You went from living with your parents to living in a dorm room and being on your own. Pretty soon (if you aren’t already) you will be completely responsible for paying bills and making ends meet. That’s why it’s important for you to know how to manage money properly. Unfortunately, this stuff isn’t taught in a college classroom.
Here are the top five personal finance, money and investing books for college students and recent college graduates. These books will provide you with practical advice about living in and coping with the “real world”.
1. Rich Dad, Poor Dad by Robert Kiyosaki
There’s a reason why this book is a classic best-seller, and it’s because it’s a mighty fine read. Kiyosaki explains how his poor dad might have been highly educated and had a good career, but he slaved away for money. His other dad barely had an education, but he made money work for him.
Kyosaki focuses on investments that will give you cash flow, i.e. making your money work for you. He explains how America’s educational system is designed to keep people working hard for their entire life and how it’s difficult to create wealth in this situation. Your college degree might be important, but it’s critical that you understand the concepts in this book.
2. Millionaire Teacher by Andrew Hallam
This book is one of my favorites, and one that I recommend to everyone who is starting with no knowledge (or nearly no knowledge). It teaches you the basics – stuff that anyone can easily apply and get results. Plus, the author was a real teacher (a notoriously underpaid career) who became a millionaire from his investments. That alone should get you to read the book!
If you decide to pick this one up, you’ll see that it’s easy to read and written for a beginner. It doesn’t have a lot of fluff like many other books out there, and it just focuses on the things that are important. Definitely put this one on your to-read list.
3. Total Money Makeover by Dave Ramsey
If you’re like the average college student or college graduate, you’re probably leaving your alma mater with some serious student loan debt. You’re in luck – Dave Ramsey is the king of getting rid of debt. While he’s written several books, this is THE one you need to read. It’s sold over 5 million copies and is a collection of seven simple steps that will help you get and stay out of debt.
However, this isn’t just a debt book. Ramsey also gives valuable advice about increasing your income, changing your attitude about money and saving for the future. The steps are easy to follow and once you’ve read the book, you’ll have no excuse for carrying around that ball-and-chain known as student loan debt.
I DO want to give you a word of caution: Dave Ramsey advocates paying off the smallest debt first, no matter the interest rate. He claims that this will have a psychological/motivational effect on you and cause you to continue with your mission. I strongly advise you to weigh if this will be beneficial to you, because mathematically it doesn’t make much sense. Mathematically, you should pay off your highest interest-bearing debt first.
4. The Automatic Millionaire by David Bach
Hopefully you plan on starting your career after college. Once you get that nice fat salary, you can begin contributing to a 401(k) or some other investment plan. David Bach will help you streamline the entire process. I love this book because it makes investing as easy as possible. Completely painless!
The whole premise of this book is “pay yourself first”, which is a concept you’re going to have to learn if you want to have a shot at retiring rich. The book is really specific and to the point, which is good if you’re just looking for what to do and how to do it. He also explains why it is so important to use automated payroll deductions. You won’t even miss the money!
By the way, this isn’t even my favorite David Bach book. My favorite is, “Smart Couples Finish Rich”, so if you find that special someone, make sure you read it too.
5. The Money Book For The Young, Fabulous and Broke by Suze Orman
Chances are you’re all three! Young, fabulous AND broke! In this book, Suze Orman covers a wide variety of topics, from student loans, insurance, and credit card debt, all specifically geared towards young people. This is great, because most personal finance and investing books tend to be written for someone in their 40s and 50s, so college students and college graduates don’t even receive the book in the first place.
This book is a whopping 400 pages and it will help you navigate a complicated financial world and give you a grasp on the topics you need to know to take charge of your money. It’s geared towards those in their 20s and 30s, so you get the stuff that you need!