Finance & Investment

Hello people. I am eager to introduce to you the world of finance and investment. This is because I would like you to set up a budget and invest your money properly so that you can run away from your financial worries in the future. It is important to know how things work if we want their advantages to be used simultaneously and in the right way. If we do not know how things work, we would not know how to set up a budget and invest our money in the right way. This would be a waste.

 

These three areas that I am telling you about are very important if we want to develop our capability of managing money as individuals. Of course, you could ask me why I am talking about this issue when I have just finished telling you about the five habits of highly effective people. Well, the answer is simple. These two things are so closely related to one another that it is impossible to discuss the former without mentioning the latter to develop one's financial capability and self-discipline. That is why I am telling you about it. So, let us start creating financial discipline and capability by fixing a schedule for budgeting and spending our money. You need to know that if you have to say "no" when the time comes, you will have to admit that you cannot smartly manage your resources to make planned benefits out of them. That would be a bad experience. The best way possible.

Finance is an important thing that people can get from their very early beginning in their lives. This is because finance can give you a lot of advantages for your future. These advantages include paying back your debts easily and having enough money in your pocket for you and your family's needs. Work for us, right? To learn more about finances, this article will give you a short background on it and what your responsibilities are when it comes time to invest.

Besides podcasts, blogs, vlogs, etc., reading books is still something many individual investors don’t want to miss.

Although I have read many good books covering software engineering and other things in tech, I’m currently studying finances and investments. I want to learn their “best practices,” just like in programming.

Today there are hundreds (if not thousands) of books on wealth growth, and obviously, it’s impossible to skim all of them because the average person reads between 25 and 30 books per year.

Hence, finding the ones worth reading in finance and investment to accomplish your financial goals like below is not that easy; at least it wasn’t for me.

However, there are evergreens available, books that are still relevant today, and often recommended by investors, financial experts, and people who are interested in investment in general.

Here are my top-10 books.

I would recommend reading these for any aspiring investor who is willing to become financially literate, set up their financial goals, reach financial independence and early retirement:

1. The Intelligent Investor

It’s the definitive book on value investing written by none other than Benjamin Graham, Warren Buffett’s tutor.

The author preaches diversification, prudence, and the importance of not getting caught up in bull markets — speculative investments during bull markets can lead to a huge loss of principal investment.

Graham also pointed out that investors should look at the underlying value of a business before investing in any company business:

There are no good or bad stocks; there are undervalued and overvalued ones.

Investing formula from the book: buy more shares when the market is low than when it is high, and it’ll likely end up with satisfactory overall pricing for your investor’s holdings.

There are three principles of intelligent investing:

1. An intelligent investor always analyzes the long-term evolution and management policies of a company before investing.

 

2. An intelligent investor always protects themselves from losses by diversifying investments.

3. An intelligent investor never looks for crazy returns but focuses on safe and steady profit.

In Buffett’s words:

Rule N01: Never lose money.

Rule N02: Never forget rule N01

 

 

2. Stocks And Uncommon Profits

Fantastic if you are interested in what makes any business tick!

This is the only investment book I ever read and even studied that gave me a feeling of being “well-equipped” with the potential to become a successful investor.

Fisher’s guidelines are quite helpful, but they are mostly qualitative-based compared to those of Graham’s and Buffett’s, which are more quantitative, like research management and qualitative details of a company; R&D investments; what the company’s doing to improve margins, among other criteria.

In my own experience, I have tried to apply some of the few tricks and tips from the author, which helped me answer the questions while analyzing stocks because I know that the growth stock (when bought young) offers by far the highest possibility of gain.

Comprehensible and timeless investment classical book that should be read by anyone serious about achieving success in the stock market.

3. Unshakeable

If you understand mathematics, you will definitely understand money.

I am not a fan of Tony Robbins, but in his book, Tony provides the best explanation of why most people don’t make it in the markets, and the minority does.

The main focus is on

core principles of investing

asset allocation

investor psychology

admin fees

tax laws

For instance, even though his book most US-centric on US tax law examples, while being a tax resident in Germany, I knew not much about tax laws in Germany. Still, the theory behind these principles is the same in the majority of developed and developing countries. That’s why you always make sure you invest in a most tax-efficient way, and you don’t get a hefty chunk of money removed from your profit when you come to withdraw.

The core lesson is to shape your mindset into unshakeable financially, which requires determination, integrity, smart working, knowledge, and forward-thinking!

4. Rich Dad Poor Dad

If you stop working today, how long can you survive?

