Financial planning is necessary for a stress-free life. While creating wealth is not exactly easy, pundits often recommend sticking to the three main rules — hard work, diligent savings, and living below your means — to build wealth.
The below-mentioned authors teach us about financial planning and analysis, and how the wealthy manage to multiply their riches. Not having to stress about money makes our lives easier to a certain degree.
The top 10 books on finance will free you from living a life of year as you prepare to tackle life head on, armed with the right tools, stories, and advice.
Financial Planning and Analysis for Personal Growth
Good habits make all the difference over time. Cultivating a habit of saving teaches us self-control and self-denial, while securing our future. P T Barnum once said, “Money is a terrible master but an excellent servant.” Having your finances under control gives you the freedom to pursue what you desire.
1. The Millionaire Next Door
One book that has continued to maintain its position as a self-help financial guide is The Millionaire Next Door: The Surprising Secrets of America’s Wealthy. Written by Thomas J Stanley and William D Danko, even after two decades, the philosophies in this book continue to help people. The book analyzes what the average American millionaire’s personality looks like and how much wealth you must generate. The authors also provide formulas to calculate one’s expected net worth.
2. The Financial Diet: A Total Beginner’s Guide to Getting Good with Money
One of the best books on finance for a beginner, Chelsea Fagan and Lauren Ver Hage helps you get good with money. Whether you are an over-spender or clueless about finance, Fagan equips you with the tools required to understand your money habits, income, and the importance of a good credit score. A simple read, it helps you with financial planning and analysis and also guides you on how to build your investments. As the title suggests, it is simple enough for a beginner to understand and work his or her way up. The book calls attention to how simple things like food and relationships influence your budget, and how to have difficult money conversations.
3. Finance for People
If you are a visual learner and likes illustrated guides, this is one of the top finance books for you. The author, Paco de Leon, is a financier and illustrator who understands most people’s aversion to financial planning. Drawing on her experiences, the author urges readers to first examine their views on money. She invites readers to change their relationship with money by blending extremely practical exercises with mindfulness.
De Leon has filled the book with over 50 diagrams and illustrations to simplify money concepts for the common man. If the very thought of untangling your finances evokes a flight or fight response in you, this book is the cure you are looking for.
One of the best financial books released this year, it is empathetic to your struggles and empowers you to take control of your financial health.
4. The Automatic Millionaire
Financial advisor David Bach exhorts his readers to leverage the powers of automation. The book starts with an inspiring story of how an average American couple managed to own two homes debt-free, put two kids through college, and still managed to retire with over $1 million in savings at 55. After catching your attention with the story, Bach compels you to set aside what you think you know about money. He then tells you how you must pay yourself first, and set up automatic payments that will secure your future, before figuring out what to do next. You know it is one of the best books on finance when it spends nothing less than 31 weeks on the New York Times bestseller list and has sold over 1.5 million copies till date.
5. Get Good with Money
If financial literacy seems out of reach, you have stumbled upon the right thing. Tiffany Aliche comes armed with worksheets and a 10-step process on how to pay off debt and save money. Aliche’s company, The Budgetnista, has so far helped over 1 million women work their way to financial well-being. She inspires confidence and tells her readers that it is possible to achieve one’s financial dreams despite one’s current income, savings, debt, or credit score. In simple terms, she delves into the fundamentals of finance and makes a once-impossible dream seem doable.
An expert with a background in education, Aliche’s book serves as a guide to cultivating good financial habits. According to her, seeing investing as looking after yourself in the future is the greatest act of self-care. She is one of the top women influencers in finance and has appeared on multiple shows to share her wisdom.
Financial Planning Books for Growing Your Business
For entrepreneurs and business people, the below listed five books offer a unique understanding on crunching numbers and the role of psychology. They are meant to help one navigate the confusing world of finance with strategies from everyone including financial advisors, an FBI negotiator, and Harvard Business School professor.
6. Profit First
Mike Michalowicz’s Profit First is one of the best financial books for entrepreneurs. The author outlines the principles of the profit first system and teaches us how to remove temptation to build a thriving business that does not bleed money. Michalowicz stresses on the fact that money is the foundation of all businesses. Without money, you cannot offer your product to the world. As an entrepreneur and investor, who has lost it all but managed to get back up again, Michalowicz shares impactful strategies on how to build a healthy, thriving business. His formula for success turns the traditional one on its head. Business schools teach us that Sales – Expenses = Profit.
But Michalowicz teaches us that Sales – Profit = Expenses. This strategy will force entrepreneurs to only allocate what remains for expenses, helping transform their businesses into money-making machines. Filled with case studies and humorous anecdotes, the author makes becoming a wealthy entrepreneur look easy.
7. The Intelligent Investor
Would you like to be the next Warren Buffet? Perhaps, you can start by adopting the strategies his mentor, Benjamin Graham, taught. One of the top finance books of all time with regards to trading, The Intelligent Investor teaches us how to reduce risk and achieve better returns. Originally published over half a century ago, the revised version includes commentary by financial journalist Jason Zweig and draws parallels between today’s reality and Graham’s teachings. In the past, Warren Buffet has admitted that it is “by far the best book on investing ever written.” Graham’s guide to financial forecasts are still relevant even today and used by traders.
An indispensable guide on how to reach your financial goals, Graham offers advice on two different ways of investing – for those who have time on their hands and for others who are busy with many things. For Buffet, the most significant chapters were 8 and 20.
8. The Psychology of Money
Morgan Housel studies how our mindsets influence our financial decisions. One of the most unique books on financial planning, Housel offers deep insights on how emotions and math drive our business decisions. He advises people to get their finances in order because it is the single-most important factor that lets you control your life.
“Use money to gain control over your time, because not having control of your time is such a powerful and universal drag on happiness. The ability to do what you want, when you want, with who you want, for as long as you want to, pays the highest dividend that exists in finance.”
Although people assume that big financial decisions are often made after thorough research and calculations on spreadsheets, Housel reveals that often that is not the case. Money decisions often include multiple factors, from whom you discuss it with to your personal worldview and biases. Armed with 19 short stories that reveal how people think about money, Housel sheds light on what businesses and people must take into account while dealing with money.
9. How Finance Works
If numbers intimidate you, then this is one of the best books on finance to help your case. The author, Mihir Desai, a professor at Harvard Business School, demystifies the world of finance to enable you to make smart financial decisions.
Chockfull of entertaining stories, insightful exercises, and eye-catchy visuals the book is an easy read that helps you unravel the mystery of finance. Both financial professionals and amateurs can find wisdom within its pages as it distills jargons into simple, understandable metaphors. He also teaches us the ins and outs of balance sheets, how different financial levers affect company’s performance, and how value is created, measured, and maximized. Whether you are a business person or a student or a CEO, Desai’s books will help you tackle numbers smartly.
10. Never Split the Difference
A book by an FBI hostage negotiator. Chris Voss has dealt with all kinds of criminals and terrorists during his career, and so he understands exactly how terrifying finance is for some people. In this book, he draws on his experiences as a negotiator and shares the nine effective principles ― counterintuitive tactics and strategies ― that will hold you in good stead when it comes to financial decisions in your life.
Whether it is negotiating a new business contract, buying a home, or getting a mortgage, Voss shows you that life is made up of a series of negotiations. His practical, actionable advice will help you resolve everything from everyday conflicts to highly-charged business dealings.
One of the best financial books, Voss shows us how “conflict brings out truth, creativity, and resolution.” He exhorts his readers to not run away from difficulties but to hold their ground and negotiate well. For business leaders, this book equips them with the intuition and strategies needed to make key financial decisions that will lead their companies to success.
