Introduction

In honor of it almost being summer time, I decided to compile a list of the 25 all-time great investment/financial planning/business related books that I’ve read over the years. There should be something for about everyone on this list.

I’ve compiled these books into the following sub-categories: General Personal Finance, Investing, Behavioral Finance, Books for Business Owners, Investment/Business Biographies, Compelling Finance-Related Non-Fiction, Non-Fiction Dealing with Financial Crisis of 2007-2009, and Books on Corporate Scandals.

General Personal Finance Books

1.) The Richest Man in Babylon by George Clason

2.) I Will Teach You to be Rich by Remit Sethi

Sethi’s book is a great primer for people in their 20’s and 30’s that are trying to get their finances in order. The book outlines actionable steps to do over the course of a six-week period. Topics covered include: how to select a good credit card, how to pay down debt, how to make a budget, how to invest and what to invest in, and how to automate your finances. For those of you that are wanting to get serious about your finances, this is the book for you.

3.) Rich Dad, Poor Dad by Robert Kiyosaki

I remember how excited I got while reading Rich Dad Poor Dad for the first time in college. I even purchased his corresponding Cashflow board game and played it a few times with friends. These days, I don’t fully adhere or agree with everything mentioned in the book (think he’s too real estate heavy in his recommendations, for instance), but I do think there’s enough value in the book to (hesitantly) add it to this list. Despite it’s faults, Rich Dad Poor Dad does a great job of encouraging people to acquire assets instead of liabilities, teaching the importance of keeping your expenses low so that you can save more, and then allowing your money to work for you instead of you working for your money. Read the first two books in this section before this one, but I do think there’s some good motivational tidbits to be found in this book.

Investing Books

1.) A Random Walk Down Wall Street By Burton G. Malkiel

If you had to pick only one personal investing book to read, A Random Walk Down Wall Street would be my suggestion. It’s one of the best books ever written on the topic and is an all-time classic.

Dr. Burton Malkiel, a senior economist at Princeton University, does an incredible job making the point that while everyone wants to beat the market, very few actually do. Through this book, you’ll learn the essentials of investing (what works and what doesn’t), investment assets (what to buy and what not to buy), and how to build your own investment portfolio.

The only caveat I will say about this book is that it is fairly long (nearly 500 pages), so if long books are not your thing, proceed to the next book on this list…

2.) The Investment Answer By Gordon Murray and Daniel C. Goldie

In 2010, Gordon Murray, a long-time investor on Wall-Street, was diagnosed with terminal brain cancer. Upon hearing this news, Murray vowed to make the most of the time that he had left and complete a project that he had always wanted to do. Teaming up with his friend, Daniel Goldie, they wrote this fantastic, 96-page primer on investing before Murray’s death the following year. It’s a quick read and well worth your time.

3.) Simple Wealth, Inevitable Wealth by Nick Murray

Nick Murray may not have the name recognition outside of the industry, but in financial planning circles he’s a rock star. I’ve read nearly all of his books and have had the privilege of hearing him speak in person several times. Simply put, he’s a wealth of knowledge and valuable information. While most of his books are geared towards financial professionals, Simple Wealth, Inevitable Wealth is his investment book that is geared towards everyday investors. It’s probably the most expensive book on this list, but I would highly recommend it.

Behavioral Finance

1.) The Behavior Gap by Carl Richards

The average investor’s investment returns tend to substantially lag the overall market’s returns. While fees and expenses can be responsible for a small part of this, the primary reason is investor behavior. In investment circles, this is known as the behavior gap. In The Behavior Gap, New York Times columnist and financial planner Carl Richards highlights the behaviors that deter us from being successful investors and outlines steps that you can take to limit the effect that they have on your investment decisions.

2.) Thinking Fast and Slow by Daniel Kahneman

If you’ve ever read Michael Lewis’ book The Undoing Project, then you might be familiar with Daniel Kahneman and his Nobel Prize winning research in behavioral finance. Thinking Fast and Slow is a summation of his life’s work in the study of how our minds work. In it, Kahneman outlines the areas where our intuitions are valuable and other places where they should not be trusted, while also giving mental techniques to keep us from getting ourselves in trouble. I found this book fascinating and think you will too.

3.) Happy Money: The Science of Smarter Spending by Elizabeth Dunn and Michael Norton

In Happy Money, Elizabeth Dunn and Michael Norton examine how we spend our money and how those decisions affect our overall happiness. Through their research, they’ve outlined five core principles that when applied to our spending decisions generally tend to make us happier people. For instance, most people generally look back with great fondness on certain events/trips/experiences that they splurged money on, while usually not experiencing the same prolonged satisfaction from buying “stuff.” Similarly, most people who give at least some of their money away to charity tend to be happier individuals. I found this book to be a great read that will definitely be worth your time.

