Business Adventures by John Brooks. A collection of articles that is still as interesting, funny and relevant today as it must have been then. The author doesn’t assault the reader with paradigm shifts, rubrics or lessons learned. He simply presents engaging business stories to be enjoyed. I talked about in a little more detail here.
Forty-five years ago I read “The Only Investment Guide You’ll Ever Need” by Tobias. Despite predating indexing, 401(k)’s, and Roth’s; TOIGYEN imprinted in me the benefits of saving and compounding in an easy to read writing style. The book has been frequently updated with the most recent edition in 2022.
The book was eye opening for me. And one of the surprises was the fact that the authors were contacted by businesses that wished to market to the wealthy but didn’t seem to know who they were or where they lived. It wasn’t just ordinary people who wrongly assumed they were all holed up in the highest priced neighborhoods. The marketing people who reached out to Stanley and Danko also seemed surprised to learn that many millionaires actually lived literally “next door”.
I read Millionaire when I was in my twenties and it made a lasting impression. I dreamed of being a completely unpretentious millionaire someday, driving around in a rusty pick-up truck with clothes from Walmart or Costco. Now I’m 55 and I’m living the dream. Of course, a million bucks ain’t what it used to be and my truck is a 2022 model, so no rust yet.
John Bogle’s “The Little Book of Common Sense Investing.” The vast majority of colleagues/family/friends that I have discussed investing with over the years seem to be convinced that a more “sophisticated” approach to investing (vs thoughtful allocation and indexing) is needed for long term success. Bogle and the numbers prove otherwise.
I agree. I am annoyed whenever I read about “sophisticated” investors, or where the “smart money” is being invested. In recent years, Buffett acknowledged that many high net worth individuals have chosen to not follow his general investing advice, which is to regularly invest in a low cost index fund based on the S&P 500. When asked why they don’t, he answered (and I’m paraphrasing) many wealthy folks generally believe the “best” goods and services, such as hotel rooms, air travel, fine dining, legal and medical advice, and fancy apparel cost significantly more and they are willing pay. This logic leads them to think that such simple sounding advice, already widely known, cannot be the best advice available. And there is no shortage of experts who are happy to supply them with pricey but “better” advice.
Assuming “sophistication” means better investment performance is one of the financial world’s most dangerous myths — a myth Wall Street happily exploits.
I read several investment books before retiring, and as far as doing your own stock picking I would have to second one of Tom Hyland’s picks, Peter Lynches book- “One Up On Wall Street”. He uses easy to understand regular English, but yet goes thru all the details how he picked stocks when he was a top fund manager for Fidelity back in the 70″s and 80’s.
What is the Best Book about Finance? I have read all the books suggested at Humble Dollar, but by far the Best Book was Psychology of Money, by Morgan Housel. I wish it was around in the 1970’s when I was in my 20’s. Check out the chapters and quotes. Fascinating! From book Psychology of Money Timeless lessons on Wealth, Greed, and Happiness A genius is the man who can do the average thing when everyone else around him is losing his mind. Napoleon The world is full of obvious things which nobody by any chance ever observes Sherlock Holmes Chapter 1. No One’s Crazy Your personal experiences with money make up maybe 0.00000001 % of what’s happened in the world, but maybe 80% of how you think the world works 2. Luck & Risk Nothing is as good or as bad as it seems 3. Never Enough When rich people do crazy things 4. Confounding Compounding $81.5 Billion of Warren Buffett’s $84.5 Billion net worth came after his 65th Birthday. Our minds are not built to handle such absurdities. 5. Getting Wealthy vs Staying Wealthy Good investing is not necessarily about making good decisions. It’s about consistently not screwing up 6. Tails, You Win You can be wrong half the time and still make a fortune 7. Freedom Controlling your time is the highest dividend money pays 8. Man in the Car Paradox No one is impressed with your possessions as much as you are 9. Wealth is What You Don’t See Spending money to show people how much money you have is the fastest way to have less money 10. Save Money The only factor you can control generates one of the only things that matters. How wonderful. 11. Reasonable>Rational Aiming to be mostly reasonable works better than trying to be coldly rational 12. Surprise History is the study of change, ironically used as a map of the future. 13. Room for Error The Most important part of every plan is planning on your plan not going according to plan 14. You’ll Change Long-term planning is harder than it seems because people’s goals and desires change over time 15. Nothing’s Free Everything has a price, but not all prices appear on labels 16. You & Me Beware taking financial cues from people playing a different game than you are 17. The Seduction of Pessimism Optimism sounds like a sales pitch. Pessimism sounds like someone trying to help you. 18. When You’ll Believe Anything Appealing fictions, and why stories are more powerful than statistics 19. All Together Now What we’ve learned about the psychology of your own money. 20. Confessions The psychology of my own money.
