Ride Your Money Wave

Reading List

March 14, 2018

Did you know Warren Buffett, the second richest man in the world, doesn't have a phone or computer in his office?  Instead, he spends up to 8 hours a day just reading.  According to Thomas Corley, 85% of self-made millionaires read two or more books per month.  Wondering where to start?  Below are some of my favorite books that have shaped the way I think and my relationship with money.  

 

 The Automatic Millionaire

This is the book that started it all for me.  I read this book when I was 21 years old and it confirmed my belief that I could become rich.  Better yet, it showed me the way.  You can easily read this book in a weekend.  I love this book so much that I actually give it away as a graduation gift to high school and college graduates.  It is just that good and helpful.  

 

The Millionaire Next Door

 

When I first started to get serious about my financial future, I knew that I wasn't Wall Street material.  I knew I wasn't going to get rich based on my intellect or math skills.  I knew there was more than one way to become wealthy, but all wealthy people had to have something in common.  As it turns out, they have a lot in common.  They think differently, act differently, and live differently.  This book opened my eye to the idea that wealth is not what you see, it is what you don't see...and that anyone can achieve it.  

 

The Millionaire Mind

 

 

Once I read "The Millionaire Next Door," I was convinced in the belief that the key or foundation to becoming wealthy was thinking differently.  Wealth people think differenly than the Average Joe or poor people.  Change the way you think; change your life.  It is just that simple.  Luckily, Thomas Stanley's classic walks you through how wealth people systematically think differently. 

 

Predictably Irrational 

 

Dan Ariely quickly became one of my favorite authors after reading this book.  Since then, I have read everything Dan has published.  It is just that thought provoking.  One of the tenets of economics is that people are rational.  As it turns out, we are predictably irrational.  While reading this book, I shocked, humbled, and enlightened as I saw my own behaviors explained to me.  A must read!

 

Dollars and Sense

 

 

 

Speaking of Dan Ariely, his lastest book continues with the theme of how our brains oftentimes trick us but puts it in the framework of money and our financial decisions.  I fully believe that becoming wealthy is more about your behavior than it is your paycheck and this book supports that point.  Another must read from Ariely.  It quickly has become one of my favorite books.  

 

The Behavior Gap

 

This is one of the rare books I borrowed from the library and wish I bought it (I like to mark my books up when I read them.)  Come to think of it, I shoudl buy this book and read it again.  Like Ariely's books, it explains how often times our baised and irrational behaviors get in the way of us making good decisions.  One of the seeingly trivial but very impactful things about this book are the "bar napkin" graphs  and charts the author uses to help explain the topics.  Seeing it laid out in such simple terms really helps the content sink in.  This is another one I strongly recommend if you are interested in the behavior side of saving and investing.  

 

The Elements of Investing

 

I am always looking for easy yet comprehensive and informational reads to either share with people just starting on their financial journey, or to find some sort of nugget of information that unlocks a new idea or way of thinking for me.  This book does both.  It is a great book that can be read in a few hours.  While it is a shorter book in length, it doesn't lack depth at all.  It takes the reader from savings tips all the way through index funds, various investing accounts, diversification, and more.  The best part is, all of the information is backed up by statistics to really drive the point home.  

 

The Little Book of Common Sense Investing

 

You should read anything you can get your hands on by John Bogle.  He is just that influential.  The guy invented the index fund.  Need I say more?  

 

Enough

 

Speaking of Bogle, Enough is a great and easy read that not only covers a investing information, but is also encourages the reader to pause and reflect on their definition of success in today's modern age.  With attaining wealth becoming easier and easier, largely thanks to Bogle's invention of the index fund, Bogle talks about what his measure of success in life is and how we can write our own definition.  Life is no longer meant to chase money, but do use money as a tool to live our best life.  An informational and reflective read that will help you become a more well-rounded millionaire.

 

A Random Walk Down Wall Street

 

This book changed my life.  Plain and simple.  In full disclosure, I would not have read it if it wasn't assigned to me, but boy am I glad it was.  This book is really divided into three parts: history of stock markets and bubbles, the differences between index vs. mutual funds, and the statistics behind why taking a buy-and-hold approach to index funds is the best way of investing.  This book gave me the confidence to part from my financial advisor and start managing my investments on my own.  While other books cover the same material, this book gives you the knowledge and developes an appreciation to the diversified index fund approach.  If you are serious about investing, this need to be in your library.  Top 3.

 

A Bogleheads' Guide to Investing

  

This book is the bible of investing.  The earlier chapters of the book tout the advantages of being an index investor.  Even if you are committed to this approach, it is always refreshing to see the statistics and remind yourself that it is the best way to invest for the long haul.  The later chapters start to get more into the strategy of investing - different accounts, tax laws and strategies, types of bonds, and more.  I keep this one on my shelf and review some of the later chapters whenever I need to rebalance my portfolio or anter into a new phase in my financial life.  Every investor should have this in their library to serve as a reference guide.  

 

A Bogleheads' Guide to the Three Fund Portfolio

 

While it isn't expected to hit the book shelves until June 2018, this book continues with the Bogleheads' series.  I anticipate it to be a good one and plan on picking it up when it comes out.  

