Best Personal Finance Book For Young Adult
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Some millennials may know about Ramit Sethi from his New York Times Bestseller, I Will Teach You to Be Rich. However, the younger generation may only know him from his new Netflix show, How To Get Rich.
I have not watched Ramit's Netflix show, but I am sure I would also enjoy it.
This new blog series is made to help people with varying degrees of knowledge in personal finance. I will help you sift through all the poor information and point you to one legitimate source with actionable advice.
Who "I Will Teach You To Be Rich" Is For
I called this article, "Best Personal Finance Book For Young Adults", but I would not limit the reach to this age group. I Will Teach You To Be Rich is also for anyone who wants to get a handle on their finances but lacks the understanding of how to do so.
This book is also for the individual who knows how to "save" their money but sees investing as gambling. If you see the stock market the same way as investing all your money in Crypto or betting it all on black in Vegas, this book is for you.
Overview of Book
Ramit Sethi's book "I Will Teach You to Be Rich" is notable for being a personal finance manual that doesn't focus on saving and cutting back in the conventional sense. This book discusses a comprehensive approach to financial well-being and personal fulfillment rather than just how to get rich. This is why I love it for beginners and young adults.
It offers a six-week course focused on reaching financial richness—a concept used by Sethi to characterize a life in which one's resources complement one's goals.
"I Will Teach You to Be Rich" is a manual for leading a wealthy life, one in which money is merely a tool to help you realize your aspirations. The goal is to use your wealth to build a life full of experiences, contentment, and happiness rather than just amassing wealth in a bank account.
This concept is what my Seven-Year Time Challenge is all about. Using money as a tool to get what I want out of life instead of having a dollar amount as the end goal. Money is a tool and nothing else.
In addition to laying out financial guidelines, Sethi also teaches how to modify them to suit a person's circumstances, making sure that the advice is realistic, individualized, and sustainable.
Want a free audio version of this book? If you do not want any more spoilers, here is a link to the Audible version. If you are a new subscriber to Audible, you will get this book for free!
Themes In "I Will Teach You To Be Rich"
Sethi dispels the myth that credit cards are fundamentally evil by delving deeply into credit card optimization that helps the user. Credit card debt is the enemy.
He offers helpful guidance on managing credit sensibly to raise your credit score, which can lead to cheaper interest rates on major purchases down the road, potentially saving you thousands of dollars.
Additionally, he offers strategies for optimizing benefits and using credit cards to your advantage rather than as a debt-accumulating trap. Sethi then discusses banks, showing you how to pick a bank that will provide you with the best benefits and the highest interest rates on savings accounts to let your money grow on its own.
Many people view investing as being scary and complicated, but Sethi demystifies it by breaking down the fundamentals of stocks, bonds, and retirement accounts into simple terms.
He promotes using employment match programs, starting with retirement accounts like a 401(k) or Roth IRA, and talking about the power of compound interest—basically, the idea that you don't have to be wealthy to start saving.
He also gives the reader an overview of low-cost, long-term investing strategies (my favorite being low-cost index funds), stresses the value of starting investments early, and emphasizes consistency over market timing.
An essential component of Sethi's approach is automation. All of your financial transactions, including bill payment and money transfers to savings and investment accounts, can be automated to reduce the chance of human error and the urge to overspend.
Without the need for constant supervision, this automation guarantees that savings increase, bills are paid on schedule, and investments make money over time.
Automation helps make "paying yourself first" easy.
Along with dispelling the myth of financial expertise, the book advocates for self-education as opposed to depending solely on financial advisors, who frequently have their own set of prejudices and fees. *Cough cough This Blog cough cough*
Sethi gives readers the information and resources they need to make wise financial decisions. This gives people the confidence and ability to successfully manage their finances, protecting them from avoidable costs that come with so-called experts.
My Final Thoughts
I doubt there is anyone I agree with on everything, but that doesn't mean I should ignore someone completely because of this.
Sethi takes more of a tough-love approach with his advice, which I appreciate. I do not implement this strategy in my everyday life, but it can be effective at times.
His principles are sound, and most people will be better off after following his advice.
Again, this is not the conventional wisdom of work, save, retire, then die. Ramit focuses on enjoying life more in the present instead of waiting until a traditional retirement.
I would love to hear what other books you would recommend in the comment section below! Let us be a community that helps each other grow. If you enjoyed this article, don't forget to hit the heart icon, share it with your friends, and subscribe for more content.