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Hopefully, you have some relaxing moments scheduled by the pool or beach this Memorial Day weekend, or later this summer, to enjoy a good book. If improving your finances is a goal of your summer reading, here are five easy-to-read books we recommend enjoying. All of these books can be consumed by folks brand new to financial concepts, and they each also inspire the reader to take action without being overwhelming.
1. Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence by Vicki Robin and Joe Dominguez
Why we love it: Your Money or Your Life takes the reader step-by-step through eye-opening calculations like how to compute your real hourly wage and how to create a Wall Chart to visualize the difference between your income and expenses. While this sounds like a lot of math, the book still feels like an inspirational and light read because it relentlessly draws the reader’s focus back to purpose. If you get through the book on the first read without finding a single way in which you are thoughtlessly using time or money in an unintentional manner, your optimization is admirable.
Favorite quotes:
“‘More is better’ turns out to be a formula for dissatisfaction. If you live for having it all, what you have is never enough. In an environment of more is better, ‘enough’ is like the horizon—always receding. You lose the ability to identify that point of sufficiency at which you can choose to stop.”
“Indeed, some people would say that once we’re above the survival level, the difference between prosperity and poverty lies simply in our degree of gratitude.”
“We cannot let our lives be ‘dreams deferred,’ as Langston Hughes wrote in his famous poem, ‘Harlem.’ It’s time to let your dreams speak—even as you still have to put food on the table and pay off debts. Dreaming once again does not mean absolving ourselves of financial responsibilities. It means reviving our dreams as juice for the journey.”
2. I Will Teach You to Be Rich: No Guilt. No Excuses. No B.S. Just a 6-Week Program That Works by Ramit Sethi
Why we love it: If you are on a journey to overhaul your financial wellbeing this summer, this is your book. I have never read a financial literacy book with more actionable steps to solve every financial issue. Ramit Sethi can get you out of debt, improve your credit score, help you invest, negotiate your salary, and more in a book that will easily fit in your carry-on luggage. He even specifies which banks he would open particular accounts, which credit cards he would use, and what scripts he uses to negotiate. Since rates at banks change, Ramit Sethi’s website shows the latest on topics like the best credit cards to have or the best places to open a high-yield savings account today. I will add a disclaimer as I do with any Ramit Sethi resources: He is by far the best for those who need to take action now, but he is direct, blunt, and not for anyone who wants to make excuses. (See a flavor for the no-B.S. tone in the quotes below.)
Favorite quotes:
“But I have no sympathy for people who complain without a plan. And a plan means that if you’re in debt, you should know how much you owe and the exact day your debt will be paid off. Almost nobody does.”
“Americans today, compared to the 1950s, seem less happy, even though we eat out twice as much and own two times as many cars. We have so many more toys, like big-screen TVs, smartphones, and microwaves. But that isn’t leading to a more satisfying life.”
“In reality, give me ten minutes with your calendar and your spending, and I’ll show you your actual priorities—and how to fix them.” (Can you see why Xa is a Ramit Sethi fan?)
“When you hit the point of financial independence, you’re being paid to live because of decisions you made years ago.”
“Tax Truth #4: People get really angry about how their taxes are spent but actually have no goddamn idea where the money goes.” (Can you see why Patrick is a Ramit Sethi fan?)
Bonus Material: Ramit Sethi recently starred in the Netflix series How to Get Rich. The eight-episode series shows that income level is not the main determinant of financial stress, as Ramit Sethi works with folks making $30k annually and those making $25k monthly in child support. Some of the stories will probably feel a bit unrelatable, but that is part of the point: Anyone can struggle with their finances, and understanding your financial situation is the first step to improving it. As Ramit Sethi notes in his book, “About one in four people who make $100,000-plus a year still report living paycheck to paycheck[.]”
3. Quit Like a Millionaire: No Gimmicks, Luck, or Trust Fund Required by Kristy Shen and Bryce Leung
Why we love it: Socioeconomic mobility is easier or more difficult depending on your privileges and socioeconomic status at birth, but Kristy Shen shows that you can retire as a millionaire by age 31 after being born into extreme poverty. Kristy and Bryce are still in their 30s, two millennials who maximized their finances, lived frugally, and used geoarbitrage to make world travel a tool of frugality. We love this book because it is so transparent. Kristy and Bryce share their numbers throughout their journey to achieve FIRE, update with how their first year of early retirement worked (spoiler alert: their net worth increased), and discuss early retirement issues like rebalancing portfolios to account for different rates of growth among assets. This book has the inspiration and the math to encourage you to achieve FIRE as early as you want and tell you specifically how to do it.