Thank you for this summary, William. You’ve persuaded me to finally read Housel’s book. I’ve listened to him on podcasts, etc, so I’m familiar with his concepts, but I felt I didn’t really need to actually read the book. Now I think I will, maybe just to feed my confirmation bias, lol.
Following the detailed instructions in Harry Sits “My Financial Toolbox” book and his blog to take simple actions to save money. And using Harry’s advice of “set and forget” and “good enough” to make sure I do not overdo it and forget to enjoy life and my family and friends.
Well, when it comes to “finance” and “investing”, I’ll defer to others. Lots of very savvy people have already contributed great ideas. I might favor Professor Malkiel as I once asked him a detailed question and even though he didn’t know me from Adam, he took the time to answer.
But, in terms of practical, valuable guidance, for everyday personal finance and economic considerations and decision-making, I vote for: Common Sense Economics: What Everyone Should Know About Wealth and Prosperity, written by James D. Gwartney, Richard L. Stroup, Dwight R. Lee, Tawni Hunt Ferrarini, and Joseph Calhoun.
Everyday Americans would be well served by getting a copy of that book, short and to the point, at some time while in high school or as a graduation gift.
What is the Best Book about Finance? I have read all the books suggested at Humble Dollar, but by far the Best Book was Psychology of Money, by Morgan Housel. I wish it was around in the 1970’s when I was in my 20’s. Check out the chapters and quotes. Fascinating! From book Psychology of Money Timeless lessons on Wealth, Greed, and Happiness A genius is the man who can do the average thing when everyone else around him is losing his mind. Napoleon The world is full of obvious things which nobody by any chance ever observes Sherlock Holmes Chapter 1. No One’s Crazy Your personal experiences with money make up maybe 0.00000001 % of what’s happened in the world, but maybe 80% of how you think the world works 2. Luck & Risk Nothing is as good or as bad as it seems 3. Never Enough When rich people do crazy things 4. Confounding Compounding $81.5 Billion of Warren Buffett’s $84.5 Billion net worth came after his 65th Birthday. Our minds are not built to handle such absurdities. 5. Getting Wealthy vs Staying Wealthy Good investing is not necessarily about making good decisions. It’s about consistently not screwing up 6. Tails, You Win You can be wrong half the time and still make a fortune 7. Freedom Controlling your time is the highest dividend money pays 8. Man in the Car Paradox No one is impressed with your possessions as much as you are 9. Wealth is What You Don’t See Spending money to show people how much money you have is the fastest way to have less money 10. Save Money The only factor you can control generates one of the only things that matters. How wonderful. 11. Reasonable>Rational Aiming to be mostly reasonable works better than trying to be coldly rational 12. Surprise History is the study of change, ironically used as a map of the future. 13. Room for Error The Most important part of every plan is planning on your plan not going according to plan 14. You’ll Change Long-term planning is harder than it seems because people’s goals and desires change over time 15. Nothing’s Free Everything has a price, but not all prices appear on labels 16. You & Me Beware taking financial cues from people playing a different game than you are 17. The Seduction of Pessimism Optimism sounds like a sales pitch. Pessimism sounds like someone trying to help you. 18. When You’ll Believe Anything Appealing fictions, and why stories are more powerful than statistics 19. All Together Now What we’ve learned about the psychology of your own money. 20. Confessions The psychology of my own money.
These are the only two books you will ever need to read to be a successful investor: 1 – The Only Investment Guide You’ll Ever Need by Andrew Tobias (Brian Valentine you beat me to it). “A very basic thing to know about your money is that, over the really long run, people who buy equities—stocks—will almost surely make a lot more money (if they’re at all sensible in how they do it) than people who make “safer” investments.” 2 – The Godfather by Mario Puzo. “it’s not personal . . . it’s strictly business”
The first book to turn me onto index investing was Millionaire Expat, by Andrew Hallam. Fantastically simple and evidence based. Really highly recommend this.
By the time I realized I was getting to an age where I was looking forward to retirement, I also realized I had not paid much attention to my financial situation, other than following a detailed budget over the years, and saving what I could. The book I read that had the most influence in getting me on track was Control Your Retirement Destiny, by Dana Anspach. Early in the book, she shows how to make an income timeline. Being a one time CPA and IT & spreadsheet nerd, I loved this idea. I have greatly enhanced my original NPV cash flow timeline, with tabs that include my spending plan (my Quicken budgets), allocation, asset location, tax projections, asset class performance, and many other things. I can see my funded ratio, my buckets, drawdown strategy, etc. It’s all populated automatically with a simple download from Fidelity. It makes keeping tabs on my finances easy and fun. The book totally got me pointed in the right direction!
Your Money or Your Life – Vicki Robin & Joe Dominguez One Up On Wall Street – Peter Lynch The Millionaire Next Door series of books – Thomas Stanley Each one was an eye opener for me.
I’m going to cheat by choosing the collection of shareholder letters that Warren Buffett has written in the annual Berkshire Hathaway reports. I’ve learned more about investing in those letters than in any book.
