Recap of 2021! Information you find on the internet including ones in this blog can help you with your personal finance. However, if you want to go deeper, it’s always good to get one of those finance books. Also, some people prefer physical books.
1. “The Psychology of Money” by Morgan Housel: This book explores the psychological aspects of money management and investing, and how our emotions and biases can influence our financial decisions.
“The Psychology of Money” by Morgan Housel is a book that explores the relationship between money and human behavior. Housel is a well-known financial writer and the book draws on his years of experience studying the psychology of money and its effects on people’s financial decisions.
The book is divided into 20 chapters, each of which explores a different aspect of the psychology of money. Some of the topics covered include:
– The importance of time when it comes to investing
– The power of compounding
– The impact of luck on financial success
– The role of fear and greed in financial decision-making
– The difference between wealth and income
– The impact of cultural and social norms on money management
– The benefits of simplicity in investing
– The importance of understanding your own biases and limitations
Throughout the book, Housel uses a combination of stories, anecdotes, and data to illustrate his points. He argues that understanding the psychology of money is essential for anyone who wants to make smart financial decisions, and that many of the most successful investors and savers are those who have a deep understanding of their own emotions and biases.
Overall, “The Psychology of Money” is a thought-provoking and engaging read that offers valuable insights into the ways in which our behavior and beliefs impact our financial lives. Whether you’re an experienced investor or just starting out on your financial journey, this book is well worth a read.
2. “The Intelligent Investor” by Benjamin Graham: A classic finance book that teaches the principles of value investing, the importance of long-term thinking, and how to analyze stocks.
“The Intelligent Investor” is a book written by Benjamin Graham, a famous economist and investor, first published in 1949. The book is widely regarded as a classic in the field of value investing and has been widely read and referenced by investors and financial professionals for more than 70 years.
In the book, Graham presents his ideas on value investing, which involve finding stocks that are undervalued by the market and investing in them with a long-term perspective. He emphasizes the importance of conducting thorough research and analysis of companies and their financial statements, rather than relying on market trends or speculation.
One of the key concepts introduced in the book is the idea of a “margin of safety,” which refers to the difference between the price of a stock and its intrinsic value. Graham argues that investors should only buy stocks that are priced below their intrinsic value, in order to ensure that there is a margin of safety in their investment.
In addition to discussing the principles of value investing, the book also covers various other topics related to investing, including the psychology of investing, the importance of diversification, and the use of bonds and other fixed-income securities in a portfolio.
Overall, “The Intelligent Investor” is a comprehensive guide to value investing and is considered to be one of the most influential investment books ever written. Its ideas and principles continue to be widely studied and practiced by investors around the world
3. “Rich Dad Poor Dad” by Robert Kiyosaki: This book provides insights into personal finance and money management through the author’s personal experiences and his two fathers – one rich and one poor.
“Rich Dad Poor Dad” is a personal finance book by Robert Kiyosaki, first published in 1997. The book describes Kiyosaki’s childhood and his relationship with his two “dads”: his biological father, who he refers to as “poor dad,” and his best friend’s father, who he calls “rich dad.” The book presents different financial advice and insights through the perspectives of both dads.
The main theme of the book is that to become financially successful, one needs to adopt a certain mindset and think differently about money. Kiyosaki argues that the education system teaches people to become employees and work for money, but not to become financially independent by using money to work for them.
Kiyosaki emphasizes the importance of financial literacy and understanding basic financial concepts such as assets and liabilities. He advocates for using passive income streams such as investing in real estate, stocks, and starting a business to achieve financial independence.
The book has been criticized for oversimplifying complex financial concepts and for promoting risky investment strategies. Nevertheless, “Rich Dad Poor Dad” has been a popular and influential book in the personal finance genre, inspiring many readers to take control of their financial lives and pursue their financial goals.
4. “The Simple Path to Wealth” by JL Collins: This book provides a straightforward guide to financial independence and retirement, emphasizing the importance of low-cost index funds and a long-term investment approach.
“The Simple Path to Wealth” is a personal finance book by JL Collins that aims to provide readers with a simple and effective approach to building wealth and achieving financial independence. The book is based on Collins’ own experience and research and offers practical advice on investing, saving, and managing money.
The book starts with an introduction to the concept of financial independence and why it’s important to pursue it. Collins explains that achieving financial independence means having enough money saved and invested to support your lifestyle without relying on a job or any other source of income. He also stresses the importance of avoiding debt and living below your means to save money.
The bulk of the book is devoted to explaining Collins’ investment strategy, which he calls the “Stock Series.” He advocates investing in low-cost, broadly diversified index funds, which he argues is the simplest and most effective way to build wealth over the long term. He also covers topics such as asset allocation, risk management, and the importance of staying the course and not reacting to market volatility.
In addition to his investment advice, Collins also offers practical tips on saving money and managing your finances, such as automating your savings and tracking your spending. He also addresses common myths and misconceptions about investing and personal finance, and provides answers to frequently asked questions.
Overall, “The Simple Path to Wealth” is a straightforward and easy-to-understand guide to building wealth and achieving financial independence. It’s a great resource for anyone who wants to take control of their finances and achieve their financial goals.
5. “The Total Money Makeover” by Dave Ramsey: This book provides a step-by-step plan for getting out of debt, building an emergency fund, and investing for the future. It includes practical advice on budgeting, saving, and investing for beginners.
“The Total Money Makeover” by Dave Ramsey is a personal finance book that offers practical advice for people who want to take control of their finances and achieve financial freedom. The book is based on Ramsey’s “baby steps” approach to financial management, which is designed to help people eliminate debt, build wealth, and create a solid financial foundation for the future.
Ramsey’s baby steps are:
1. Save $1,000 for an emergency fund.
2. Pay off all non-mortgage debt using the debt snowball method.
3. Save 3-6 months of expenses in an emergency fund.
4. Invest 15% of your household income in retirement accounts.
5. Save for your children’s college fund.
6. Pay off your home mortgage early.
7. Build wealth and give generously.
Throughout the book, Ramsey emphasizes the importance of living within one’s means, avoiding debt, and having a solid financial plan in place. He offers practical tips on budgeting, saving, investing, and managing money in a way that aligns with one’s values and goals.
“The Total Money Makeover” has been praised for its straightforward and actionable advice, and it has helped many people get on track with their finances and achieve financial freedom.