Favorite quotes:
“But one of the biggest lies we’ve been sold is that following our passion is the key. Statistically, following your passion will lead to unemployment or underemployment. Those of us who grew up poor know that we’re unlikely to wake up excited each day when we’re worried about where the next meal is going to come from or whether we’ll have to choose between electricity and hot water this month.” In the same theme: “Doing what you love and hoping for money to follow is risky. Follow the money first, and you can do what you love later.”
“The more stuff people owned, the unhappier and more stressed they tended to be. Conversely, the less stuff people owned and the more they spent on experiences like travel or learning new skills, the happier and more content they were.”
“The lower and middle classes are obsessed with adding to their wealth: getting an education or higher-paying job, that kind of thing. Rich people are obsessed with growing their wealth. They generally don’t talk about how much they make as a dollar amount, but rather as a percentage of their net worth.”
“The Freedom Mind-set shifts your thinking, from money being the most important to freedom being the most important. Once your needs are taken care of, the next step shouldn’t be hoarding. It should be getting your time back.”
Why we love it: Scott Trench is another millennial with his own creative approach to achieving financial independence at a young age. His approach accepts more risk than Kristy Shen and Bryce Leung, and his ideas around house-hacking and entrepreneurship, that eventually landed him the job of CEO of BiggerPockets at age 30, will appeal to the ambitious. While Scott Trench accepts more risk, he does not blindly take risks: His approach is calculated, logical, and based in math. This book also takes on a lot of issues we encounter as our wealth grows including inequity and the differences between high-income individuals and wealthy individuals. If you are early in your financial journey and anticipate using real estate or entrepreneurship as a tool to accumulate wealth, this book is your starting point.
Favorite quotes:
“If you can easily get by on significantly less income than you currently earn, you open yourself up to an entire world of possibilities or opportunities. Some people call this luck—and only the financially prepared are in a position to get lucky.”
“The guys who are starting businesses, building empires, growing portfolios, traveling the world, and succeeding by all conventional measures of success aren’t doing so by being smarter than the average person. They are winning because they are playing a game where the possibility of success actually exists! It’s a game where they have at least a little control over their workday and productivity! Play that game! Not the one where winning means making your boss laugh.”
“Pursue opportunity, not stability. Stability is ensured by your continually lengthening financial runway, not by an employer’s cushy benefits package.”
“[I]n this book wealth is respected first and foremost for its ability to buy choice.”
“Cash flow positive lives result in ever-decreasing independence on others and lower tolerance for boring/ineffective work. They desire and seek out rewarding and engaging challenges in life.”
5. Die With Zero: Getting All You Can from Your Money and Your Life by Bill Perkins
Why we love it: Bill Perkins provides the macro explanation of why you should care about your money. This book should not be your one money book of the summer if you still need to get through the basics, but it is a terrific second read to start thinking about how you will use your wealth to live your ideal life. At a point, we should look to start spending our money rather than earning more than we can ever spend, particularly if our income relies on trading time for money. We only get so much time, and Bill Perkins wants to teach you how to trade just enough time for money to optimize your life happiness by balancing money, health, and time.
Favorite quotes:
“[Y]ou should put some serious thought and effort into planning the kinds of experiences that you want for yourself. Without that kind of deliberate planning you’re bound to just follow our culture’s well-trodden, default path through life—to coast on autopilot. You’ll get to the destination (death) but probably without having the kind of journey you would have actively chosen for yourself.”
“Invest in your life’s experience—and start early, start early, start early.”
“Making deliberate choices about how to spend your money and your time is the essence of making the most of your life energy.”
“If you spend hours and hours of your life acquiring money and then die without spending all of that money, then you’ve needlessly wasted too many precious hours of your life.”
Conclusion
Any reading that furthers your financial literacy will help you build a more informed financial future. There are many books we love that did not make the list, including some that are simply a bit much for beach reads for many folks. No matter where you are on your financial journey or how you best consume new information, keep learning about your finances and enjoy your summer reads!
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