The Finance Buff

[Last updated on June 22, 2008]

There are many personal finance and investing related books out there. But surprisingly there are more bad books than good ones. I’ve reviewed a lot of them (see Book Reviews) and here are the books I recommend. All books on the Recommended Reading List have or will have a detailed review.

See full list at Amazon.com

Basics

These books cover the basics. If you don’t have much experience in personal finance or investing, start here. Don’t be turned off by the Basics label. If you mastered the basics, you are more than 90% there. Andrew Tobias wrote in The Only Investment Guide You’ll Ever Need,

The odd thing about investing — the frustrating thing — is that it is not like cooking or playing chess or much of anything else. … … when it comes to investing, all these ordinarily admirable attributes — trying hard, learning a lot, becoming intrigued — may be of little help, or actually working against you.

This is very true. If you are trying too hard, getting into the esoteric areas, you actually do more harm than good to your financial health.

Smart and Simple Financial Strategies for Busy People by Jane Bryant Quinn. Jane Bryant Quinn, a columnist for Newsweek magazine, covered a wide array of topics in this book. She did the research for you and her recommendations are indeed both smart and simple. More in full review.

The Random Walk Guide to Investing by Burton Malkiel. A easier-to-read version of this Princeton professor’s masterpiece A Random Walk Down Wall Street book, also on the recommended reading list in the Intermediate section. More in full review.

The Only Investment Guide You’ll Ever Need by Andrew Tobias. Another easy to read book, first published in 1978, now in its 8th edition. You really don’t need much more than what’s covered here. More in full review.

The Bogleheads’ Guide to Investing by Taylor Larimore, Mel Lindauer, and Michael LeBoeuf. A book from non-professional authors I hang out with on the Bogleheads forum. Good, honest advice from fellow investors. More in full review (coming soon).

The Coffeehouse Investor by Bill Schultheis. Former Smith Barney broker reveals the secret of Wall Street — there is no secret formula. Just follow a simple and effective 3-part strategy: save, asset allocation, index. More in full review (coming soon).

Fun Read

Now that you got the basics down, it’s time to have some fun. These are not guide books per se but they will add to your knowledge in the personal finance area.

Where Are The Customers’ Yachts by Fred Schweb, Jr. A humorous light-hearted book full of astute observations of how the investment world works. More in full review.

Why Smart People Make Big Money Mistakes And How To Correct Them by Gary Belsky. A fun read that reveals the common fallacies of our behaviour in managing our finances. More in full review (coming soon).

Gotcha Capitalism by Bob Sullivan. A small book full of information on how to avoid the fee traps. More in full review.

Fooled by Randomness by Nassim Nicholas Taleb. Is it luck or is it skill? It’s all about alternative reality. More in full review (coming soon).

The Paradox of Choice: Why More Is Less by Barry Schwartz. A book about how the abundance of choices actually makes us unhappy and how to deal with choice overload. More in full review.

History

“Those who cannot remember the past are condemned to repeat it.” Whatever we are seeing today happened in one form or another in the past. It’s important to study history and learn from it.

When Genius Failed by Roger Lowenstein. Fascinating stories about the LTCM crisis in the 90’s. Great lessons for even today. More in full review.

Origins of the Crash by Roger Lowenstein. What was the 2000-2002 stock market crash about? Read the analysis and see if it will happen again. More in full review.

The Greatest-Ever Bank Robbery by Martin Mayer. A review of events in the Savings & Loan crisis in early 1990s. More in full review.

While America Aged by Roger Lowenstein. A book with three case studies on the history of pension funds. More in full review.

Intermediate

The Four Pillars of Investing by William J. Bernstein. Great book on asset allocation. Same author has a more advanced book The Intelligent Asset Allocator in the Advanced section below. More in full review (coming soon).

A Random Walk Down Wall Street by Burton G. Malkiel. A masterpiece on investment and financial markets. In print for more than 30 years, now in its 9th edition. More in full review.

Advanced

The Intelligent Asset Allocator by William Bernstein. A well written book about the relationship between risk, return and portfolio construction. More technical than The Four Pillars of Investing book by the same author in the Intermediate section above. More in full review … (coming soon)

The Bond Book by Annette Thau. Most people will do OK with bond funds as opposed to buying individual bonds. But if you want to go that way, this is perhaps the best reference book about bonds and bond funds for an individual investor. More in full review … (coming soon)