book then this is the book I would strongly recommend you read. Why? Because it really is one of the best books to learn finance for beginners and covers everything you need to invest and plan your money for your future.
The
- Avoid/get rid of debt
- Live below your means
- Invest in low-cost index funds
- And then do nothing!
In some ways, the plan for your money is positively boring. Get things set up, automate them and then almost forget them, until you are nearing retirement.
As a Brit there is one aspect of the book that anyone not living in the US needs to be aware of. Living in the US, Collins is insistent that you don’t need to invest in international stocks. While that may be ok for folks in the US, it absolutely is not for everyone else.
And the reality is there is no need for anyone to ignore international stocks when there are low cost global funds to invest in.
As a Brit, if I only invested in the FTSE my portfolio would be far too narrow and have suffered badly during Brexit, the pandemic and many other short term issues.
When the FTSE dropped hugely due to Brexit, my funds did not. Because I was invested in global funds. The US market did not drop due to issues with Brexit so my money was protected.
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2. The little Book of Common Sense Investing
Don’t get scared or put off by the word investing. Investing is good and it doesn’t have to be scary. You need to invest your money not just save it. And this book along with some of the others explains how to do it the easy way.
In The Simple Path to Wealth above, JL Collins advises everyone to buy and hold Vanguard funds. This book is written by the founder of Vanguard so you can see why it’s one of the best books about finance and investing for beginners and why it made my list.
- Costs for buying and selling stocks compound badly
- Active investors usually fail to produce good results because of the costs of trading and other expenses (e.g. capital gains tax)
- Buying index funds enables you to reduce the emotional stress and you’re less likely to panic or get greedy when the stock market goes up and down rapidly.
There are plenty of examples, with data, to show why index funds are the way to go for almost everyone.
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3. Total Money Makeover
Dave Ramsey’s 7 Baby Steps are synonymous with debt freedom. And
You could call this book tough love but the reality is, Ramsey is basically telling you how it is. He is a fan of using the cash envelope system and dumping your credit cards. After all, those cards are often responsible for the debt you have built up.
The 7 Baby Steps are essential steps in your journey to improving your finances and taking back control of them. Steps include:
- Building a $1000 emergency fund, (as a matter of urgency)
- Pay off all your debt using the debt snowball method
- Investing for your retirement
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In the UK?
If you’re in the UK then Baby Step no.5 is not relevant (the student loan system covers this) but don’t let this stop you from reading the book.
Many lives have been transformed as a result of reading Total Money Makeover and the principles he teaches are as relevant to the UK as they are to the US.
4. Money Honey
Money Honey is aimed at the younger generation, those starting out on their financial journey. Written in a fun, humour filled style that helps explain detailed information in a fresh and interesting way.
As a millennial, Richards knows the problems other millennials face when it comes to adulting. Things I think you will love about
- So easy to understand and straight to the point
- The diagrams help hit home her messaging
- Simple, logical advice and specific steps to follow to get started and continue the journey.
She knows finances are not a one size fits all, she talks about different situations and ways to navigate that fit your cirumstances
It’s written in a funny and relevant style – some financial books can be painfully boring (but not on my list!). The 4 bucket system will get you saving harder than you thought possible.
If you’re not financially savvy (and who is when they want to know about the best finance books for beginners?) then Richards 7 step plan is easy to follow and will have you feeling financially literate in a matter of weeks.
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5. Your Money or Your Life
This is not a book about investing. Indeed you should ignore the final chapters or any reference to investing because the advice is completely out of date. (Read one of the books above instead).
What
There is advice on how to save money and live frugally but much more discussion on why you might want or need to live life differently.
The biggest wake up call that YMOYL gave me was in Chapter 3 when Vicki talks about how:
Money is something we choose to trade our life energy for
Vicki Robin
That really hit home.
We give our life’s precious energy to a job that we likely wouldn’t do if we were millionaires. The book talks about equating our income to units of time. By doing this, you work out the price of something in hours/weeks or whatever, rather than $$$s.
So something that costs $100, is worth a lot more to someone who earns $50 a week than it is for someone who earns $1000 a week. Working out how many hours you have to work in order to buy something makes you think harder about how you spend your hard earned cash.
It certainly makes you think twice about buying lunch at work instead of bringing your own!
I credit YMOYL with starting me on the path to financial independence, something I achieved (on a moderate income) and subsequently retired 17 years early. I also retired the husband!
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6. Clever Girl Finance: Ditch Debt, Save money and Build Real Wealth
The perfect finance book for beginners focused on women. Women tend to earn less and live longer yet we often shy away from learning about the intricacies of personal finance. We need to know how to manage our own money and Sokunbi knows this.
As the successful author behind the Clever Girl Finance website, she knows her stuff. She uses her own personal money mistakes and how she came through them to help educate and ultimately empower women to find their own path to financial success.
- Your money mindset
- How to get your money organized
- Debt, loans and investing
- Protecting yourself
- And key financial actions
What I love is that each section has helpful “Take Action” checklists with activities you can do to better understand your relationship to money. Reading and digestion information is great, but taking action improves your understanding and long term commitment ten-fold.
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7. Get a Financial Life
Beth’s book is aimed at finance beginners in their 20s and 30s. It’s a textbook for getting your finances in order as a young adult. Set them up, then keep them that way and you’ll retire happy and wealthy.
If you are sick of stressing about money and don’t know where to start then Get a Financial Life is exactly what you need to read.
