Surveys worldwide revealed that people make poor financial decisions in both emerging and developed economies. Did you know that four in ten Americans don’t plan for retirement? Educated people with high-income brackets can still be financially illiterate.
So, how do you get yourself to be financially educated? Some people are lucky enough to be taught in school or by their parents, but those who were not will need to educate themselves. And the most accessible way to do that is through reading!
To give you a helping hand, we have collated eight of the best financial literacy books you should read (all of which can be found on the Headway App). These books have something for everyone and are a great starting point for building a successful financial future. Looking to make the most out of your time? Download the Headway app to learn the core concepts from these all-time best financial literacy books today!
Key points
What is financial literacy? The academic definition is that financial literacy is the ability to understand and use several financial skills, such as personal financial management, budgeting, and investing. It is the foundation of your relationship with money and is a lifelong journey of self-discovery and learning.
The concept of financial literacy varies from person to person. For some, it means learning how to use a credit card responsibly or saving money. For other people, it means learning to invest in the stock market or manage a retirement account.
Regardless of what resonates with you, we can all agree that financial education is critical for avoiding high debt levels and securing a safety net for the future.
Some must-read books on financial literacy include Why Didn’t They Teach Me This in School? by Cary Siegel, Business Adventures by John Brooks, and Clever Girl Finance by Bola Sokunbi.
8 Best Financial Literacy Books
1. Think and Grow Rich: The Original Version, Restored and Revised by Napoleon Hill and Ross Cornwell
After interviewing American steel industrialist Andrew Carnegie, Napoleon Hill was inspired to write Think and Grow Rich. Hill sought to investigate the psychology of success. Twenty years later, the result of that quest was this financial literacy classic that kickstarted a boom in the genre of finance books and self-help.
Hill makes several statements about success and financial literacy that, if followed, should help you grow rich. These include:
every major achievement begins with an intense belief in one’s ability to accomplish it;
you are who you think you are, so think positive thoughts and eliminate fear and doubt;
knowledge is only as good as the plans you have to use it,
persistence is insurance against failure;
make decisions quickly, and not easily swayed by other people’s negative opinions.
Think and Grow Rich is a bestselling financial literacy book. Although it was first published in 1937, many find its philosophy of positive thinking and its specific steps for achieving wealth still relevant today.
2. The Millionaire Next Door: The Surprising Secrets of America’s Wealthy by Thomas J. Stanley and Dr. William D. Danko
The Millionaire Next Door states that most of the truly wealthy in the United States don’t live in Beverly Hills or on Park Avenue. They live next door. Despite common conception, America’s wealthy don’t get that way through an inheritance or advanced schooling. America’s wealthy get that way through bargain-shopping for used cars, humbly raising children, and rejecting a lifestyle of flashy exhibitionism and competitive spending.
Stanley and Danko debunk the myth that the glamorous people we think of as ‘rich’ are a tiny minority of America’s truly wealthy citizens. The millionaire next door lives quite differently from most of the population.
In The Millionaire Next Door, Stanley and Danko look at millionaires and find seven habits that they have in common — including living below their means and rejecting traditional consumerism. This financial literacy book continues to top must-read lists and is the perfect choice if you’re looking to understand the habits of the rich and successful.
3. The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich by Tim Ferriss
This financial literacy book is the perfect fit for those looking to forget the old concept of retirement. The 4-Hour Workweek is a blueprint for earning a monthly five-figure income, escaping the rat race, traveling, and working less. In a step-by-step guide, Ferriss explains how to take charge of your life with excerpts on:
how he went from $40,000 per year to $40,000 per month;
how he outsourced his life to overseas virtual assistants;
how to eliminate 50% of your work time using the principles of a forgotten Italian economist;
how to trade in your lifelong nine-to-five job for short work bursts and frequent mini-retirements.
The 4-Hour Workweek includes over fifty practical case studies and tips from readers who have overcome common investment pitfalls, doubled their income, and reinvented themselves using this book as a starting point. This is the best financial literacy book if you are looking to change your day-to-day life.
4. Business Adventures: Twelve Classic Tales from the World of Wall Street by John Brooks
Join John Brooks, a celebrated New Yorker contributor, on a captivating journey through America’s corporate and financial landscape. From Wall Street to Main Street, these twelve classic tales come to life with vivid detail and offer timeless insights into the business world.
You will learn about some of the most interesting and important historical financial events. From the great crash of 1962 to the fall of a famous brokerage firm to the attempt to save the British pound, you’ll feel like you’re a part of the story. Along the way, you’ll also realize that history has a way of repeating itself.
Business Adventures is the best financial literacy book for anyone interested in the history of Wall Street.
