12 Best Financial Literacy Books for Beginners: Bookmark This Page

If you’re browsing titles for your next read, you might want to put The Psychology of Money or other highly interesting, highly rated, and highly helpful financial literacy books on your list. 

Learning to be in control of your finances is empowering, though it can definitely be intimidating—shockingly, only 33% of adults globally are financially literate. Tha leaves 3.5 billion adults without the proper understanding of basic financial principles. 

Globally, the need for real financial education is desperate, with 88% of young adults from the United States saying that when they left high school, they didn’t feel “fully prepared” to deal with real-world money matters, and most say they would be “further ahead with their money today if they had a personal finance class in high school.”

In a post-pandemic study on adult financial literacy across 26 countries, 42% of people surveyed said they worry about meeting daily expenses and only 15% said they had enough savings to support themselves for three to six months. For most people, the road to financial independence is paved with obstacles, and financial freedom (something we all dream about!) seems impossible to achieve. 

In this article, we’ll first go over the basics of financial literacy – and then point you in the right direction of some great finance books for beginners. If you’re daunted by personal finance and money management or simply want to improve your financial health (we could all do with a few tips!), reading the right financial literacy books can be a fantastic place to start. 

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What is financial literacy? 

Investopedia defines financial literacy as “the ability to understand and effectively use various financial skills, including personal financial management, budgeting, and investing.” 

The more financially literate you become, the more successful you will be at being able to support your life’s goals, like furthering your education to become a lawyer or putting up your own business as a future entrepreneur. 

You can begin to improve your financial literacy at any time—you can take online finance courses, consult with financial advisors, listen to podcasts on financial advice, use finance apps and tools, and glean some knowledge from financial literacy books, so you can live your best and healthiest financial life.

What are the basics of financial literacy? 

There are five key components of financial literacy. Let’s break them down.

1. Budgeting is the act of putting together a budget, which is an estimate of income and expenses over a period of time. It allows you to conduct good financial planning, so that you can live within your means and meet your financial goals.

2. Building and improving credit refers to your ability to manage your credit so that you can make certain financial moves such as applying for a credit card, buying or leasing a house, and purchasing a car. Ways to manage your credit score include staying on top of credit card bills and maintaining a debt-to-income ratio of no more than 28% to 36% of pre-tax income.

3. Saving refers to setting money aside for the future and is great for meeting short-term financial goals and dealing with emergencies. You can save money using bank accounts, savings accounts, retirement savings funds, emergency funds, and investments.

4. Managing debt does not just refer to your credit card; it can include any loan or other types of credit you might take out. It’s critical to stay on top of your debt—make payments on time and in full (as much as possible), never pay less than the minimum amount, and always make a plan to repay the debt in full.  

5. Investing is growing your money over time by putting it into financial instruments such as stocks, mutual funds, and bonds. It’s riskier than saving but with higher returns in the long run, perfect for meeting long-term financial goals, building wealth, and achieving retirement plans.

What are the best financial literacy books? 

While there are so many financial literacy books out there, we’ve narrowed our list down to a sharp selection of the best finance books, just for you—bestseller books to read for financial literacy, fantastic finance books for beginners, and must-read books on basic finance knowledge. 

1. Rich Dad, Poor Dad by Robert T. Kiyosaki

Ask most people if they’ve heard about Rich Dad, Poor Dad by Robert T. Kiyosaki, and the chances are, the answer is “yes.” When this New York Times and Wall Street Journal bestseller hit the shelves in 1997, it forced people to rethink their personal finances and the way they look at money, challenging the belief that you need to earn a high income to be rich. 

One of the best books to read for financial literacy, it introduces the idea of investing and of making your money work for you instead of being the one to work for your money.

2. The Total Money Makeover by Dave Ramsey

When it comes to helping you achieve financial fitness, The Total Money Makeover by one of America’s foremost business and financial experts Dave Ramsey is a financial literacy book that could change your life, one fundamental financial habit at a time.

Far from get-rich-quick schemes and glittering savings plans wielding false promises, Ramsey’s straightforward game plan offers to whip your finances—and how you think about money—into shape.