№1 advice on how to make your assets work for you, so you can quit your job, enjoy life, and make money while having a dream life.

The truth that the rich dad focuses on generating income and assets, and the poor dad and middle-class dad view their liabilities as an asset.

This book is a must for everyone who is looking for financial independence.

It will help you to grow your mindset towards money and shows you how people, in reality, are held back in terms of finance due to their upbringing.

Poor people work for money, while rich people make money work for them.

5. The Richest Man in Babylon

There’s nothing truly revolutionary in the book published in 1926, which is why I like it. It is a bit of fiction, but the stories bring out important lessons.

I led this book by “Rich Dad Poor Dad,” and this book further explains what Robert means by “pay myself first.”

The underlying message is to spend less than you make and save (invest) the rest.

Perhaps the most significant book takeaway is that wealth goes as quickly as it comes if in the hands of a negligent person, in other words, in the hands of a materialistic consumer.

If you haven’t read this book yet, you must do it. It’s a powerful read on wealth creation.

6. The 4-Hour Workweek: Escape 9–5, Live Anywhere and Join the New Rich

A bestseller should be read by those who want more from their working time and money-making assets and expand the time available for passions.

“Someday” is a disease that will take your dreams to the grave with you.” — Tim Ferriss.

In short, try to eliminate as much as you can of your life, to travel lighter and faster.

Another question you have is how you can work 4 hours per week?

The receipt in a nutshell:

Don’t work too much for someone

Earn the same money for less amount work

Tim Ferriss earns around $90000 per month with 4 hours of work per week.

How does he do it exactly? More importantly, how can you do it? The answer you can find is by reading his book.

7. The Dhandho Investor: The Low-Risk Value Method to High Returns

Instead of unnecessary complexity, it’s well written and easy to read.

The author is an expert at finding undervalued company stocks.

He explains a few of his investing ideas and thought processes behind stocks.

The book is based on the philosophy of “Heads I win, tails I don’t lose much.” It mainly focuses on the stock market and gives you some basics, practical principles, and useful examples to apply in stock investments in general.

Just read, learn, and then earn by applying!

8. The Elements of Investing

This book is clear and to the point about how to be a long-term investor to pursue average market gains with minimal losses.

Though it is a heavy emphasis on sticking to your financial plan that fits your risk profile, asset class allocation, and investing in index funds and ETFs, please keep it simple and passive as much as possible.

It’s an excellent overview of investing, especially when saving for retirement. The book is down-to-earth and straight to the point. It contains a lot of valuable advice for any new person who wants to start investing and understanding financial jargon.

Invest smart, invest early, invest often.

9. The Little Book of Common Sense Investing

Beginner investors will not go wrong, implementing the advice outlined by the author!

Because it is very applicable to the many individual investors today:

Investing in index funds is a great low-cost and low-maintenance way to profit and get the market’s return.

To provide more context to the reader, Bogle illustrates the returns of various mutual funds and index funds through diagrams and charts. Also, he compares, based on how invested, your original investment, and how it would look after a particular time.

Moreover, I like the book format. It’s divided into short chapters and useful data, and neat quotation sections at the end of each chapter.

“The greatest enemy of a good plan is the dream of a perfect plan. Stick to the good plan.” — John Bogle, founder of The Vanguard Group.

10. Think and Grow Rich

No doubt, this book’s principles can be used in any area of life, not just about monetary wealth, because richness means not only necessarily money. It measures not only in terms of financial gain and success but also in business ownership, development, intelligence, and working in general.

Richness has everything to do with investing in yourself!

Everything starts with how we think. We can achieve anything we want:

“Whatever the mind of man can conceive and believe, it can achieve.” — Napoleon Hill

The book contains success stories for 13 lessons from people who have made great strides in achieving unbelievable financial goals.

Every story begins with the idea when the person has committed themselves, so the opportunities come, and they begin to prosper.

Perhaps, it’s the only book a person needs to read to grow rich because most of the other such books are either inspired, referenced, or paraphrased from this book.

Conclusion

To sum this piece up: these are some of the must-have books on finance, investment, and growth mindset to read, in my opinion.

I will try to keep this list in sync with new reading releases.

Finance and Investment, like Software Engineering, have always been challenging to understand and even more challenging to succeed fully.

Nonetheless, real experts and enlightening books can be instrumental in wealth accumulating success because such books are your best mentor in whatever you’re eager to learn.

Focus on those books that work for you first.