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Best books for financial literacy?

Brian Suh

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I took finance in college but feel like I didn't learn anything, partly because i didn't care and the teacher was incredibly boring. However now that I am starting a fast lane lifestyle I have an incentive and a strong urge to understand financial literacy. What are the best books to understand financial terms? MJ lists all the things I need to know, but doesn't really list what they mean because that wasn't his focus. What are some books you would recommend a beginner in the fastlane and money making world to understand financial terms?
 

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socaldude

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I haven't really found any good books on financial literacy as the market is very saturated with the classic slowlane advice of jobs, 401ks, mutual funds, etc.

I have found that it's better to just form your own principles. Kind of like what Ray Dalio did in his books principles.

Not easy I know but you can use your own intellect.

The tricky thing is you can be financially literate and yet still do something stupid with money and never create an income beyond a job.
 

JScott

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Can you be more specific about what you mean by "financial literacy?"

Do you want to learn how to balance a checkbook?
Do you want to learn about saving for retirement?
Do you want to learn about investing?
Do you want to learn about how the economy works?
Do you want to learn about accounting?
Do you want to learn about running a business?
Do you want to learn how to read financial statements?
Other stuff?

I'm sure you eventually want/need to learn a lot of these things (and much more), but there isn't going to be a single book that will teach you all that.

If you can give us an idea of where you are in the process and what specifically you want to learn right now, I bet we can give you some resources that will help. But, each area is going to be a specific set of tools and resources...
 
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Brian Suh

Brian Suh

Bronze Contributor
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May 19, 2018
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I haven't really found any good books on financial literacy as the market is very saturated with the classic slowlane advice of jobs, 401ks, mutual funds, etc.

I have found that it's better to just form your own principles. Kind of like what Ray Dalio did in his books principles.

Not easy I know but you can use your own intellect.

The tricky thing is you can be financially literate and yet still do something stupid with money and never create an income beyond a job.
Forgot to mention thanks for the reminder. Please list authors that are "fastlaners" or have a fastlaners mindset.
 
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Brian Suh

Brian Suh

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May 19, 2018
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Can you be more specific about what you mean by "financial literacy?"

Do you want to learn how to balance a checkbook?
Do you want to learn about saving for retirement?
Do you want to learn about investing?
Do you want to learn about how the economy works?
Do you want to learn about accounting?
Do you want to learn about running a business?
Do you want to learn how to read financial statements?
Other stuff?

I'm sure you eventually want/need to learn a lot of these things (and much more), but there isn't going to be a single book that will teach you all that.

If you can give us an idea of where you are in the process and what specifically you want to learn right now, I bet we can give you some resources that will help. But, each area is going to be a specific set of tools and resources...
Sure. Mj lists in millionaire fastlanes these topics
- Interest rates
- Taxable and non-taxable yields
- Amortaization of mortages
- Balancing of a checkbook
- Basic percentage calculations
- Calculating return on investment
- Why stocks rise and fall
- why insurance exists
How a mutual fund works
What bonds are and how they rise and fall
- Global currency
- What happens to a stock when a divided is paid

I know this is a lot but if there is a book that has most of these topics or some and just explain basics I will be grateful
 

biophase

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You don't need books for most of this stuff. Many of these topics you can understand reading a few paragraphs. The other stuff you can read a ton of books on, depending on the level of knowledge that you want to know.

- Interest rates - Probably need a book to explain in depth
- Taxable and non-taxable yields - Google it
- Amortaization of mortgages - Google it
- Balancing of a checkbook - Google it
- Basic percentage calculations - Google it
- Calculating return on investment - Google it
- Why stocks rise and fall - Probably need a book to explain in depth
- why insurance exists - Google it
How a mutual fund works - Google it
What bonds are and how they rise and fall- Probably need a book to explain in depth
- Global currency- Probably need a book to explain in depth
- What happens to a stock when a divided is paid - Google it
 

D.Navi

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When I was researching a product in the retirement niche I found a lot of YouTube videos that made it easy for me (a total layman) to understand.

They use helpful, real-life analogies to break down concepts like debits and credits, balancing books, how stocks and indexes work etc.

Usually these channels are CPA's, brokers, financial planners and other professionals worth their salt. And some of them are fastlaners who run their own businesses.

But as always, Google is your friend.
 

Kid

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You might look at investopedia, they have
bite-sized definitions like:
 

ChrisV

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Balancing a checkbook - is this really necessary in 2019? I don't think it is. I just check my Online Banking. Honestly the last time I remember someone balancing a checkbook was like... 1995.

Just use a budgeting app like Mint.
 

Kevin88660

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I took finance in college but feel like I didn't learn anything, partly because i didn't care and the teacher was incredibly boring. However now that I am starting a fast lane lifestyle I have an incentive and a strong urge to understand financial literacy. What are the best books to understand financial terms? MJ lists all the things I need to know, but doesn't really list what they mean because that wasn't his focus. What are some books you would recommend a beginner in the fastlane and money making world to understand financial terms?
There are too many things can be learnt as finance itself is a topic too wide. I don’t recommend you to go start with any book to waste time.

I suggest you to learn only when you stumble upon and then go into detailed reading. Investopedia is a good place for you to get quick facts.

You just need the basic intuition in Finance and Economics to make decisions. They help you develop simple models and decision framework.

There was a guy asking about whether he should leave a 100k job for a 200k job, in return he would have less time for business. But his current business, if all things go well will make 300k a year. Then obvious from financial pov he should take the 200k offer because his opportunity cost in business is too small. A sure 200k income is much better than a possible 300k per year. His business has to be a potential million dollar business for him to give up a 200k job.

The basic premise of finance and business is that a dollar uncertain is always better than a dollar uncertain. One dollar today is always better than a dollar tomorrow. So the return in the future, especially in uncertain outcome has to be relatively big for someone to give up something certain.
 

JScott

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Sure. Mj lists in millionaire fastlanes these topics
- Interest rates
- Taxable and non-taxable yields
- Amortaization of mortages
- Balancing of a checkbook
- Basic percentage calculations
- Calculating return on investment
- Why stocks rise and fall
- why insurance exists
How a mutual fund works
What bonds are and how they rise and fall
- Global currency
- What happens to a stock when a divided is paid

I know this is a lot but if there is a book that has most of these topics or some and just explain basics I will be grateful
You're not going to find all of this in one book. And even some of these individual topics will require more than a single resource...

To address your first topic (Interest Rates), here's a video that I created last year as part of a training course for real estate investors -- watch it all the way through, and it should give you a good idea of how interest rates fit into the bigger picture of economics and economic cycles:


Here's another video from Ray Dalio that is a must-watch as well:

View: https://www.youtube.com/watch?v=PHe0bXAIuk0


Between those two videos (and probably even without mine :) ), you should have a pretty good idea of how interest rates factor into economic forces and cycles.

When I get some time, I'll try to address some of the other topics...
 

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ChrisV

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My knowledge of Economics is pretty limited, and I don't claim any amount of expertise but I gained a lot from this book:

It's a really popular book for people who want to have an understanding of Economics, but don't necessarily want to get a degree. It changed the way I see a lot of economic issues.

It's really the nuts and bolts of economic theory.
 

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