4.) The Millionaire Next Door by Thomas J. Stanley

The Millionaire Next Door is one of those all-time classic books. In it, Thomas J. Stanley highlights seven common traits that most people have that have accumulated substantial amounts of wealth, while also taking a look at the profile of what an average millionaire looks like. What is their occupation? Where do they live? What kinds of cars do they drive? Where do they shop? How do they invest? A classic that is worth checking out.

Books for Business Owners

1.) The E-Myth Revisited by Michael Gerber

Michael Gerber’s E-Myth Revisited is a must read for any small business owner. The point of the book is fairly straight forward: too many business owners spend so much time working IN their business (day-to-day tasks) that they don’t spend the necessary time working ON the business (things to help scale and grow the business). E-Myth Revisited discusses ways to help systematize your business so that you can grow and scale and increase profitability, while also providing the same caliber of product and level of service to each customer that you serve. If you’re a business owner and have never read this book, grab a copy and start reading!

2.) The Hard Thing About Hard Things by Ben Horowitz

In The Hard Thing About Hard Things, Ben Horowitz, one of the founders of the well-known venture capital firm Andreessen Horowitz, shares lessons learned from his own successes and failures of starting, building, and selling businesses in Silicon Valley. Each chapter is informative and deals with a range of business issues that owners will encounter such as hiring (and firing) personnel, whether you should incorporate titles and promotions in your company (and how to handle them if you do), tips to avoiding the wrong hire, how to keep your sanity during stressful times, and issues to think about when potentially selling a business. It also doesn’t hurt that Horowitz is a pretty humorous guy and has a lot of good stories to tell.

Investment/Business Biographies

1.) The Snowball: Warren Buffett and the Business of Life by Alice Schroeder

There are a lot of books about the “Oracle of Omaha” out there, but this 960-page tome is the best one in my opinion. This comprehensive biography covers everything about Warren Buffett’s life: his childhood growing up in Nebraska, his time studying under Benjamin Graham, building Berkshire Hathaway from a small textile company to an investment powerhouse, meeting his long-time business partner Charlie Munger, his investment successes, his investment failures, his affinity for hamburgers and Coca Cola, his strange relationships with his wife and the other women in his life, Bill Gates, bridge tournaments, it’s all here. This is the complete biography of one of the all-time great investors and a must read for anyone that is interested in the subject matter.

2.) Steve Jobs by Walter Isaacson

In my personal pantheon of all-time great biographies that I’ve read, Isaacson’s bio of Steve Jobs is number two; second to only Robert Caro’s The Power Broker (it’s a political bio so it’s not covered in this blog, but you should read that too because it’s incredible). Isaacson does such a great job capturing the sheer genius of Steve Jobs, while also not shying away from his oddities, demons, and his propensity towards being a major jerk sometimes. It truly is a joy of a read and I would highly encourage you to check it out.

3.) Shoe Dog by Phil Knight

Shoe Dog is an incredibly enjoyable read. Phil Knight’s autobiographical memoir tells the story of how he built Nike from a fledgling shoe company to a premier athletic brand with world class athletes, such as Michael Jordan and Tiger Woods on the payroll. If you’re anything like me, you’ll be amazed by the amount of risk that he took throughout his career to make Nike what it is today. Truly crazy and amazing.

4.) The Man Who Solved the Market by Gregory Zuckerman

Jim Simons may not have the name recognition of a Warren Buffett, Peter Lynch, or Ray Dalio, but the accomplishments of his hedge fund have exceeded all of the aforementioned. Since 1988, Renaissance’s Medallion fund has generated average annual returns of 66%! This biography details the life of Simons and how he went from a math professor at a small college to founder of one of the most successful quant hedge funds in existence.

Finance-Related Non-Fiction

1.) When Genius Failed: The Rise and Fall of Long-Term Capital Management by Roger Lowenstein

When John Merriweather, along with some of his smartest colleagues, left Salomon Brothers to form Long-Term Capital Management in 1993, it was hailed to be potentially one of the greatest hedge funds of all time. Within four years, the fund had grown to over $100 billion. Then, they imploded in grandiose fashion, almost taking the entire worldwide market down with them. This book was an instant classic when it was first released in the early 2000s and is just as compelling now.