The Only Investment Guide You’ll Ever Need by Andrew Tobias. Clear, concise, interesting (humorous at times) basic guide to personal finance including investing. Eminently sensible. Recommends sources for more on investing including Malkiel.
I have read a number of the books cited in this thread. No one stands out as “the one”, but collectively they have provided a wealth of wisdom about finances and investments. I believe I have learned more as a frequent reader of Morningstar and Boglehead columns and now Humble Dollar.
Die Broke by Pollan & Levine. Spend your money when you’re on this side of the ground. If I remember correctly: “The last check you write should be for your own funeral, and it should bounce”.
I would include many of the books already listed here among my favorites. However, my most recent favorite Is “Richer, Wiser, Happier: How the World’s Greatest Investors Win in Markets and Life” by William Green. It was so informative and well written that I read it twice in a row! Even the footnotes and the notes on sources and additional resources at the end of the book are a must read.
The Richest Man in Babylon by George S. Clason. Introduced me to the concept of paying yourself first back in 1986. Been following that advice ever since and have reaped the rewards of doing so.
A Random Walk Down Wall Street — I did not read this until I was in my 40s. I just wish someone would have shoved a copy in my hands when I graduated from college. The single best book on how the financial markets work that I have read. All of my kids have received a copy when they graduate.
Every time Professor Malkiel publishes a new edition of A Random Walk Down Wall Street, I purchase a copy to both re-read it and keep up with his latest thinking.
It was one of the first investment books I read. Burt Malkiel, like Jack Bogle, has been hugely responsible for the acceptance and growing popularity of indexing.
For me, the choice of “best” or “most influential” book is related in large part to when I first read it. I started investing in 1988 by simply contributing to my 401-k along with investing in a taxable account. I did not know what I was doing. The first useful books I remember reading were “The Millionaire Next Door” by the late Stanley and Danko in 1996, and the late John Bogle’s “Common Sense on Mutual Funds” in 1999. Bogle, more than any other, probably had the greatest influence on my investing behavior. “The Intelligent Asset Allocator” by Bernstein was a classic work published in 2001, especially for me, a fellow neurologist, who sadly lacks his gift for financial and historical analysis. I have since read more or less everything Bogle and Bernstein have written, as well as most of the other authors cited by contributors to this blog. Warren Buffett’s annual letters are filled with wisdom. I retired three years ago and still learn something every day, and while I will never be a financial expert, I have the tools to make appropriate decisions to manage my portfolio. The one book which I find to be the best now is the Humble Dollar’s “Money Guide”, by Clements, because of its comprehensiveness, lucid writing, continuous updating, and the fact that it is enriched by an endless stream of comments by contributors and readers.
Mostly great comments so far, but I have to put one above the others: Stocks for the Long Run by Jeremy Siegel. Exhaustively researched. Great charts. I refer back to it sometimes to remind myself of certain data points. Makes the case for buying and holding stocks over other asset classes better than any other author.
Buffett The Making of an American Capitalist by Roger Lowenstein because it introduced me to Buffett as a young man. This led me to read more from others and began my self education. Cash Flow Quadrant was great for helping me see concepts I had never heard discussed in high school or among my circle of friends and family.
It was long ago, but a book that really opened my eyes and changed the way I thought about money and investing was The Millionaire Next Door (echoing Stan Wolf). And, while not a book, I’ll also echo Philip Stein regarding Jonathan’s columns in the WSJ. I appreciated the fact that they were were written in such straighforward and non-technical language that a rookie like me could understand and learn from them.
“Seven Habits of Highly Effective People” is still my favorite – not a financial book but helpful for most things in life including finances. I enjoy reading “Your Money or Your Life” (Joe Dominguez / Vicky Robin) every now and then. “How to think about money” is another favorite one. I gave copies to some of my daughter’s friends and also a few young coworkers. They all loved it.
”I Will Teach You To Be Rich” by Ramit Sethi. Book based on common sense (IMHO) but with a focus that only certain things matter such as your housing and transportation costs and that avocado toast or a latte will not stop you from being rich.
Agree with all of the above. Surprisingly Warren Buffett isn’t on my list: he has access to so many private investment deals that aren’t available to regular investors that I felt these were not helpful to read about. I enjoyed reading The Intelligent Investor by Benjamin Graham for principles of value investing; Jason Zweig’s The Little Book of Safe Money has great advice on balanced investing and planning.
I’ve been reading the WSJ daily for 40 years. I started reading it at the college library and it has been a great resource. How else would I have been able to learn from Jonathan? I remember he used to respond to my emails back in the day. Still appreciate that.
RICH DAD, POOR DAD by Robert Kiosaki. Learned to identify assets from liabilities. Changed my thinking on spending & what I was spending on. Also by him, CASHFLOW QUADRANT. Drove home more invaluable points. I was also impressed with THE MILLIONAIRE NEXT DOOR. Very interesting book. Taught me to not believe everything I assumed about others.