3. The Richest Man in Babylon by George S. Clason

“Wealth that comes quickly goeth the same way.” These wise words and more were originally published by author George S. Clason in 1929 in his classic The Richest Man in Babylon, a series of stories and parables that serve up practical financial advice, helping you to make financial decisions and plans that will lead to secure financial success.  

Revered as one of the best finance books and deserving of space on your bookshelf, this financial classic has aged well and holds value, even in this day and age.

4. Your Money or Your Life by Vicki Robin and Joe Dominguez

First published in 1992 and one of the best books to read for financial literacy, Your Money or Your Life by Vicki Robin and Joe Dominguez was revised and updated in 2018, making it easier to relate to in today’s life and times.

It outlines nine actionable steps that will guide you in transforming your relationship with money and achieving financial independence, asking you the question of how much “life energy” you devote to your work and whether or not it’s worth it.

5. I Will Teach You to Be Rich by Ramit Sethi

Now helming his own finance show “How to Get Rich” on Netflix, finance guru Ramit Sethi’s New York Times bestseller I Will Teach You to Be Rich touts a six-week program that will work to change your financial situation and ultimately, your life.

Targeted mostly toward young adults in their 20s and 30s, this book is one of the top financial literacy books that will inspire and empower anyone looking to pay off their debts, start saving and investing, and take action when it comes to their financial health.

6. Think and Grow Rich by Napoleon Hill

No list of the best financial literacy books would be complete without one of the best business finance books out there, the timeless classic Think and Grow Rich! by Napoleon Hill, whose main message is that success comes from knowing what you want and persisting until you achieve it.  

Touching heavily on how you think about money and perceive financial goals, Hill advocates four steps to getting what you want in life: 1) desire, 2) believe, 3) act, and 4) persist.

7. The Millionaire Next Door by Thomas J. Stanley and William D. Danko

What do America’s millionaires have in common? What surprising but effective characteristics do they possess that have helped them in their financial success? The Millionaire Next Door by Thomas J. Stanley and William D. Danko covers all that and more.

One of the best finance books out there, this book studies what gives millionaires their stuffing, and outlines the top financial habits that are building their wealth (95% of the millionaires are invested in the stock market!).

8. Broke Millennial by Erin Lowry

Packed with actual, actionable advice for today’s 20- and 30-somethings, Broke Millennial by Erin Lowry dishes out basic finance knowledge through hilariously true stories and witty little anecdotes.  

From tackling tricky money matters to clearing debt and being honest about your relationship with money, this book is easy to read in its conversational style and extremely helpful for improving your financial literacy.

9. The Automatic Millionaire by David Bach

A fantastic finance book for beginners, The Automatic Millionaire by David Bach is highly rated and recommended for those who want to get their finances in order and become financially healthy.

Backing a system of automating savings, debts, and payments (pay yourself first!), the bestseller is easy to read and full of inspiring stories and quotes that will help you in your journey toward financial success.

10. The Psychology of Money by Morgan Housel

In The Psychology of Money, award-winning author Morgan Housel offers an anthology of 19 short stories exploring the peculiar and particular ways people think about and behave toward money.

Laying the fundamentals of saving and investing your money without boring technical terms and confusing jargon, the book delivers its message in a clear, brief manner, stressing how critical it is to understand the psychology of an individual who wants to secure their financial future.

11. The Intelligent Investor by Benjamin Graham

Known as the definitive book on value investing (and with contributions by none other than billionaire magnate Warren Buffett, who is the author’s former student), The Intelligent Investor by Benjamin Graham is a finance classic and a must-read when it comes to understanding the principles of long-term investing.

This great financial literacy book offers a sound approach to investing for the everyman and is written with a tone that is easy to understand and relate to, with Graham advocating owning and holding securities in the stock market to achieve long-term financial success.

12. Money: Master the Game by Tony Robbins

Considered by many as inspired writing on financial literacy, Money: Master the Game by life and business strategist and coach Tony Robbins is one of the best business finance books you can put on your reading list.

Speaking to people on every income level, this empowering financial literacy book is a great primer for those who want to learn effective investment strategies and take the reins of their financial wellbeing.  

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