2.) Flash Boys by Michael Lewis

While Liar’s Poker, the Big Short, the Blindside, and Moneyball all might have more name recognition to the general public, Flash Boys is hands down my favorite Michael Lewis book. When I read this a few years ago, I knew practically nothing about high frequency trading or the secretive firms that employ such trading tactics. Once I started reading, I couldn’t put it down and finished the entire book in less than 24 hours! If you’ve never read a Michael Lewis book, start with this one.

3.) Red Notice: A True Story of High Finance, Murder and One Man's Fight for Justice by Bill Browder

Another fascinating book that is really hard to put down. Red Notice is an autobiographical memoir that recounts Bill Browder’s experiences of operating a hedge fund in Russia. It’s a crazy, real life thriller that shows you what working as a financier in a corrupt country looks like and what dangers come with it. Highly, highly recommend adding this one to your reading list!

4.) Den of Thieves by James B. Stewart

Den of Thieves tells the story of how 80’s junk bond king Michael Milken, along with investors Ivan Boesky, Martin Siegel, and Dennis Levine created one of the most elaborate insider trading rings in financial history and how they were eventually caught by the authorities. If you’ve ever seen Oliver Stone’s Wall Street, the character of Gordon Gecko is actually based on Milken and Boesky. In fact, Michael Douglas’ famous “Greed is good” speech from the movie is based off of a similar speech given by Boesky at Cal Berkley in 1986. If you’re into books about financial fraud, this is one of the all-time greats.

Non-Fiction Dealing with Financial Crisis of 2007-2009

I think the 2007-2009 Financial crisis is such an interesting period and have read the majority of the major books on the subject over the years. Below are my three favorites on the subject. They all tackle the same overall topic, but focus on different aspects of the crisis.

1.) Too Big to Fail by Andrew Ross Sorkin

Sorkin does a masterful job of reporting the back and forth discussions that went on behind the scenes between the Fed, the Treasury department, and the major banks and investment institutions during the largest financial crisis since the Great Depression. Too Big to Fail is a fairly long book at 600 pages, but it doesn’t feel big as it’s an enthralling read. A truly fascinating play-by-play of one of the most significant financial events in modern history.

2.) All the Devils are Here: The Hidden History of the Financial Crisis by Bethany McClean and Joe Nocera

While Bethany McClean’s account of the Financial Crisis does spend some time on the big banks and investment firms like Sorkin’s book does, she also spends a great amount of time placing the spotlight on other guilty parties in the economic collapse, such as: the housing industry, Countrywide Financial and other sub-prime lenders, AIG, the Fed, Fannie Mae, and Freddie Mac. Probably the most well-rounded analysis of the crisis between the three books.

3.) The Big Short by Michael Lewis

This is probably the most famous book of the three because it was then turned into a hit movie of the same name. As is often the case, while I think the movie is decent, I find the book to be so much better. Instead of focusing on the heads of major banks and investment institutions and the Treasury and the Fed, The Big Short mainly focuses on several different Wall Street traders and investment fund managers as they navigate the financial crisis. Definitely a great read if you’ve never read it or only watched the movie.

Corporate Scandals

1.) The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron by Bethany McClean and Peter Elkind

Of all the books on this list, this is probably up near the top of the list for me personally. The Smartest Guys in the Room is a meticulously researched masterpiece by McClean and Elkind. The book tells the story of Enron’s meteoric rise to becoming one of the most respected, valuable companies in the world, and then its subsequent catastrophic fraud-filled collapse. A must-read for anyone who finds business-related scandals interesting.

2.) Bad Blood: Secrets and Lies in a Silicon Valley Startup by John Carreyrou

My favorite book that I read in 2018. Elizabeth Holmes was considered to be the new whiz kid in Silicon Valley. She was the founder of a blood testing company, Theranos, that had a valuation of $10 billion and a board of directors with the likes of Henry Kissinger, James Mattis, and George Shultz on it. There was only one small problem…Theranos’ blood testing technology did not work.

Conclusion

So that’s my list! Hopefully there’s something that you can add onto your reading list for this summer!

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Disclaimer: This article is provided for general information and illustration purposes only. Nothing contained in the material constitutes tax advice, a recommendation for purchase or sale of any security, or investment advisory services. I encourage you to consult a financial planner, accountant, and/or legal counsel for advice specific to your situation. Reproduction of this material is prohibited without written permission from Daniel Patterson, and all rights are reserved. Read the full disclaimer here.

25 All-Time Great Books for Your Summer Reading List (2020)