I enjoy John Bogle’s “The Little Book of Common Sense Investing”. Beautifully written and really help set the right mindset and framework for being a long term small investor.
I have several favorites but always encourage people to read a variety to get a broader perspective. After reading How To Get Rich and Stay Rich by Fred J. Young, I wrote Mr. Young and he invited me to have lunch. It turns out he married a girl from my hometown of Fort Scott, Kansas. It also turned out that Fred had spent time with Warren Buffett in 1958 and afterwards had lunch with him several times. He never mentioned that in his book. I was fascinated. If I wrote a book about getting rich and knew Warren Buffet, I’d find a way to include that in my book.
I think most readers would agree that becoming a better investor through self-education requires you to read widely. Therefore, it’s hard to identify one great financial book. There are many good ones available from authors like John Bogle, William Bernstein, Burton Malkiel, and, of course, Jonathan Clements.
Having said this, I experienced my greatest education and inspiration from the series of Getting Going columns Jonathan wrote for the Wall Street Journal. I’ve been a long-term subscriber to the Journal and was fortunate to discover Jonathan and his weekly columns when I began trying to educate myself those many years ago. I found his weekly columns to be particularly effective because they were extremely well-written (of course) and were delivered in small doses which made it easier for me to absorb the lessons that needed to be learned. I dutifully cut out the column each week and collected them in a manila folder which eventually grew to about two inches thick. I still peruse these articles from time to time.
One of my most important epiphanies came from one of Jonathan’s earlier columns where he stated that you didn’t have to beat the market to reach your financial goals. This one insight primed me to absorb other important lessons like the need for diversification, the importance of minimizing investment costs, and the advantages of index funds over actively managed funds.
I often thought that it would be wonderful if Jonathan could cherry-pick his best columns from his Wall Street Journal years and assemble them into a book for the benefit of newer generations of investors. My suggested title for such a book: Jonathan Clements Greatest Hits.
I couldn’t agree more with Philip Stein. Jonathan’s column in the WSJ was the first article I read each day for years and years, and by the far the best column I read. I learned more from him than from any of the many wonderful writers who have been mentioned on this page.
Winning the Loser’s Game, by Charlie Ellis. It’s not about winning, but about avoiding mistakes or “forced errors.” It makes a great argument about why trying to beat the markets usually ends up making us poorer.
The best financial book I ever read was The Money Masters by John Train. It’s an old book that I learned about Warren Buffett from before he was very famous.
Berkshire Hathaway was then traded “by appointment” on the Pink Sheets under the symbol BKHT at the outrageous price of $2000 per share.
I did the math and his 16 per cent compound return was unbelievable.
I completely agree. Hands down to the best book. It covers 99% of what one needs to know about finance, is practical, based on factual research and written clearly in just ~150 pages.
It’s the book I find myself recommending the most to those asking me about money and investing.
I’m glad I read through all the comments before replying. The first book that cam e to my mind was also How to Think About Money. The comments reminded me of several others that were also good to great, including The Millionaire Next Door which was influential on me years ago, but the question was about the “best.” That’s still How to Think About Money.
I’m a huge fan of William Bernstein’s The Four Pillars of Investing.
I also like David Swenson’s The Ivy Portfolio, especially the breakdown he does on various asset classes and their suitability for individual investors.
There are many good books out there, a couple that come to mind are How to Make Your Money Last and The Bogleheads Guide to Investing. Much depends on where you are in your investing journey, the right book at the right time can be magic.
Business Adventures by John Brooks. A collection of articles that is still as interesting, funny and relevant today as it must have been then. The author doesn’t assault the reader with paradigm shifts, rubrics or lessons learned. He simply presents engaging business stories to be enjoyed. I talked about in a little more detail here.
Forty-five years ago I read “The Only Investment Guide You’ll Ever Need” by Tobias. Despite predating indexing, 401(k)’s, and Roth’s; TOIGYEN imprinted in me the benefits of saving and compounding in an easy to read writing style. The book has been frequently updated with the most recent edition in 2022.
The Little Book that beats the market by Joel Greenblatt was very enjoyable, brief and highly educational for me.
The Millionaire Next Door. As a teenager it showed me that you could become financially secure no matter what type of career you had.
The book was eye opening for me. And one of the surprises was the fact that the authors were contacted by businesses that wished to market to the wealthy but didn’t seem to know who they were or where they lived. It wasn’t just ordinary people who wrongly assumed they were all holed up in the highest priced neighborhoods. The marketing people who reached out to Stanley and Danko also seemed surprised to learn that many millionaires actually lived literally “next door”.
That is a good one. I need to buy it for my daughter so that she can learn that fancy living is antithetical to being rich one day.
I read Millionaire when I was in my twenties and it made a lasting impression. I dreamed of being a completely unpretentious millionaire someday, driving around in a rusty pick-up truck with clothes from Walmart or Costco. Now I’m 55 and I’m living the dream. Of course, a million bucks ain’t what it used to be and my truck is a 2022 model, so no rust yet.
