If you want to educate yourself on investing money, you will quickly realize there is a lot of information out there. While some of it is good, most it not helpful or even potentially dangerous if you don’t know what to do with it. With that in mind, this article will walk you through some of the best books on investing money for beginners.
In this post I have recommended some best books talking about investing money for beginners.
Best Overall: The Little Book of Common Sense Investing
Most experts, including the Investopedia Financial Review Board, agree that John C. Bogle’s best-selling financial guide is akin to an investing bible. No matter your age, this book is a must-read before you start investing. First published in 2007, this 2017 edition includes two new chapters on asset allocation and retirement investing options.
“The Little Book of Common Sense Investing” provides a framework for building a low-risk portfolio and teaches you how to make the smartest investment decisions. Bogle also explains the importance of index funds and advises readers to ignore investing fads and focus instead on constructing a broad and diversified portfolio.
Best for Financial Basics: Broke Millennial
“Broke Millennial,” as recommended by members of the Investopedia Financial Review Board as one of the top picks for young investors, addresses what many other investing guides fail to acknowledge: understanding personal finance and addressing your spending habits are crucial if you want to become an effective investor.
Erin Lowry explains how to take control of your finances, even if you don’t make much money, and how to begin investing. Young investors will learn tips for how to stretch their paychecks and how to get started on building a retirement fund at an early age. Unlike many traditional financial guides, this book is written by a millennial for millennials in simple terms that novice investors will grasp quickly.
Best for Investing Basics: The Only Investment Guide You’ll Ever Need
Learn how to get started building an investment portfolio with $0 using this guide. Finance writer and co-host of the PBS series “Beyond Wall Street: The Art of Investing,” Andrew Tobias walks young investors through the importance of building a financial foundation for investing and focuses particularly on establishing a healthy savings account.
Readers will find sound investing advice that can be applied to all aspects of their financial lives in this guide. “The Only Investment Guide You’ll Ever Need” was originally published in the 1970s and was completely updated in 2016 with more commentary on modern-day investing, including the author’s thoughts on the 2008 financial crisis.
Best for the Psychology Behind Investing: Thinking, Fast and Slow
Why do we make decisions based on a gut feeling rather than on facts and statistics? Daniel Kahneman, psychologist, economist, and winner of the 2002 Nobel Memorial Prize in Economic Sciences1, dives into the methodology we often use to make major decisions, from choosing who to marry to investing our money. This New York Times bestseller2 hones in on how many of us make choices based on instinct and intuition and how this can impact your life, including your financial future.
“Thinking, Fast and Slow” will also reveal how to make smart investing decisions by removing emotion from the equation. Young investors will learn more about the psychology behind how leading investors choose stocks that are likely to outperform others. All in all, Kahneman demonstrates how to make “better” decisions based entirely on logic, even if these decisions feel uncomfortable.
Best for Passive Real Estate Investing: Investing in REITs
Passive real estate investing is often overlooked by young investors who might equate investing in real estate with becoming a landlord or property manager. The fourth edition of “Investing in REITs” breaks down how young and new investors can begin diversifying their portfolios and earn some of the best returns on the market through REITs.
Written by the late Ralph L. Block, an expert advisor on REITs for 40 years, this book offers a comprehensive exploration on REITs, the history of this investment type, and how to begin incorporating them in your portfolio. Block received the 2004 Industry Achievement Award from the National Association of Real Estate Investment Trusts 3(NAREIT).
Winning the Loser’s Game
Now in its seventh edition, Winning the Loser’s Game is a personal finance must-read. The premise of the book is that individual investors can achieve far greater success working with financial markets instead of against them. That sentiment is especially pertinent in today’s volatile markets.
Drawing on his experience as managing partner of Greenwich Associates, Charles D. Ellis says the futility of “short-termism,” striving to attain relatively immediate performance by stock picking and market timing, compared to the greater benefits of long-term investment policy, is the key driver of investment success.
Ellis’ concise yet comprehensive approach covers everything you need to know for long-term market success, from confronting market changes to understanding exchange traded funds (ETFs).
The Intelligent Investor
Originally written in 1949 and hailed by Warren Buffett as the book that “changed his life,” The Intelligent Investor is considered a stock market bible.
The book is based on value investing, an investment approach author Benjamin Graham began teaching at Columbia Business School in 1928, but, we promise, still works. This approach of shielding investors from substantial error and teaching them to develop long-term strategies has since been honed and refined by generation after generation.
Graham takes the reader on a value investing journey, beginning with the history of the stock market—it’s more interesting than it sounds, trust us—and examines fundamental stock analysis and both positive and negative portfolio management before comparing real company stocks against each other
A recent revision includes updated commentary by financial journalist Jason Zweig, whose perspective crucially incorporates the realities of today’s market.
The book may be almost 100 years old, but its wisdom is timeless.
Balanced Asset Allocation
Balanced Asset Allocation introduces the core concepts behind constructing a balanced portfolio, which is vastly different from the traditional 60% stock, 40% bond allocation.
The emphasis is on understanding what fundamentally drives asset class returns and then building balanced portfolios based on these relationships.
Investment consultant Alex Shahidi walks you through the logic behind the balanced portfolio framework and provides step-by-step instructions on how to build the right portfolio. Shahidi also explains how to avoid the most common investment tactics that expose even well-balanced portfolios to unanticipated risks.
The end result is a portfolio indifferent to the economic climate, in contrast to conventional portfolios, which are often highly dependent on a strong economic outcome.
The Little Book that Beats the Market by Joel Greenblatt
As Buffett says, investing is simple but not easy. This book focuses on the simplicity of investing. Greenblatt, who has average annualized returns of about 40% for over 20 years, explains investing using 6th grade math and plain language. Putting it into practice is another story.
Poor Charlie’s Almanack by Charlie Munger
Charlie Munger is perhaps the smartest man I don’t know. This book is a curated collection of his speeches and talks that can’t help but leave you smarter. Munger’s wit and wisdom come across on every page. This book will improve your thinking and decisions. It will also shine light upon psychological forces that make you a one-legged man in an ass-kicking contest. Read and re-read.
Lords of Finance
Beginning with the First World War, Lords of Finance examines events as told through the personal histories of the four heads of the Central Banks of the United States, Great Britain, France, and Germany.
After the First World War, these central bankers attempted to reshape the world of international finance, supported by the gold standard. For a time, they succeeded. But then: the Great Depression.
Published in 2009, Lords of Finance explores the mistakes and triumphs of the time and was a go-to manual during the most recent global financial crisis.
It offers a potent reminder of the enormous impact that the decisions of central bankers can have and of the terrible human consequences that can result when they are wrong.
A Template for Understanding Big Debt Crises
Ray Dalio, the founder of hedge fund Bridgewater Associates, shares his template for how debt crises work and the principles for dealing with them effectively.
Dalio dissects numerous debt meltdowns from the last 100 years by converting what is a sprawling issue into a clear process of cause and effect, highlighting patterns that exist in even the most chaotic developments.
Conclusion
Do you want to invest money? Are you a newbie? Don’t worry. There is help out there. Fortunately for you, we have gathered a list of books on investment for beginners so that you can learn about the basics and the fundamentals of investing. When working, always remember that one must know the right information first before making a decision. With that in mind, let’s begin studying investing money at home!