 

 

I Will Teach You To Be Rich

 

 

I love skiing and am a huge skier.  I brought this book with me on an epic trip to Jackson Hole, WY.  I thought the likelihood of me reading while skiing at one of the Meccas of the sport was pretty low.  I was wrong.  Ramit Sethi takes an aggressive and sometimes humorous approach to becoming wealthy.  While he covers the basics about investing, he also talks about how to become a better negotiator and points out better ways to think about money.  Sethi has since gone on to grow a series of businesses catering to entrepreneurial education. 

 

The Effortless Entrepreneur

 

While not an investing book, this book is one of my favorites.  Two guys, an old beat up pickup truck, and an idea.  Fast forward and now they own College Hunks Hauling Junk.  They talk about all the mistakes they made, what they wish they had known starting a business, and provide some real insight into what it takes to be a successful startup.  My copy has plent of markings, scribbles, and thoughts jotted down in the margins.  It isn't considered a "classic" by the New York Times or literary critcs, but it is a great book if you are wondering how to start a business.  It is the perfect blend of reading a story while learning along the way.

 

How to Fail at Almost Everything and Still Win Big

 

 

 

Scott Adams is the creator of the classic comic strip Dilbert.  Even if you don't work in corporate America, you can appreciate the chracters and humor.  While this book isn't about investing, it is about utilizing your skills to become successful.  What makes this book so special is Adam's take on his own success.  He goes through and explains all the skills he is mediocre at.  No single one of those skills would allow him to make a living.  However, by connecting random (and often times sub-par) skills, he was able to become incredibly successful.  At a few points, the book becomes a bit redundant (it could be trimmed probably 20 pages), but overall it is worth the read and changed the way I viewed my own skills and how to acquire success.  No longer do I need to be the absolute best at something, but rather anough "good enoughs" will turn into something great.  The same is true with investing.  By having enough "good enough" years of 8% returns over the long haul, you will have a great retirement account.  My favorite insight he provides is that every skill you acquire doubles your odds of success.  A witty, fun, and insightful read.    

 

10 1/2 Things No Commencement Speaker Ever Said

 

Following on the same thread of witty and insightful lessons on life is Charles Wheelen's book, 10 1/2 Things No Commencement Speaker Ever Said.  Even if you have long since graduated from high school or college, Wheelen challenges conventional thinking and encourages the reader to question his actions, reasons, and journey.  He talks a lot about success, what it takes, and the journey you are on.  It is a short read but incredible insightful.  This should be required reading on January 1st of every year.  It is that reflective.  

 

Barking Up The Wrong Tree

 

This was my favorite book of 2017.  I put this book up there with Freakonomics and Predictably Irrational.  We live in a world where we are constantly encouraged to unhealthily question ourselves, our personalities, and our traits.  I know for years, I thought that extroverts were more successful and that I would struggle because I am naturally an intorvert.  (Read Susan Cain's Quiet for more on that.)  Eric Barker's book complete disects and upends any idea about what you thought it takes to be successful.  I couldn't put this book down and walked away with a much better udnerstanding of how to utilize unique personality traits that I have to increase my chances of success.   A must read. 

 

Rich Dad Poor Dad

 

This book is a classic; however, I didn't enjoy reading it as much as I thought I would.  Perhaps it was because I read it years ago or perhaps it was because I had my hopes up really high at the time that someone reading the book would increase my bacnk account overnight.  Regardless, it is a classic for a reason.  Robert Kiyosaki explains how he learned about money from two polar opposites - his poor dad and his friend's rich dad.  Like the books mentioned before, weath begins with your attitude and relationship with money.  Kiyosaki goes on to explain how and why rich people buy assets.  Overall, it is a good book but nothing that isn't covered in other books as well. 

 

 

Your Life or Your Money

 

 

Several years ago, my cousin swore by this book and told me to pick it up.  I didn't.  It sat on my Amazon Wish List for years.  I finally got around to reading it and understand why it changed the way she views money.  Vicki Robin equates money to life energy.  Now hold on, don't skip over this just yet.  What she really means by "life energy" is to measure your purchases in terms of how many hours you have to work to consume that good or service.  In doing so, you begin to realize that many of the purchases we make aren't worth it.  Viewing purchases in those terms encourages us to rethink and reprioritize how we spend our money.  It turns out, people and experiences, not things, bring us the most joy and life satisfaction.  The good news is, those are normally free!  Overall, the book encourages to look at money more holistically.

 

The Index Card: Why Personal Finance Doesn't Have to Be Complicated

 

I love this book.  Sometimes the simple answer is the best answer.  That is what happened when University of Chicago Professor Harold Pollack was being interviewed and mentioned that all you need to know about finance can fit on an index card.  He filled the card with a few rules to prove his point and posted it online to help others.  It went viral.  The best part is, everything on that card is simple and true.  You don't need to have a Ph.D from the University of Chicago to understand and benefit from the teachings of this book.  

 

Naked Economics

 

It is very difficult to say that a book about economics is interesting; however, Wheelen makes this an easy and interesting read by weaving in real world examples, stories, history, wit, and a bit of sarcasm.  While there is only one chapter on finances (and it doesn't go into any strategy behind it), this is a fanstastic book that explains how the economy (and hence, the world) works.  I assign this book to all of my economics students for summer reading.  I know, I am that teacher.  

 

Meditations

 

Why is there a book from a dead emperor and his thoughts on this list?  Because Marcus Aurelius is a stoic and has some great insight about the meaning of life and how to control your emotions.  I have kept this book on my night stand for several years now and read a page from time to time and simply reflect on a few lines before heading to bed.  It is a deep, insightful, and easy read that has stood the test of time.  

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