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Money impacts so many aspects of our lives, yet so few people feel in control of their financial future. According to Capital One and Decision Lab’s Mind Over Money study, 77% of study participants reported feeling anxious about their financial situation. Of these, 58% of respondents felt that finances were controlling their lives.
The fact that more than three-quarters of the over 1,000 individuals involved in the study felt anxious or out-of-control about their finances does not bode well for our financial future as a country.
The following resources can help you to take control of your finances and put you on the right side of future money study statistics.
An introduction to personal finance
Five years ago, I was one of the people feeling anxious and not in control. I was living paycheck to paycheck. Although I was paying my bills monthly and making regular debt payments, I had no vision for my financial future. For Christmas 2015, my Mom gave me one of the best gifts of my life. She signed me up to attend Dave Ramsey’s Financial Peace University, and it opened my eyes to all the ways I was mistreating my finances.
Once I started learning in class about how I could take control and improve my financial health, I was hooked. I couldn’t get enough of personal finance. I sought out books, podcasts, and blogs that would help me along the way.
Learning new concepts, implementing them in my own life, then sharing those insights with others is a passion of mine. Now that I am debt free with years of financial management under my belt, I am sharing the personal finance books and podcasts that helped me along the way in hopes that they may help some of you do the same.
The big ideas from industry experts
Much like other areas of wellness, there are many commonalities across the informational sources I’ve found. You can think of these as the “diet and exercise” tips of the personal finance world.
- Spend less than you earn – This one should be a no brainer, but based on the amount of credit card debt in our country, it is not. According to a survey by WalletHub, the average American household had just over $9,000 in credit card debt at the end of 2019. That kind of debt is extremely stressful. It’s not surprising that participants in the Mind Over Money study reported sleep disruptions, trouble concentrating at work, and feelings of fatigue as side effects from their financial burdens. It’s critical to know where your money is going to relieve stress and get back on track. Since you can’t change what you don’t track, writing down your expenses for a week or more could give you some considerable insights into where you may be overspending.
- Two ways exist to have more money, spend less or earn more, and only one of those is exponential – Clipping coupons and using online rebate sites can be a fun challenge, but even all the small savings in the world can’t help you if your income is low. There is always going to be a limit to how much money you can cut from your spending. There will never be a limit to how much you can earn. Increasing your earning could mean seeking a raise or promotion at your current employer or branching out to do a side hustle or part-time job. Whatever you choose to do, remember that earning more is always going to be the fastest path to your financial freedom.
- Everyone needs an emergency fund – The emergency fund is what enables you to be successful at any kind of debt repayment strategy. If you’re already out of debt, the emergency fund is a useful tool to cover unexpected expenses instead of savings and other investments. It’s not a matter of if something will come up, but when! Check out my post on emergency funds here.
- High-interest debt must go first (followed closely by all other liabilities) – If you have debt, the rule of thumb is to pay off high-interest debt first. An agreed-upon range for high-interest debt is an interest rate of over 7-9%. Most often, this debt is from credit cards, which average an interest rate of 18-20%. It took me a little over three years to pay off several thousand dollars in debt between student loans, auto loans, and credit cards. I used Dave Ramsey’s debt snowball approach to attack my smallest debt first, then roll the payments into my next debt. While it took what felt like forever, I can tell you the satisfaction of being debt-free is so very worth the time it takes!
- Pay yourself first – Many people assume they will be able to save what’s leftover at the end of the month. I used to be one of those people until I realized that most months I was spending nearly every dollar I had. The game-changer for me was to pay myself first by taking my monthly savings off the top of my paycheck. I paid myself through a separate direct deposit instead of waiting to see what scraps were in my account at the end of the month. By setting up a separate deposit, I didn’t feel the impact of saving as much because it was happening automagically. (Yes, that’s a real made-up word and one of my favorites which is a combination of automatically and magically).
Books that introduce you to the fundamentals
- Total Money Makeover* – Dave Ramsey was my introduction into the personal finance space, so it’s only right he holds the first spot on my list. This was the first book I read that inspired me to start on a path of getting my financial life together. Dave is famous for his “baby steps” approach, where he outlines seven steps for people to follow to reach financial freedom. Dave’s plan starts with creating a 1,000 emergency fund. The emergency fund is one of the most critical pieces to any financial picture, as I outlined above. This book is fantastic for anyone just starting with personal finance. It provides a simple and straightforward path for getting yourself out of debt and into the life you want to lead.
- The Latte Factor* – This book is David Bach’s first parable. It’s great for someone who wants to learn about money management but isn’t into reading non-fiction. The story follows a young woman living in New York City as she embarks on a journey to understanding how her daily latte habit is affecting her long-term financial picture. While I think there are other financial tactics that don’t require skipping your daily latte, this book has a lot of valuable lessons about compound interest and general financial decision making.
- Broke Millennial* – Erin Lowry tackles personal finance with a millennial mindset that is super relatable. She uses personal stories to cover money mindset and practical savings tips as well as uncomfortable financial situations. For example, how to ask to split the bill when you’re out with your girlfriends who are on the third bottle of wine, but you’re not drinking and only had a salad. We’ve all been there. Erin has another book out, Broke Millennial Takes on Investing*, and a blog that’s also worth checking out!
- I Will Teach You To Be Rich* – This book by advisor and entrepreneur Ramit Sethi reads as if your best friend was talking to you about your finances. Ramit has a candid approach. He is very “tell it how it is” with regards to financial moves you should or should not be making. This book dives deep into what types of accounts you should have, which banks you should or shouldn’t use, and how to invest your money. In my opinion, this is not a beginner’s guide. I would only recommend it for people that have basic financial concepts under their belt.
Podcasts that help you learn while having fun
- Afford Anything – Paula Pant is a straight shooter who is extremely intelligent and well-spoken. Every other week she answers questions from the Afford Anything community. The weeks in between host guests with exciting money stories. I love to listen to the question and answer episodes because Paula offers her callers a framework for how to think through their problems. She doesn’t merely hand out solutions. Paula is also extremely experienced in the realm of real estate investing. There are a ton of good episodes that answer only real estate questions. Her blog is an excellent resource, too!
Episode to check out: One of my favorite Ask Paula question and answer shows
- Stacking Benjamins – This podcast is great for people who want to learn about finance under the guise of a variety show. I find myself laughing out loud at this show pretty much every episode. There is a ton of banter and joking sprinkled with legit advice and financial product reviews. The hosts are both former financial advisors and know their stuff. This three times per week show has a roundtable of awesome guests every Friday, which most weeks also includes Paula Pant from Afford Anything.
Episode to check out: Another great Friday roundtable with a preview of a cool new financial app called Peak Money
- Bigger Pockets – This podcast has a few different spin-offs, including real estate, money, and business. My favorite is Bigger Pockets Money, as Scott and Mindy interview entertaining guests with great stories. They’ve had Paula Pant, Ramit Sethi, and Erin Lowry as guests! The Bigger Pockets website is flush with information. It’s an especially great resource if you’re seeking to know more about the real estate investing space.
Episode to check out: An episode dedicated to buying your first house which walks through the buying process and what you need to know as a first time home buyer
I hope that you were able to find at least one resource above that can help you on your journey to a better financial future. Leave me a comment and let me know about other books and podcasts that have influenced you.