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Jeffrey K. Actor

I’VE BEEN SAVING almost my entire adult life. Early on, three books put me on the path to financial success, helping me to reevaluate how I was living.

The first was The Automatic Millionaire by David Bach. This introduced me to the concept that small, automated savings could lead to big results, thanks to compounding over long periods. Albert Einstein reportedly said, “Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.” While some people question whether Einstein said this, Bach’s book put the truth of this concept into focus for me.

Dave Ramsey’s The Total Money Makeover provided a step-by-step plan for achieving my long-term goals. His seven baby steps offered a path that almost anyone could follow. He emphasized living well beneath your means, while devoting savings to paying off all debt—except mortgage debt—before then turning to investing.

His principles were a roadmap to financial stability. Paraphrasing Ramsey, live like no one else now so you can live like no one else later. Following his seven baby steps, plus the small changes in daily spending advocated by Bach, would form the foundation of my financial success.

The Millionaire Next Door, by Thomas J. Stanley and William D. Danko, was the most influential of my three early reads. It presents research showing that most wealthy Americans live middle-class lives, preferring a Camry to a Porsche. As a scientist, the book offered data that were analyzed in a way that I could understand. The Millionaire Next Door was proof that, to be affluent, you don’t have to be seen by others as rich.

Instead, what matters is that you’re comfortable with your spending habits, regardless of how others perceive your financial status. The book’s key message: It’s not how much you earn but how much you save that matters most. As Benjamin Franklin reportedly said, “Money makes money. And the money that money makes, makes money.”

While I’m grateful to have read these three books when I first started my money journey, I’ll admit to having reservations about wholeheartedly accepting all their ideas as doctrine. The books were a solid starting point for me, a way to whet my appetite for financial knowledge and to formulate my own ideas on wealth management. They do have one deficiency, however.

Following their advice too closely during my early years limited my spending. As I near full retirement, I find myself asking whether my overzealous saving cost me experiences when I was younger.

I want my money to last as long as I do. There’s no expiration date stamped on my foot. Yet I wonder now if I saved too much at the expense of enjoying life. Only time will tell.

What’s the best financial book you’ve ever read? Share your thoughts in HumbleDollar’s Voices section.

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