John Bogle’s “The Little Book of Common Sense Investing.” The vast majority of colleagues/family/friends that I have discussed investing with over the years seem to be convinced that a more “sophisticated” approach to investing (vs thoughtful allocation and indexing) is needed for long term success. Bogle and the numbers prove otherwise.
I agree. I am annoyed whenever I read about “sophisticated” investors, or where the “smart money” is being invested. In recent years, Buffett acknowledged that many high net worth individuals have chosen to not follow his general investing advice, which is to regularly invest in a low cost index fund based on the S&P 500. When asked why they don’t, he answered (and I’m paraphrasing) many wealthy folks generally believe the “best” goods and services, such as hotel rooms, air travel, fine dining, legal and medical advice, and fancy apparel cost significantly more and they are willing pay. This logic leads them to think that such simple sounding advice, already widely known, cannot be the best advice available. And there is no shortage of experts who are happy to supply them with pricey but “better” advice.
Assuming “sophistication” means better investment performance is one of the financial world’s most dangerous myths — a myth Wall Street happily exploits.
The Case for Dividend Growth: Investing in a Post-Crisis World
https://a.co/d/02KDmFGp
This book by David Bahnsen changed the way I invest and provided the goal of living off dividends rather than relying on selling investments.
Get Rich with Dividends by Marc Lichtenfeld. It has been the reason for our very comfortable retirement.
I don’t know about the “best”, but Random Walk and Millionaire Next Door were the most influential to me because I found them when I was a young man.
The Big Short by Michael Lewis. Also, any other book by Michael Lewis.
I read several investment books before retiring, and as far as doing your own stock picking I would have to second one of Tom Hyland’s picks, Peter Lynches book- “One Up On Wall Street”. He uses easy to understand regular English, but yet goes thru all the details how he picked stocks when he was a top fund manager for Fidelity back in the 70″s and 80’s.
William Dorner
1 year ago
What is the Best Book about Finance? I have read all the books suggested at Humble Dollar, but by far the Best Book was Psychology of Money, by Morgan Housel. I wish it was around in the 1970’s when I was in my 20’s. Check out the chapters and quotes. Fascinating!
From book Psychology of Money
Timeless lessons on Wealth, Greed, and Happiness
A genius is the man who can do the average thing when everyone else around him is losing his mind. Napoleon
The world is full of obvious things which nobody by any chance ever observes Sherlock Holmes
Chapter 1. No One’s Crazy
Your personal experiences with money make up maybe 0.00000001 % of what’s happened in the world, but maybe 80% of how you think the world works
2. Luck & Risk
Nothing is as good or as bad as it seems
3. Never Enough
When rich people do crazy things
4. Confounding Compounding
$81.5 Billion of Warren Buffett’s $84.5 Billion net worth came after his 65th Birthday. Our minds are not built to handle such absurdities.
5. Getting Wealthy vs Staying Wealthy
Good investing is not necessarily about making good decisions. It’s about consistently not screwing up
6. Tails, You Win
You can be wrong half the time and still make a fortune
7. Freedom
Controlling your time is the highest dividend money pays
8. Man in the Car Paradox
No one is impressed with your possessions as much as you are
9. Wealth is What You Don’t See
Spending money to show people how much money you have is the fastest way to have less money
10. Save Money
The only factor you can control generates one of the only things that matters. How wonderful.
11. Reasonable>Rational
Aiming to be mostly reasonable works better than trying to be coldly rational
12. Surprise
History is the study of change, ironically used as a map of the future.
13. Room for Error The Most important part of every plan is planning on your plan not going according to plan
14. You’ll Change
Long-term planning is harder than it seems because people’s goals and desires change over time
15. Nothing’s Free
Everything has a price, but not all prices appear on labels
16. You & Me
Beware taking financial cues from people playing a different game than you are
17. The Seduction of Pessimism
Optimism sounds like a sales pitch. Pessimism sounds like someone trying to help you.
18. When You’ll Believe Anything
Appealing fictions, and why stories are more powerful than statistics
19. All Together Now
What we’ve learned about the psychology of your own money.
20. Confessions
The psychology of my own money.
Thank you for this summary, William. You’ve persuaded me to finally read Housel’s book. I’ve listened to him on podcasts, etc, so I’m familiar with his concepts, but I felt I didn’t really need to actually read the book. Now I think I will, maybe just to feed my confirmation bias, lol.
Following the detailed instructions in Harry Sits “My Financial Toolbox” book and his blog to take simple actions to save money. And using Harry’s advice of “set and forget” and “good enough” to make sure I do not overdo it and forget to enjoy life and my family and friends.
Well, when it comes to “finance” and “investing”, I’ll defer to others. Lots of very savvy people have already contributed great ideas. I might favor Professor Malkiel as I once asked him a detailed question and even though he didn’t know me from Adam, he took the time to answer.