Originally written in 1996,
For those of you who always have good intentions when you pick up a book but give up within a couple of chapters, Rachel has you sussed and covered. The first chapter is called Crib Notes and is a cheat sheet for the time pressed who need money help straight away.
Each chapter is a step on the road to both building your financial knowledge and creating your action plan for your future finances.
She starts with your financial goals, if you don’t have goals then you can’t plan and if you don’t plan then all you do is spend. And her chapters on insurances and taxes are an area that are often missed by other personal finance books. Yet you need to know these as part of your financial education.
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8. Money: A Users Guide (for UK people)
To get started with understanding your money you need a guide, and this is the book for UK readers. Many people don’t feel comfortable talking about money and their finances. You will after reading
Whateley’s book is an instruction manual which really should be on the UK school curriculum mandatory reading. She demystifies everything to do with finances and financial planning.
From the way too complex to the boring but oh so necessary information you need to have. She makes all of these interesting and fun.
The book covers everything from mortgages to credit scores to investing in the stock market to taxes and pensions.
It’s written and aimed primarily at the under 35s and covers all the key money aspects in plain, easily digestible English.
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9. I will Teach You to Be Rich
Another great finance book for the beginner. In my opinion it’s best for those of you in your 20s or early 30s and have yet to take on a boatload of debt and cement in a ton of lifestyle choices. If this is not you, you will still gain much from his teachings.
This is a down to earth, no bullsh*t kind of book. There are no big fancy terms or crazy plans or pages of how you must do detailed budgeting. Thankfully, as many of us are just not that into budgeting!
No,
The single most important piece of advice (like many others) is to start investing early. That way you benefit from compounding. Something I learned late, don’t make my mistake.
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10. The More of Less
Minimalism isn’t specifically about personal finance or being frugal. But there are many crossovers between them.
I am no minimalist but I love some of the messaging in
People who want to make the most of their money don’t buy too much stuff, they don’t buy too much house and they don’t try to compare their lives with others such as the Joneses.
All of which come from a more minimal viewpoint. Many minimalists aren’t living with just 33 possessions. Far from it.
What they are not doing though is spending all their hard earned cash on stuff and going into debt because of it.
Choosing to have and live with less will help you in your quest to manage your money better. Because you’ll spend much less of it on stuff.
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11. The Millionaire Next Door
In it’s own way this is one of the best books on economics and finance for beginners as it shows you how real millionaires live and work.
What better way to learn than to study those who are rich?
Through a series of interviews with millionaires you get to see what being a millionaire is really like. How they live, what they buy (as importantly, what they don’t buy) and how they became rich. It goes through the 7 traits of what the wealthy have in common.
What really hit home for me when I read
A fascinating read to make you re-think your ideals on what it’s like to be a millionaire.
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12. BONUS BOOK – Broke Millennial: Stop Scraping By and Get Your Financial Life Together
This book is a great introduction to personal finance. If you’re a young(ish) person and want to start getting control of your money this book is for you. Lowry focuses heavily on the mental aspect of finances, which I personally think is crucially important.
If you don’t have the right money mindset then everything else is going to be that much harder to achieve. Her aim with Broke Millennial is to give you a step-by-step guide on how to go from flat-broke to financial badass.
Some of the areas that she focuses on include:
- The mental money blocks you may have (based on your childhood and parents)
- How to overcome bad financial mindsets and create better ones
- The different financial products out there (investment accounts, bank accounts, credit cards) and how to look for the best ones
- Basics of investing and retirement planning
In a nutshell
I’ve read many personal finance books and rarely come across book that is comprehensive and interesting enough to keep my attention. You will also find a nice balance of storytelling and practical advice which help drive home her messages.
It’s a solid book on how to go from not knowing much about your money, to feeling badass and in complete control of your money.
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best books on finance for beginners who enjoy a good read
Many personal finance books for beginners or seasoned investors are dry! You have to be dedicated to get through them and find the nuggets of wisdom buried in all the data and dry writing style.
The best personal finance books for beginners will always be the ones that you enjoy reading. Such that you actually not only finish the book but have retained a ton of useful information.
I want to learn about being frugal, not the stock market
If you want to learn about being frugal and what the frugal lifestyle can offer you right now rather than how to start investing then fear not. I started my financial journey by becoming frugal and reading a ton of frugal books.
Only once I had got my frugal lifestyle thoroughly sorted did I delve into more aspects of personal finance like investing and retirement accounts.
The absolute best frugal living book, in my humble opinion, is The Tightwad Gazette and you can read my post here on how the Tightwad Gazette will change your life.
For more frugal books then check out my post on the best frugal living books.
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Final thoughts on the best personal finance books for beginners
Reading books on finance helps develop your confidence and understanding to the point where you will feel comfortable in taking your first steps to getting your financial life organized.
There are a lot of finance books out there to choose from. The 11 I have chosen are perfect for beginners, and more seasoned folk who dislike dry, technical books.
These recommendations are all about personal finance. If you want the best business finance books for beginners or the best quantitative finance books for beginners then you’ll need to do a bit more research. I don’t do quantitative finance!
You don’t need an advanced degree in economics or finance as a prerequisite before reading these books. In fact they are perfect for everyone from a teen still in college to someone older who’s a late comer to financial planning.
The most important thing for me is that you chose one, read it, enjoy it and feel more confident as a result. That’s what a great beginners finance book will do for you.
Start taking back control of your money by grabbing your copy of the Money Saving Starter Guide today.
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Last Updated on 17th January 2022 by Emma
