Written by: Corey Janoff
Summer is here and everyone needs some good books to read while on summer vacation (or staycation – it is 2020 after all, #COVID). This is my third installment of recommend books to enhance your financial education.
If you haven’t already done so, I encourage you to peruse my previous finance book recommendations: Financial Book list 1, Financial Book list 2. Those books, especially the ones in the first list, will give you a great foundation for improving your personal finances.
You have probably noticed that none of the books I recommend have get-rich-quick hacks or double-top-secret investment tips. You know why? Those types of books are useless and misleading. As it turns out, the best investment advice and tips for getting rich are quite boring. You don’t even need a full book to cover it all. It can be summed up pretty concisely – work hard, spend less than you earn, invest the difference.
So why do I even bother putting together a list of recommended books? For starters, some people enjoy reading books. Also, even if you can distill the broad message down to a single sentence, the message can be strengthened with data, examples, and stories.
I, like all humans, have internal biases. I prefer books that don’t try to sell you on the B.S. that you have to read this book to learn the secret to success. When it comes to books that further financial education, I enjoy books that are interesting, thought-provoking, inspiring, easy to follow, and incorporate the psychological aspects of personal finance.
The numbers and math in personal finance is quite simple. I believe, and there is a lot of research to back me up, that a person’s mindset is the key to achieving their financial goals. The psychology of money is fascinating. The ability to recognize one’s biases, remain disciplined, and not succumb to the adverse consequences of comparing yourself to others are keys to achieving financial independence.
With that being said, here are five books I have read recently that I believe can improve your education in personal finances and help you achieve your financial goals.
1. The Millionaire Mind, by Thomas Stanley
The Millionaire Mind is a great follow-up to The Millionaire Next Door (which appeared on my original recommended financial reading list). It touches on many of the same themes. While The Millionaire Next Door is essentially a long research paper on the common traits of millionaires, The Millionaire Mind takes a deeper dive into those characteristics. Stanley even takes it a step further, sending surveys out to thousands of these millionaires to uncover qualitative characteristics, in addition to the more objective quantitative ones he already uncovered. To see how well you match up with the characteristics of millionaires in the country, or learn some characteristics you should embrace, dive into The Millionaire Mind.
2. Financial Planning Basics for Doctors, by Marshall Weintraub
In early 2019, Marshall Weintraub, along with some of our other partners, published Financial Planning Basics for Doctors; the first official book from Finity Group. This is a great step-by-step guide for financial planning for physicians. The target audience is young doctors looking to get their financial house in order. If you are in med school, residency, or a younger doctor in practice, this book is for you! It walks through specific topics doctors face, including student loans, home buying, disability insurance, college savings, estate planning, retirement planning, investing, and more. You can purchase on Amazon or schedule an initial financial planning meeting with one of our advisors, as clients can request a free copy 😉.
3. Predictably Irrational: The Hidden Forces That Shape Our Decisions, by Dan Ariely
Dan Ariely is a psychology professor at Duke University who suffered horrific burn injuries from an explosion as a teenager. He writes about his experience in the burn department in the hospital where he dealt with a variety of irrational behaviors that were part of the routine treatment protocol. This was the catalyst to his career as a psychologist and research on irrational behavior. He has uncovered that many irrational behaviors are quite predictable. Much of Predictably Irrational circles around irrational economic decisions we make in our daily lives. These factors can have far reaching implications in our personal finances. Being aware of the potential pitfalls can hopefully help you avoid them. His writing style is entertaining and amusing, while being very informative.
4. Grit: The Power of Passion and Perseverance, by Angela Duckworth
Many of you have probably heard of the book Grit, or seen Angela Duckworth’s TED Talk. Duckworth is another psychologist on my reading list. Grit doesn’t have any specific financial examples, like the other books on my list have, but it’s message can help you achieve your financial goals. Grit is the intersection of passion and perseverance. How interested are you in achieving something? How bad do you want it? Hard work and persistence are keys to achieving your financial goals. The ability to power through challenges, rather than giving up. The grittiest people are likely to be the most successful at achieving their goals.
5. The Undoing Project by Michael Lewis
Michael Lewis is probably the most well-known author on my three reading lists (author of Moneyball, The Big Short, The Blind Side, and many other bestsellers, along with the podcast, Against the Rules). His book, The Undoing Project: A Friendship That Changed Our Minds is about the friendship between Daniel Kahneman and Amos Tversky. Kahneman and Tversky are the Nobel Prize winning psychologists who discovered many of the irrational tricks our mind can play on us. Much of their work has economic ramifications and focuses on decisions we make about money. That probably explains why two psychologists won a Nobel Prize in economics! Kahneman’s book, Thinking Fast, and Slow was on one of my previous recommended reading lists. Lewis’s book is a great summary of some of their careers and key findings, as well as a biographical look behind the curtain of the friendship between the two.
Happy Reading!
Hope you find something that interests you from this selection. Here’s to good books that can help you achieve your financial goals!
