One thing the world's wealthiest people have in common is they attribute their success to a continuous pursuit of knowledge. Warren Buffett reportedly reads 500 pages each day and likens knowledge to compound interest: it grows faster over time. Microsoft founder Bill Gates also reads avidly, finishing 50 books a year.
In "The Monk Who Sold His Ferrari," Robin Sharma wrote that "investing in yourself is the best investment you will ever make. It will not only improve your life, but it will also improve the lives of all those around you."
Reading books on finance and investing is a great way for millennials to invest their time and money. Books can be great mentors, as they allow for wisdom to be easily accessible any time of day and virtually anywhere. Below are five books that can help millennials become better investors.
Alwaleed: Businessman, Billionaire, Prince, by Riz Kahn
This biography of Prince Al-Waleed bin Talal documents the life of the man who is often referred to as the Arabian Warren Buffett. In 2005, when prominent British journalist Riz Khan published the book, Al-Waleed was worth $24 billion, making him the fifth richest person in the world. Despite being a member of Saudi Arabia's royal family, Al-Waleed is considered somewhat self-made. He started with a bank loan and built an investment holding company worth billions. The book gives insight into his unique approach to investing.
Rich Dad's Cashflow Quadrant, by Robert Kiyosaki
Robert Kiyosaki is one of America's most sought-after finance experts. His New York Times bestseller, "Rich Dad Poor Dad" showed millions of readers a path to financial independence. In "Cashflow Quadrant," Kiyosaki outlines basic principles shared in "Rich Dad Poor Dad" and explains the advantages and disadvantages to the four ways people can make money: by being an employee, self-employed, a business owner or an investor.
Warren Buffett Invests Like a Girl, by The Motley Fool
The top takeaway from this Motley Fool book is that temperament can either be a great asset or a huge liability. Buffett's temperament, which the book describes as feminine, is a great asset. The easy-to-read book compares female investors (who carefully consider their investments) to male investors, who trade frequently and chase hot tips. To improve their returns, investors should exhibit the patience and good decision-making of women.
Warren Buffett's Three Favorite Books, by Preston Pysh
Warren Buffett's investment philosophy was greatly influenced by Benjamin Graham's "The Intelligent Investor" and "Security Analysis," in addition to "The Wealth of Nations" by Adam Smith. These three books are great resources for investors, but they can be a bit complex for beginners. Preston Pysh realized this and simplified the primary concepts shared in each of those books into one easily digestible text: "Warren Buffett's Three Favorite Books."
Berkshire Hathaway Letters to Shareholders, by Max Olson
Every year legendary investor Warren Buffett writes an annual letter to shareholders dispensing timeless wisdom and insights from running his multi-billion dollar conglomerate Berkshire Hathaway. Max Olson compiled these letters into a single volume that allows readers to see how Buffett and his investments have evolved over 50 years.
The Bottom Line
Reading books is a great way to learn about the lives, philosophies and strategies of successful investors. Although experience and knowledge comes from making many mistakes, investors should try to learn from the mistakes of others in the world of finance and investing. This can save investors time and prevent large monetary losses.