But, in terms of practical, valuable guidance, for everyday personal finance and economic considerations and decision-making, I vote for: Common Sense Economics: What Everyone Should Know About Wealth and Prosperity, written by James D. Gwartney, Richard L. Stroup, Dwight R. Lee, Tawni Hunt Ferrarini, and Joseph Calhoun.
Everyday Americans would be well served by getting a copy of that book, short and to the point, at some time while in high school or as a graduation gift.
Accounting 101 (back in college). It provided a foundation for all else.
2 months ago
What is the Best Book about Finance? I have read all the books suggested at Humble Dollar, but by far the Best Book was Psychology of Money, by Morgan Housel. I wish it was around in the 1970’s when I was in my 20’s. Check out the chapters and quotes. Fascinating!
From book Psychology of Money
Timeless lessons on Wealth, Greed, and Happiness
A genius is the man who can do the average thing when everyone else around him is losing his mind. Napoleon
The world is full of obvious things which nobody by any chance ever observes Sherlock Holmes
Chapter 1. No One’s Crazy
Your personal experiences with money make up maybe 0.00000001 % of what’s happened in the world, but maybe 80% of how you think the world works
2. Luck & Risk
Nothing is as good or as bad as it seems
3. Never Enough
When rich people do crazy things
4. Confounding Compounding
$81.5 Billion of Warren Buffett’s $84.5 Billion net worth came after his 65th Birthday. Our minds are not built to handle such absurdities.
5. Getting Wealthy vs Staying Wealthy
Good investing is not necessarily about making good decisions. It’s about consistently not screwing up
6. Tails, You Win
You can be wrong half the time and still make a fortune
7. Freedom
Controlling your time is the highest dividend money pays
8. Man in the Car Paradox
No one is impressed with your possessions as much as you are
9. Wealth is What You Don’t See
Spending money to show people how much money you have is the fastest way to have less money
10. Save Money
The only factor you can control generates one of the only things that matters. How wonderful.
11. Reasonable>Rational
Aiming to be mostly reasonable works better than trying to be coldly rational
12. Surprise
History is the study of change, ironically used as a map of the future.
13. Room for Error The Most important part of every plan is planning on your plan not going according to plan
14. You’ll Change
Long-term planning is harder than it seems because people’s goals and desires change over time
15. Nothing’s Free
Everything has a price, but not all prices appear on labels
16. You & Me
Beware taking financial cues from people playing a different game than you are
17. The Seduction of Pessimism
Optimism sounds like a sales pitch. Pessimism sounds like someone trying to help you.
18. When You’ll Believe Anything
Appealing fictions, and why stories are more powerful than statistics
19. All Together Now
What we’ve learned about the psychology of your own money.
20. Confessions
The psychology of my own money.
The most important thing by Howard Marks
These are the only two books you will ever need to read to be a successful investor:
1 – The Only Investment Guide You’ll Ever Need by Andrew Tobias (Brian Valentine you beat me to it). “A very basic thing to know about your money is that, over the really long run, people who buy equities—stocks—will almost surely make a lot more money (if they’re at all sensible in how they do it) than people who make “safer” investments.”
2 – The Godfather by Mario Puzo. “it’s not personal . . . it’s strictly business”
The Only Investment Guide You’ll Ever Need by Andrew Tobias was one of the first and best I ever read.
The Psychology of Money by Morgan Housal. Probably the only one I’ve reread several times.
The first book to turn me onto index investing was Millionaire Expat, by Andrew Hallam. Fantastically simple and evidence based. Really highly recommend this.
By the time I realized I was getting to an age where I was looking forward to retirement, I also realized I had not paid much attention to my financial situation, other than following a detailed budget over the years, and saving what I could. The book I read that had the most influence in getting me on track was Control Your Retirement Destiny, by Dana Anspach.
Early in the book, she shows how to make an income timeline. Being a one time CPA and IT & spreadsheet nerd, I loved this idea. I have greatly enhanced my original NPV cash flow timeline, with tabs that include my spending plan (my Quicken budgets), allocation, asset location, tax projections, asset class performance, and many other things. I can see my funded ratio, my buckets, drawdown strategy, etc. It’s all populated automatically with a simple download from Fidelity. It makes keeping tabs on my finances easy and fun.
The book totally got me pointed in the right direction!
How To Make Your Money Last, Jane Bryant Quinn and The All-Weather Retirement Portfolio, Randy L. Thurman, CFP, CPA/PFS. Oh and John C. Bogle’s books (your choice).
The Bogleheads’ Guide to the Three-Fund Portfolio: How a Simple Portfolio of Three Total Market Index Funds Outperforms Most Investors with Less Risk
Your Money or Your Life – Vicki Robin & Joe Dominguez
One Up On Wall Street – Peter Lynch
The Millionaire Next Door series of books – Thomas Stanley
Each one was an eye opener for me.
