It’s freezing here today in Palo Alto as I write this; a great day to curl up on the sofa with a good book in front of the fire. If you’ve read my “Who Is Kung Fu Girl?” bio you’ll know I’m an avid reader (nerd alert!), and last year I read approximately 50 business / finance books (I average about one per week).
There are a LOT of personal finance books out there (according to Amazon, over 36,000 of them!) and to be honest, a lot of them really aren’t all that great.
So to save you some time and frustration wading through all of the mediocre ones (and in case you are not as much of a bookworm as I am), I want to share with you my all-time favorites, the ones that have had the most dramatic impact on my own personal finances.
So without further ado, as I promised you last Friday, here are my “Top Five” personal finance books:
5. Your Money or Your Life, by Joe Dominguez and Vicki Robin. I note that Vicki now has a newer edition out “Updated for the 21st Century!” that I haven’t read, but the original book is fantastic if you can find it. This book got me started on the path to financial success by encouraging me to come up with my own definition of “wealth” and “financial success” and to figure out what I really wanted out of life and how to go get it.
Joe and Vicki define money as “life energy” and help you convert what you think is your salary into your actual “life-energy units”. They help you focus your spending on only the things that truly give you pleasure or add meaning to your life, and help you determine your own personal “crossover point”– the point at which you don’t have to work at a traditional job anymore but can live off of your investments!
The only trouble with this book now is that the authors were writing it in the midst of a historical 30-year bull market for US Treasury Bonds (during the 80’s those paid 10% and higher!) which would be financial suicide today. But maybe the updated version covers that now….(this edition is almost 20 years old). Still, I consider this a must-read.
4. Rich Dad Poor Dad: What the Rich Teach Their Kids About Money-That the Poor and the Middle Class Do Not!, by Robert Kiyosaki. This book changed my life. (I know I said that about the Jekyll Island book, too, but it’s a close call between the two!) There is a reason why this is the Number 1 best-selling personal finance book of ALL TIME. Kiyosaki does an outstanding job explaining the difference between assets and liabilities and the importance of cash flow. This is the book that finally got me to stop buying crap and start buying real assets, and sure enough, my wealth has skyrocketed ever since, just like he says. This is also the book where he was vilified for saying “YOUR HOUSE IS NOT AN ASSET” long before the housing crash.
3. Rich Dad’s CASHFLOW Quadrant, by Robert Kiyosaki. I recommend anything by Kiyosaki, but this one and Rich Dad, Poor Dad are terrific. In CASHFLOW Quadrant, he breaks down the different types of income (earned, portfolio, passive) and divides up the world into four quadrants: “employees”, “self-employed”, “business owners”, “investors” and shows why the tax laws (and in fact, almost all laws!) favor business owners and investors. This book explains why the 1% portion of the pie keeps getting bigger and bigger every year.
2. The Creature from Jekyll Island, by G. Edward Griffin. I’ve already talked about this book in a previous post so I’ll leave it at that other than to say that almost all of the multi-millionaires that I know have read and recommend this book (Kiyosaki was the first to recommend it.)
1. Think and Grow Rich, by Napoleon Hill. First published way back in 1937, this is a classic and focuses almost exclusively on how to “Master Your Mind”, as we say here at Kung Fu Finance. Highly recommended.
There are many, many others, but these are definitely my all-time-top-five favorites!
What about you? What are your favorite books and which have helped you the most? I hope you’ll share with all of us in the comments!
Thanks so much for reading– I hope you enjoyed this list.
To your financial success,
— Kung Fu Girl