If you’re young and you’ve recently started your first “real job” you might be going through a scenario that I went through a few years ago. I wanted to know how to grow the money I was earning from my job. I had very little knowledge other than a few quick things I’d read online.
I made a few stupid investments, trying to chase big returns and “get rich” quickly. Then I decided it was time to educate myself and make smart money decisions. These are a few of the books that really made a difference in how I make decisions about money.
I first came across Ramit Sethi on The Tim Ferris Show podcast. He discussed his main principles for generating wealth, managing money, and investing intelligently. Sethi’s book I Will Teach You To Be Rich is a step by step guide to achieving financial freedom.
The finance industry is littered with gurus who claim to have the best method for quick gains in the stock market, or which cryptocurrency is the next one to explode in price. Sethi is a welcome voice of reason when it comes to investing for the long-term, prioritizing certain financial goals, and optimizing your career.
Ramit Sethi’s Key Points
- Establish a Good Credit History
- Manage Your Debt
- Establish Emergency Savings Fund
- Start Investing As Soon as Possible
- Track your spending. Spend Consciously.
- Automate Your Saving and Investing
- Invest Intelligently
- Maximize Your Income
- Save Money on Major Purchases
I’ve listened to quite a few Robert Kiyosaki podcasts and I have to say I’m not the biggest fan of the financial advice he gives. He takes a very conservative approach to investing, like recommending investing in gold and real estate. However, Rich Dad, Poor Dad is full of great money advice and really focuses on “rich” and “poor” ways of thinking about money.
Kiyosaki discusses how his father had a very “poor” mindset about money. His father treated money like a limited resource that he had to hold onto and protect as much as possible. His friend’s father (referred to as “rich dad”) had a completely opposite way of thinking about money. He approached money as an infinite resource that could be acquired easily, and as a tool for building and creating new ways to make money.
I realized that I was holding onto some assumptions that I had about money that weren’t optimal for maximizing the money I already had as well as my future earnings.
The 4-Hour Workweek is less about investing money and more about rethinking the way that we earn money. Ferriss explains how charging people for your time is incredibly limiting. There are only so many workable hours in the day, so you will eventually reach a limit of how much money you earn if you are charging by the hour.
The 4-Hour Workweek talks about how outsourcing certain tasks, starting online businesses, and working towards passive income can drastically increase your wealth and your happiness.
I read this book about a year ago and found it really useful for framing the way that MASSIVE wealth is created. This book details the journeys of some of the most notorious multi-millionaires in history. It shares stories of how Conrad Hilton, Howard Hughes, and others took rather straightforward ideas and pursued them with enough commitment and passion to turn them into multi-million dollar businesses.
This book is less useful for learning personal finance principles, but I still enjoyed these business magnates’ stories.