“The Millionaire Next Door” by Stanley and Danko
I’m going to cheat by choosing the collection of shareholder letters that Warren Buffett has written in the annual Berkshire Hathaway reports. I’ve learned more about investing in those letters than in any book.
The Only Investment Guide You’ll Ever Need by Andrew Tobias. Clear, concise, interesting (humorous at times) basic guide to personal finance including investing. Eminently sensible. Recommends sources for more on investing including Malkiel.
No Brainer! Ernie Zelinski’s “Retire wild, happy and free.” Not only did I read it but bought 5 copies to give to friends and relatives.
I have read a number of the books cited in this thread. No one stands out as “the one”, but collectively they have provided a wealth of wisdom about finances and investments. I believe I have learned more as a frequent reader of Morningstar and Boglehead columns and now Humble Dollar.
Die Broke by Pollan & Levine. Spend your money when you’re on this side of the ground. If I remember correctly: “The last check you write should be for your own funeral, and it should bounce”.
I would include many of the books already listed here among my favorites. However, my most recent favorite Is “Richer, Wiser, Happier: How the World’s Greatest Investors Win in Markets and Life” by William Green. It was so informative and well written that I read it twice in a row! Even the footnotes and the notes on sources and additional resources at the end of the book are a must read.
The Richest Man in Babylon by George S. Clason. Introduced me to the concept of paying yourself first back in 1986. Been following that advice ever since and have reaped the rewards of doing so.
Extraordinary Popular Delusions and the Madness of Crowds by Charles Mackay
A Random Walk Down Wall Street — I did not read this until I was in my 40s. I just wish someone would have shoved a copy in my hands when I graduated from college. The single best book on how the financial markets work that I have read. All of my kids have received a copy when they graduate.
Every time Professor Malkiel publishes a new edition of A Random Walk Down Wall Street, I purchase a copy to both re-read it and keep up with his latest thinking.
It was one of the first investment books I read. Burt Malkiel, like Jack Bogle, has been hugely responsible for the acceptance and growing popularity of indexing.
The Single Best Investment – Lowell Miller
https://mhinvest.com/umbraco/api/MHIAPI/GetDocumentByName?docName=SBI_Single_Best_Investment_Miller.pdf
For me, the choice of “best” or “most influential” book is related in large part to when I first read it. I started investing in 1988 by simply contributing to my 401-k along with investing in a taxable account. I did not know what I was doing. The first useful books I remember reading were “The Millionaire Next Door” by the late Stanley and Danko in 1996, and the late John Bogle’s “Common Sense on Mutual Funds” in 1999. Bogle, more than any other, probably had the greatest influence on my investing behavior. “The Intelligent Asset Allocator” by Bernstein was a classic work published in 2001, especially for me, a fellow neurologist, who sadly lacks his gift for financial and historical analysis. I have since read more or less everything Bogle and Bernstein have written, as well as most of the other authors cited by contributors to this blog. Warren Buffett’s annual letters are filled with wisdom. I retired three years ago and still learn something every day, and while I will never be a financial expert, I have the tools to make appropriate decisions to manage my portfolio. The one book which I find to be the best now is the Humble Dollar’s “Money Guide”, by Clements, because of its comprehensiveness, lucid writing, continuous updating, and the fact that it is enriched by an endless stream of comments by contributors and readers.
Unconventional Success by David Swensen.
His advice kept me out of bonds (except for TIPS) and for that I am grateful.
This is definitely in my top 5.
A Simple Path to Wealth
Mostly great comments so far, but I have to put one above the others: Stocks for the Long Run by Jeremy Siegel. Exhaustively researched. Great charts. I refer back to it sometimes to remind myself of certain data points. Makes the case for buying and holding stocks over other asset classes better than any other author.
Buffett The Making of an American Capitalist by Roger Lowenstein because it introduced me to Buffett as a young man. This led me to read more from others and began my self education. Cash Flow Quadrant was great for helping me see concepts I had never heard discussed in high school or among my circle of friends and family.
I also really enjoyed the Buffett book by Lowenstein. I just might re-read it now.
A Random Walk Down Wall Street by Burton Malkiel.
It was long ago, but a book that really opened my eyes and changed the way I thought about money and investing was The Millionaire Next Door (echoing Stan Wolf). And, while not a book, I’ll also echo Philip Stein regarding Jonathan’s columns in the WSJ. I appreciated the fact that they were were written in such straighforward and non-technical language that a rookie like me could understand and learn from them.
“Seven Habits of Highly Effective People” is still my favorite – not a financial book but helpful for most things in life including finances. I enjoy reading “Your Money or Your Life” (Joe Dominguez / Vicky Robin) every now and then. “How to think about money” is another favorite one. I gave copies to some of my daughter’s friends and also a few young coworkers. They all loved it.