5. The Intelligent Investor: The Definitive Book on Value Investing by Benjamin Graham
The Intelligent Investor is one of the essential books on financial literacy and investor education. Graham thrived at making money in the stock market by evaluating companies with impressive precision. It is of note that risk-taking and day trading was never a part of Graham’s investment strategy.
One of Graham’s main contributions was to point out the irrationality and groupthink that was often rampant in the stock market. According to Graham, investors should aim to profit from the uncertainty of the stock market rather than participate in it.
Graham’s value investing philosophy protects investors from errors and teaches them to develop long-term strategies. This philosophy has made The Intelligent Investor the stock market handbook since its original publication in 1949. In the years since, market developments have proven the wisdom of Graham’s strategies. The principles discussed in this financial literacy book could help you reach your financial goals.
6. I Will Teach You To Be Rich: No Guilt. No Excuses. No BS. Just a 6-Week Program that Works by Ramit Sethi
Being rich has nothing to do with spending money. Financial expert Ramit Sethi says you can spend your money guilt-free if it is invested and allocated properly.
This financial literacy book deals with common pitfalls, from paying off student loans to saving each month and even talking your way out of late fees. This latest 10th-anniversary edition includes updated technology, money, and psychology views. Sethi has also included some success stories of readers who have gotten rich from reading I Will Teach You to Be Rich.
7. Broke Millennial: Stop Scraping By and Get Your Financial Life Together by Erin Lowry
Can you decipher #GYFLT? If you can, this is the financial literacy book for you (#GYFLT is a social media acronym for ‘get your financial life together’). In Broke Millennials, Erin Lowry explains how the millennial generation can get in control of their finances.
Broke Millennials is a simple how-to guide on going from flat-broke to financially literate. Unlike most personal finance books, it doesn’t just cover stale content like credit card debt, investing, and budgeting. Instead, it covers topics like paying off your student loans, understanding your relationship with money and sharing details of your finances with a partner. Broke Millennials covers millennials’ biggest money challenges today.
Packed with refreshingly simple advice and funny true stories, Broke Millennials is the essential financial literacy book for any millennial that needs a bit of extra guidance.
8. The Financial Diet by Chelsea Fagan and Lauren Ver Hage
The Financial Diet has been described as a personal finance book for the kind of person that doesn’t care about personal finance. Whether you’re looking for how to live on an entry-level salary, need an overspending detox, or are overwhelmed by student debt, The Financial Diet gives you the tools to build a healthy financial world. This financial literacy book covers budgeting, investing, and managing credit.
This book is a guide to unlocking the power of true financial freedom and fulfillment. Chelsea Fagan and Lauren Ver Hage delve into the idea that managing your money is about much more than just saving and investing. It’s about understanding the connection between every aspect of your life and your finances — such as the clothes you wear, the relationships you build, and even the food you eat.
This bestselling financial literacy book will teach you:
how to discuss money with your friends;
how to properly budget;
how to take care of your house;
how to start investing.
The Financial Diet is a great financial literacy book for anyone wanting to learn about finance in an accessible and entertaining way.
Read more books about financial literacy with Headway
Financial literacy can be the difference between living paycheck to paycheck and living your best life. While ten books cannot give you everything you need to know about finance, it’s a great starting point. If you want to supplement your knowledge or gain the core concepts of these books faster, try the Headway app.
Headway provides a solution for busy individuals to continue their financial literacy journey by listening to book summaries while on the go. You can prioritize your finances while maintaining a busy routine and work schedule.
Are you looking to improve your financial literacy this year and live the life you’ve always dreamed of? Download the Headway app to access a large library complete with the best books on financial literacy.
FAQs
What is the best book to read on finance?
There are so many layers of financial literacy to unpack — such as personal finances, budgeting, investing, and loans. To choose just one book and call it the best is nearly impossible. However, Benjamin Graham’s The Intelligent Investor is a book that often comes up when the topic arises. This read is a great starting point for financial novices looking to learn more about investing.
How do I teach myself financial literacy?
One of the best ways to teach yourself financial literacy is through reading! When it comes to the best financial literacy books, Headway’s list of the eight best is a great place to start. Check out the Headway app if you prefer listening to a financial podcast while you do housework, run errands, or walk the dog. This app offers 15-minute audio book summaries so you can get the core concepts out of the world’s best financial gurus.
Where do I start with financial literacy?
The financial world is overwhelming, and many people keep their heads in the sand. Even if you’re not interested in investing, it’s still worth knowing the basics of budgeting and saving. Broke Millennial is a good place to start, as it offers a simple how-to guide that covers topics like paying off your student loans, understanding your relationship with money, and sharing details of your finances with a partner.
