Book recommendations for building financial wealth...

My goal is to create an eco-spiritual community, where we share resources to live frugally.

The surplus income we generate will be used to expand; both internally, adding new facilities to our existing homesteads, as well as replicating our community in new areas.

What I am looking for, however, is a good book to use as the basis of teaching prospective community members about financial literacy and how this sort of economics works.

I am familiar with the "Rich Dad, Poor Dad" series by Robert Kiyosaki, which is where I got my own understanding. However, I dislike the attitude and tenor of the books, which are all about "getting rich". Also, the books are intentionally vague in the details about how to go about investing, acting like a lead-in to RK's empire of workshops and seminars.

I love the basic understanding of Income, Expenses, Assets, and Liabilities, and the wisdom of how to tell the difference between an Asset and a Liability, and converting excess Income into Assets, while whittling away Liabilities.

But... I'm open to other suggestions for books.

I'd suggest "The Richest Man In Babylon". You can download it for free.

It won't give you any investing specifics, but you and your new members don't WANT any investing specifics. You don't care what some author thinks is a good investment, because you've already got your own plan ("to expand").

"Richest Man In Babylon" is short and interesting enough that your members will probably read it, which is going to be the key. People who are interested in finances, you don't need to teach them anything. People who AREN'T interested in finances, you're going to have a challenge getting them to read anything at all. So give them something that will get the basics into their heads with the least trouble you can manage.


http://thepdi.com/Richest%20Man%20in%20Babylon.pdf

Mike Cantrell wrote:I'd suggest "The Richest Man In Babylon". You can download it for free.

It won't give you any investing specifics, but you and your new members don't WANT any investing specifics. You don't care what some author thinks is a good investment, because you've already got your own plan ("to expand").

"Richest Man In Babylon" is short and interesting enough that your members will probably read it, which is going to be the key. People who are interested in finances, you don't need to teach them anything. People who AREN'T interested in finances, you're going to have a challenge getting them to read anything at all. So give them something that will get the basics into their heads with the least trouble you can manage.


http://thepdi.com/Richest%20Man%20in%20Babylon.pdf

Hi Mike,

I read the book you linked. It's pretty good! Thanks for the recommendation!

It also prompted me to look for other out-of-copyright books that might be freely available, and I found Napoleon Hill's famous "Think and Grow Rich" is freely available as an e-book.

In addition to that, I found reviews on both Amazon and elsewhere, and based on those, I chose to order used copies of Suze Orman's "The 9 Steps to Financial Freedom", 'Your Money or Your Life" by Vicki Robin, and "The Millionaire Next Door" by Thomas J. Stanley.

I will be reading and evaluating these for their suitability as a book for our classes.

Just for clarification, we will be running a year-long curriculum to teach various skills around communal living. There will be eight terms of 5-6 weeks each. The plan is to do a term on financial literacy, in which we discuss these principles of growing wealth as applied to a family situation (which is really a small commune, when you think about it), and expanding those concepts to include a larger group of adults and children sharing a household.

Thanks for your tip-- it really did lead me down a path I hadn't considered before.

Kevin

I would always recommend Dave Ramsey's "Total Money Makeover". I have lived by the advice within and have managed to weather every storm because of it including a very long period of unemployment. The only times I haven't usually end up very badly for me. It's his advice that allowed me to be the only 23 year old with 20,000 dollars in the bank about a decade back so I could afford to go on a 6 month vacation to hike the AT.

The information is the same thing he talks about for free on the radio show and he doesn't make any attempt to say otherwise on the show, but I bought it anyway and am glad I did. If you wanted to preview his advice, his show is on a lot of talk radio stations as well as I Heart Radio. Seriously good stuff.

D. Logan wrote:I would always recommend Dave Ramsey's "Total Money Makeover". I have lived by the advice within and have managed to weather every storm because of it including a very long period of unemployment. The only times I haven't usually end up very badly for me. It's his advice that allowed me to be the only 23 year old with 20,000 dollars in the bank about a decade back so I could afford to go on a 6 month vacation to hike the AT.

The information is the same thing he talks about for free on the radio show and he doesn't make any attempt to say otherwise on the show, but I bought it anyway and am glad I did. If you wanted to preview his advice, his show is on a lot of talk radio stations as well as I Heart Radio. Seriously good stuff.

Thanks for the recommendation, D.

I considered this book, as it does seem to be popular. The primary reason why I decided not to go with it, is the author's appeal to Christianity. Although we have no disagreement with the messages of Love, Compassion, Charity, and Faith that most consider to be basic Christian values, we are a forming eco-spiritual commune that is decidedly not Christian in the religious sense.

I appreciate your testimonial, however! That's a pretty amazing accomplishment!

Kevin

I have few religious sentiments in common with Christianity as I see it being practiced around me, but I have listed to Dave Ramsay on various radio stations over the years and I found his radio show both useful and inoffensive. I haven't seen his book but I imagine it's probably in accord. He focuses (at least on the radio) on practical finance and sensible choices.

