So here is the thing, knowledge is power. To get ahead in the game I found that the cheap, easy way, to gain knowledge is reading regularly. Make it a habit of reading often, it is cheap entertainment and it can teach you a bunch of things that you might not have thought of otherwise. If it will get you off Netflix a bit, it cannot be that bad! 🙂
For all of you out there aiming for financial independence, you need to grow and explore a new mindset that will prioritize your wealth and wellbeing. I wanted to share with you some books that I really enjoyed so far and changed me along the way.
The first book on my list is not for everyone but definitively an eye-opener. Early Retirement Extreme: A Philosophical and Practical Guide to Financial Independence by Jacob Lund Fisker is about retiring on a very small budget, very early! Jacob runs a blog at EarlyRetirementExtreme.com that is pretty instructive. I enjoy his take on early retirement since it makes it available to the middle-class and anyone starting out his career. I can easily relate to Jacob’s book since he puts up a very achievable goal. He retired on a tiny budget and follows traditional values to maximize his life. It is an excellent read for anyone, whether you make $20 an hour or $200, the principals shared are always relevant. If you are earning under $50,000 a year, it can be hard to save up a million dollars and you might get demotivated before the first decade but fortunately, we do not all need $1M to retire. 🙂
On the investment side, I really liked The Bogleheads’ Guide to Investing by The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns by John C. Bogle. Those two complement themselves as the base to index fund investing. John C. Bogle is the founder and CEO of Vanguard and literally changed Wall Street by giving the chance to everyday retail investors to participate in the markets at a very low cost. I use this approach to investing in my own portfolio and believe that low-cost index fund strategies are one of the best ways to accumulate wealth. This first book is by fanboys and covers great strategies to invest properly with Vanguard.
Owning a diversified portfolio of stocks and holding it for the long term is a winner’s game. Trying to beat the stock market is theoretically a zero-sum game (for every winner, there must be a loser), but after the substantial costs of investing are deducted, it becomes a loser’s game. Common sense tells us—and history confirms—that the simplest and most efficient investment strategy is to buy and hold all of the nation’s publicly held businesses at very low cost. – John C. Bogle.
Many books can change the way you see and perceive wealth. A real eye-opener for me was The Millionaire Next Door: The Surprising Secrets of America’s Wealthy by Dr. Thomas J. Stanley and Dr. William D. Danko. This is a 20 year-long research that the authors performed interviewing millionaires across the country. The findings show the common traits that most millionaires share and their path to amass such wealth. I found it very interesting to compare with my own behaviors and spending/saving habits. This is a quick read that can help you improve your financial habits or general views on life. It is always so fascinating to see how normal wage earners like plumbers and teachers can reach financial freedom and retire early.
Nearly anybody with a steady job can amass a tidy fortune. – Thomas J. Stanley and William D. Danko
One good inspiration for me was also Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School by Andrew Hallam. This book shows how simple index fund investing and a proper investment methodology can help any middle-wage individual become a millionaire. The author was a schoolteacher who has accumulated great wealth simply by sticking to the plan. Like Jacob’s book, this helps any middle-class investors to relate. A very inspiring book that shows a clear step-by-step to wealth building. It shows the very principles I teach here; younger investors should hope for market crashes, stop looking at stock market news, ignore the “professionals”, and finally, invest in low-cost index fund investing.
Finally, for the folks like me from Canada, a good start is The Wealthy Barber by David Chilton. This is a comprehensive, step-by-step book that offers the Canadian’s perspective of the basics of personal finance. Explained in Lehman’s terms, this is a great start for anyone just starting off. It goes through the basics of personal finance but is not directly aimed towards financial independence or early retirement like the other books discussed.
Hope you enjoy and learn a lot from these. If you don’t feel like reading whole books, you can always subscribe to our mailing list to receive our articles every week!