”I Will Teach You To Be Rich” by Ramit Sethi. Book based on common sense (IMHO) but with a focus that only certain things matter such as your housing and transportation costs and that avocado toast or a latte will not stop you from being rich.
Agree with all of the above. Surprisingly Warren Buffett isn’t on my list: he has access to so many private investment deals that aren’t available to regular investors that I felt these were not helpful to read about. I enjoyed reading The Intelligent Investor by Benjamin Graham for principles of value investing; Jason Zweig’s The Little Book of Safe Money has great advice on balanced investing and planning.
I’ve been reading the WSJ daily for 40 years. I started reading it at the college library and it has been a great resource. How else would I have been able to learn from Jonathan? I remember he used to respond to my emails back in the day. Still appreciate that.
RICH DAD, POOR DAD by Robert Kiosaki. Learned to identify assets from liabilities. Changed my thinking on spending & what I was spending on. Also by him, CASHFLOW QUADRANT. Drove home more invaluable points. I was also impressed with THE MILLIONAIRE NEXT DOOR. Very interesting book. Taught me to not believe everything I assumed about others.
I enjoy John Bogle’s “The Little Book of Common Sense Investing”. Beautifully written and really help set the right mindset and framework for being a long term small investor.
I have several favorites but always encourage people to read a variety to get a broader perspective. After reading How To Get Rich and Stay Rich by Fred J. Young, I wrote Mr. Young and he invited me to have lunch. It turns out he married a girl from my hometown of Fort Scott, Kansas. It also turned out that Fred had spent time with Warren Buffett in 1958 and afterwards had lunch with him several times. He never mentioned that in his book. I was fascinated. If I wrote a book about getting rich and knew Warren Buffet, I’d find a way to include that in my book.
I think most readers would agree that becoming a better investor through self-education requires you to read widely. Therefore, it’s hard to identify one great financial book. There are many good ones available from authors like John Bogle, William Bernstein, Burton Malkiel, and, of course, Jonathan Clements.
Having said this, I experienced my greatest education and inspiration from the series of Getting Going columns Jonathan wrote for the Wall Street Journal. I’ve been a long-term subscriber to the Journal and was fortunate to discover Jonathan and his weekly columns when I began trying to educate myself those many years ago. I found his weekly columns to be particularly effective because they were extremely well-written (of course) and were delivered in small doses which made it easier for me to absorb the lessons that needed to be learned. I dutifully cut out the column each week and collected them in a manila folder which eventually grew to about two inches thick. I still peruse these articles from time to time.
One of my most important epiphanies came from one of Jonathan’s earlier columns where he stated that you didn’t have to beat the market to reach your financial goals. This one insight primed me to absorb other important lessons like the need for diversification, the importance of minimizing investment costs, and the advantages of index funds over actively managed funds.
I often thought that it would be wonderful if Jonathan could cherry-pick his best columns from his Wall Street Journal years and assemble them into a book for the benefit of newer generations of investors. My suggested title for such a book: Jonathan Clements Greatest Hits.
I couldn’t agree more with Philip Stein. Jonathan’s column in the WSJ was the first article I read each day for years and years, and by the far the best column I read. I learned more from him than from any of the many wonderful writers who have been mentioned on this page.
Many thanks for the (overly) kind words.
Winning the Loser’s Game, by Charlie Ellis. It’s not about winning, but about avoiding mistakes or “forced errors.” It makes a great argument about why trying to beat the markets usually ends up making us poorer.
My favorite investment book is Where are the Customer Yachts by Fred Schwed. It is both funny and profound.
The best financial book I ever read was The Money Masters by John Train. It’s an old book that I learned about Warren Buffett from before he was very famous.
Berkshire Hathaway was then traded “by appointment” on the Pink Sheets under the symbol BKHT at the outrageous price of $2000 per share.
I did the math and his 16 per cent compound return was unbelievable.
I’ll have to check this book out.
That was one of the first investment books I ever read — full of colorful characters. Wall Street seems a little more bland today.
So many good ones I’ve learned from but if I had to pick ONE book, it would be How to Think About Money by Jonathan Clements.
I completely agree. Hands down to the best book. It covers 99% of what one needs to know about finance, is practical, based on factual research and written clearly in just ~150 pages.
It’s the book I find myself recommending the most to those asking me about money and investing.
I’m glad I read through all the comments before replying. The first book that cam e to my mind was also How to Think About Money. The comments reminded me of several others that were also good to great, including The Millionaire Next Door which was influential on me years ago, but the question was about the “best.” That’s still How to Think About Money.
Awww shucks.
The Millionaire Next Door
I’m a huge fan of William Bernstein’s The Four Pillars of Investing.
I also like David Swenson’s The Ivy Portfolio, especially the breakdown he does on various asset classes and their suitability for individual investors.
There are many good books out there, a couple that come to mind are How to Make Your Money Last and The Bogleheads Guide to Investing. Much depends on where you are in your investing journey, the right book at the right time can be magic.