Dan Boone wrote:I have few religious sentiments in common with Christianity as I see it being practiced around me, but I have listed to Dave Ramsay on various radio stations over the years and I found his radio show both useful and inoffensive. I haven't seen his book but I imagine it's probably in accord. He focuses (at least on the radio) on practical finance and sensible choices.

This. He does mention his faith regularly enough and makes no apologies that his faith is how he came to understand his method of finance needed to change and in what manner. With that said, There is the baby and there is the bathwater. If a man talking about the best way to build a boat has great ideas, but is an open satanist, I don't have to accept his ideas about spirituality to accept that he knows what he is talking about on the matter of the boat questions. As long as one goes into things knowing what to expect, one need not be concerned about the secondary aspects that don't directly relate to the topic. One could ignore the 'Back to Eden' gardening methods because of the man who came up with it having very strong religious views (and in fact many do ignore him for this reason), but I think it does a disservice to yourself when you tune out everything someone says on a topic when it is only one aspect of what they say you dislike. Both with this example and with Dave Ramsey, the financial results speak for themselves regardless of your personal spiritual beliefs.

Here's the entire The Alchemist Paulo Coelho audio version



This is also a great book about financial wealth, prosperity, and the effect of random events:

Antifragile by Nassim Taleb: www.amazon.com/gp/product/0812979680/

My personal favourites are:

The Richest Man in Babylon - short, easy read, accessible

The Automatic Millionaire - a no nonsense approach to living within your means and enforcing savings (mantra is "make it automatic" so you don't give in to human nature/weakness). I'm paying off my mortgage 10 years early after reading this book and have no other debt.

I think financial issues are generally neglected by permies. There is an attitude that "I don't like money/capitalism so I'll opt out." Unfortunately the real world doesn't respect decisions to opt out financially and I fear people are opening themselves up to a major vulnerability. We plan for long term water security, abundant food etc... but rarely when plans get thrown around on here do you see serious consideration of financial security into the future.

What happens when a key community member falls ill and needs expensive medical care? Where is the funding for a retirement plan for when physical fitness starts to fail? When a new vehicle needs to be bought or an expensive bit of kit fails...

Kevin EarthSoul wrote:
In addition to that, I found reviews on both Amazon and elsewhere, and based on those, I chose to order used copies of Suze Orman's "The 9 Steps to Financial Freedom", 'Your Money or Your Life" by Vicki Robin, and "The Millionaire Next Door" by Thomas J. Stanley.

I've read both "Your Money or Your Life" and "The Millionaire Next Door".

I think the second is better as it takes an analytical view of the traits that wealthy people have (they are NOT what you would expect). One thing that stuck in my mind from it was an anecdote about an occasion where they invited a lot of "millionaires" to a interview/workshop session which included lunch. They stocked it with fine wines, and expensive food. The participants requested beer and burgers. The traits that wealthy people actually have are very different from what flashy big spenders who are perceived as wealthy display.

The problem is that wealth has been equated with consumerism and pursuit of goods, where is true wealth is a measure of long term security - not high expenditure.

Regarding the first book - I read it cover to cover and finally decided that I really didn't like it. The format is a bit gimmicky and I don't think the approach advocated is appropriate or sensible for most people; speculative deal making with potential for big gains, but also massive exposure to risk. Slow and steady wealth building is more appropriate for MOST people, as discussed in "The Automatic Millionaire" and to some extent in "The Richest Man in Babylon".

Good luck planning your course - I think these skills are so valuable and totally neglected from formal education.

Google "Financial Independence." That's how people are talking about the combo of investing/income generation and frugal living to arrive at financial freedom. There are some great bloggers on this subject, and a few good books.

Blogs:

Early Retirement Extreme
Mr. Money Mustache
jlcollinsnh.com

...these guys link to others, and give great book recommendations. The blogger at Early Retirement Extreme, Jacob Lund Fisker, has written a book of the same name, which is basically permaculture principles applied to personal finances. Very interesting, though a bit dense.

I got the three books I ordered today:

"The 9 Steps to Financial Freedom" - Suze Orman
"Your Money or Your Life" - Vicki Robin
"The Millionaire Next Door" - Thomas J. Stanley.

I seem to recall that I've read "Millionaire Next Door" before. I think I had checked it out from a public library once upon a time. It's very good advice on frugal living.

I haven't yet cracked Orman's book.

But, out of curiosity, I started Vicki Robin's book, and I really like the approach so far.

I'll provide more complete reviews as I tackle them further.

KE

"Direct Pointing to Real Wealth" by Thomas J Elpel.

Changed my entire paradigm with regards to wealth and personal finances.

Tim Ferris has a few books with the "4 hour" theme. The 4 Hour work week is a book that I think a lot of permies should give a read.